What funeral insurance costs

Funeral insurance is a small lump sum, usually paid quickly, intended to cover a funeral and the immediate costs that arrive before an estate is settled. Its appeal is straightforward: the amounts are modest, the application is often short, and some products ask no health questions at all.

The pricing structure is what deserves scrutiny. Premiums are typically payable for life, or until a set age, on a sum insured that does not grow. On a policy taken in your sixties and held into your late eighties, the total paid can approach or pass the amount the policy will pay out.

We do not publish figures for what a New Zealand funeral costs, or for what funeral cover costs, because we do not have a source we would stand behind. Both vary widely — burial or cremation, region, the kind of service — and a national average would mislead more than it helps.

1. 1Ask for the sum insured and the premium, then ask for total premiums payable to age 85 and to age 90.
2. 2Ask whether the premium is fixed or rises with age, and whether it stops at any point.
3. 3Ask whether the sum insured is fixed or indexed, since a fixed amount loses value over decades.
4. 4Ask what the stand-down is — most no-health-questions products only cover accidental death for an initial period.
5. 5Compare the answer against a small amount of ordinary underwritten life cover, and against simply setting money aside.

When funeral cover is genuinely the right answer

• Where health history makes underwritten cover expensive or unavailable, and something is needed quickly.
• Where the money has a specific job and the timing certainty matters — a policy pays in full from day one, savings take years to build.
• Where an estate is likely to be tied up and the family needs cash before probate is granted.
• Where the alternative is genuinely nothing, and a small guaranteed amount removes a real worry.

These are the details that decide whether the cover does what you expected. Read them before you compare on price.

• Whether premiums are payable for life, and what the total comes to over a normal life expectancy.
• Whether there is a stand-down period on non-accidental death, and how long it runs.
• Whether the sum insured is fixed, which means it buys less each year.
• Whether the policy has a maximum age after which premiums stop but cover continues.
• Whether the benefit is paid to a nominated person or into the estate, which affects how quickly it arrives.
• Whether a prepaid funeral plan through a funeral director would suit better than insurance.

Every New Zealand insurer writes what life insurance costs in nz to its own wording, and the words are where the money is. Two policies that look identical on price can pay very differently when it matters. Closing that gap is the entire job of an adviser.

• Comparing funeral cover against a small underwritten life policy is a straightforward exercise that most people never do.
• Where health history is the reason for choosing funeral cover, an adviser can check whether underwritten cover is actually available first.
• Stand-down periods and total-premium caps differ between products in ways the marketing does not emphasise.
• An adviser can tell you when the honest answer is to save the money instead.

There are three ways to buy life cover in New Zealand, and they are not equivalent. You can buy direct from one insurer, which means you see one product range and one underwriting appetite. You can buy through your bank, which usually means a single insurer’s product sold under the bank’s brand, often with narrower definitions. Or you can go through an adviser, who quotes several insurers at once and is required to put your interests first.

The premium you pay is the same either way. Insurers build adviser commission into their pricing whether or not an adviser is involved, so going direct does not get you a discount — it just removes the person whose job is to argue your corner at application and at claim time.

• An adviser can see which insurer is currently taking your health history on standard terms, and which one will load or exclude it.
• An adviser can structure cover across two insurers if that produces a better outcome than putting everything with one.
• An adviser handles the underwriting back-and-forth, and is the person who chases the claim when a family is least able to.
• An adviser has to document why the recommendation suits you, which is a written record you can hold them to.

We are a referral service, not an insurer. We do not quote premiums and we do not sell policies. What we do is put you in front of one licensed New Zealand adviser who can compare the market properly.

1. 1

   You tell us what you are looking at

   The form takes about a minute. Nobody asks for your medical history on a web form — that conversation happens with the adviser, properly, and only once you have decided to proceed.

2. 2

   An adviser calls you

   A licensed New Zealand adviser talks through your situation: who depends on you, what you owe, what you already have in place, and what you are actually worried about.

3. 3

   They compare the market

   The adviser quotes across the major insurers, checks which of them will take your health history on the best terms, and puts the options side by side in writing.

4. 4

   You decide, in your own time

   There is no obligation and no cost to you. If the answer is that you already have enough cover, a good adviser will tell you that.