What’s the difference between life insurance and a funeral plan? Avalon
When it comes to paying for your funeral in Spain, what’s the right choice for you and your family?
Have you thought about what your loved ones would do if you passed away in Spain?
It’s not a nice thing to think about, but if you’re an expat living in Spain, it’s essential to have a plan in place for your funeral. With unfamiliar customs, unexpected costs and language barriers, arranging a funeral in Spain as an expat can be complicated.
There are several ways you can make plans in advance and look after your family when the time comes. The most popular choices are expat funeral plans and life insurance. But how can you figure out which one is right for you?
Here are some of the key differences between life insurance and funeral plans, so that you can make the choice that’s right for you.
A funeral plan lets you plan your funeral in advance
The main difference between an expat funeral plan and a life insurance policy is that a funeral plan lets you choose what kind of funeral you want and make arrangements in advance.
A life insurance policy, also sometimes called life cover or over-50s cover, will pay out a cash lump sum when you die. This lump sum can go towards anything – it won’t necessarily pay for your funeral. It depends how your next of kin or beneficiary decide to spend it.
An expat funeral plan, however, specifically covers your funeral costs and arrangements. When the time comes, your loved ones simply make a call to the plan provider and they’ll put everything in motion. This makes funeral arrangements much simpler for your family.
An insurance policy could take weeks to pay out
When the time comes, insurance gives your loved ones a cash lump sum to help with expenses. But it could take anywhere from several days to several weeks to process and transfer the money – even longer if there are complications.
In Spain, funerals commonly take place within 48 hours of the person’s death. Expat funerals may take longer, but any delays will usually incur extra mortuary fees, paid by the day. In addition, most Funeral Directors in Spain ask for payment upfront before the funeral takes place. That means that in order to get the funeral arranged in a timely manner, your loved ones may need to use their own savings until the policy pays out.
However, a funeral plan makes this simpler because the funeral costs are already covered. There’s no need to wait for a pay out to arrive because all the arrangements are already planned and paid for.
With insurance you might pay in more than the policy pays out
With many standard life insurance policies, you have to keep paying monthly premiums until you pass away or at least until you are 90 years old. Depending on your specific policy, and how long you live for, you could easily end up paying more in insurance premiums than your family will receive when you die.
A funeral plan works very differently. You can pay in one lump sum, or flexible monthly payments, but once the total cost of your plan is paid for, that’s it. Your monthly payments stop and you can rest assured that everything will be taken care of when the time comes.
If you cancel life insurance, you could lose all your money
If you decide you don’t want your life insurance policy anymore, or miss a payment, you will in almost all situations lose everything you’ve paid in up to that point. That could be thousands of pounds. Read life policy cancellation terms very carefully before taking out life insurance to make sure this is the right thing for you.
Although funeral plans do have a cancelation fee its very unlikely you will lose your money. For example, a funeral plan with Avalon is more flexible should you have a change of circumstances that means you can’t afford your monthly payments anymore or need to re-budget we can advise and help you.
Make funeral arrangements simple with Avalon Funeral Plans
For expats in Spain, buying a funeral plan helps your loved ones cope with unfamiliar procedures, language barriers and funeral costs. An expat funeral plan helps make a difficult time a little easier.
Avalon is the UK’s most trusted funeral plan with over 1,700 customer reviews on Trustpilot. We provide peace of mind with prepaid funeral plans across the UK, Spain, Portugal and Cyprus.
Find out how you can make funeral planning simple with an Avalon expat plan.