One thing they have in common life insurances and the funeral insurance is that both cover the same risk: death. Although each one seeks to protect the economy of the affected relatives, they do it in a different way and offer different guarantees. At Allianz we explain the difference between life insurance and death or funeral insurance.
When a loved one dies there are many issues that must be assimilated. On the one hand, there is the pain that the loss of a relative causes in itself and, on the other, a series of administrative procedures that not only involve time, but also money.
The family economy is another issue that is affected when the person responsible for supporting the home dies. In both situations, taking out insurance that protects the insured’s family in the event of their death can make a difference, even in the quality of life of the family unit itself.
Difference between life insurance and death insurance
Funeral insurance coverage
The administrative procedures and expenses related to the insured’s funeral (cremation, burial, burial, tombstone, funeral home, national and international transfers, etc.) are included in the coverage of a death insurance.
Depending on the modality you choose, a burial insurance can also offer other services such as travel assistance, digital deletion and psychological assistance for family members.
Life insurance coverage
Other differences and similarities between life insurance and burial insurance
Who determines the capital in each policy?
How is the premium to be paid determined?
In general terms, the premium that must be paid until the accident occurs, in both cases, will depend on the age of the insured, the coverage contracted and other factors that determine the risk of insuring the interested party. Both life and death insurance take into account the sum insured when specifying the premium, however, in death policies said sum may vary over time. The life insurance no.
This basically happens because when we take out life insurance, the amount is decided from the beginning, so the premium will only vary if the policyholder decides to increase or decrease the compensation that their relatives or loved ones will receive when they die. In funeral insurance, the premium may vary depending on the increase in prices of the services necessary to carry out the burial of a person.
How is the incident reported?
Hire life insurance or death insurance?
Both insurances are highly recommended and compatible with each other, but if you have to decide on one of them, it is best to carefully evaluate what would be the needs that the people who depend on you will most urgently need to cover in the event of your death. Establish priorities and based on this, choose one or another policy.