How do prepaid cremations work?

2 answers | Last updated: Oct 05, 2016
Jorob63 asked...

Is there an insurance policy involved in prepaid cremations? If so who is the beneficiary? How do they work?

Expert Answers

Ed Markin, BS, MBA, PhD, is the director of research for the Alzheimer's Disease Research Foundation and author of more than a dozen books. For the past 15 years, Markin has operated the Funeral Help Program.

Prepaid cremation costs will vary according to your location, the goods/services included, and the crematory or funeral home's policies. There could be an insurance policy involved, and with it an 'exclusionary period'. Typically, the longer the pay-in period (and lower the installments) the longer the exclusionary period to cover the crematory (or funeral home) should the insured die prior to paying in full. During this period, let's say two years for example, the benefit paid would be something like the sum of installments paid plus a percentage (10% is common) paid toward the agreed-upon price of the cremation. Like many prepayment plans, the crematory or funeral home will likely be the beneficiary if an insurance policy is involved.

These plans are a great way to take the pressure off your loved ones, and often a very affordable way to go about it. At the very least a prepaid plan (funeral OR cremation) lets the family know what you wanted, and that alone makes it worth doing; sparing them from having to wonder if they guessed correctly.

Community Answers

Ginger116 answered...

I have a pre-paid cremation policy that I purchased from a funeral home. This policy may be transferred to any another funeral home, and I found them more than willing to honor this plan. It has been over 13 years since I purchased this service and I feel certain the price has increased since I purchased mine.

In my case, it has taken the pressure off my family, that this choice I have made, will not be their financial responsibility.It has given me peace of mind that my wishes will be carried out at the time of my death.