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A funeral plan in South Africa is an insurance policy that covers you and your family for the expenses associated with death. Where money is not paid out in cash to the spouse or dependants on the policy, various benefits are provided such as vehicle use and groceries for your family for a period of time following your death.

Affordable plans for you and your family

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A funeral plan is cover that removes the inconveniences associated with everyday life at a time when your family is grieving and may not be able to access funds to cover the cost of living as well as the funeral expenses. It is not a life insurance policy but like life insurance, it is paid out at the time of death or shortly thereafter.

Why is a funeral plan necessary?

Many will argue that no insurance policies are necessary and the same could be said for a funeral plan. However, it depends on your perspective in life. When you die, your family will have to fork out a large some of money to provide you with a send off that they deem fit.

Not only would they want to remember you with dignity in terms of proper funeral but there is also the social pressures to which they have to conform with. Nobody wants a pauper’s burial and even if you say that you are not around at the time to see it, nobody wants to see their loved one sent off without a dignified funeral.

In order to give you the funeral that your family sees as befitting means that they will have to access large amounts of cash. Funerals are not cheap. It is difficult to do even a basic funeral with less than R10,000 these days.

Who will your family turn to? Are they going to spend their life savings that could be used elsewhere? Will they not pay the rent, electricity or school fees to give you a befitting funeral? Will they borrow from friends, relatives or even small moneylenders to whom they will be indebted for may years to come?

A funeral plan covers these eventualities and ensures that your family does not have to beg and borrow at the time of your death. Whether it is necessary or not is for you to decide.

How much will a funeral plan pay out?

The payout on a funeral plan in South Africa depends on the amount of cover that you buy. You could purchase a funeral plan for as little as R29 per month or pay hundreds of rands in monthly premiums. You could be covered for anywhere from R5,000 to R50,000 or even more.

Some funeral plans through burial services may not put cash in the hand of your spouse or children but will instead ensure that all expenses related to the funeral is covered in full. But the expenses with death does not stop there. Even if your funeral is paid for, there are still other expenses before and after the actual funeral that may also need to be met.

It is therefore important to ensure that your funeral plan pays out a little more than just the funeral expenses.

Where to buy a funeral plan?

Funeral plans are available through insurance companies, banks and even through some burial services and undertakers. Buying a funeral plan these days is as easy as picking up the phone and completing the transaction within a few minutes. Your bank account will be debited every month or you can arrange a discounted rate with a financial services provider by paying an annual premium (a single amount every year).

It is important though to understand what you are buying in terms of the cash payout and other benefits of the funeral plan. Many consumers do not look beyond the monthly premium and may at times opt for lower cover. It is your family that ultimately pays the price for the shortfalls in your level of funeral cover.