There are many different kinds of funeral policies. Some are group policies, some are individual policies covering one life or extended families. These policies are sold in many different ways: directly to consumers by insurers, through sales people, or by banks or shops, or through membership of other organisations. Most funeral policies do not have any savings element, but some do. Some policies provide for a funeral service as the benefit. However, the policy must always also provide for a sum of money to be paid as an alternative to the funeral.
There are “scams” and illegal operators around. It is important that you deal with trustworthy organisations. Take your time and do not rush into a decision to buy a policy. Some general guidelines to follow when buying funeral insurance.
If you are buying a funeral policy from a salesperson always make sure that the person has a licence from the Financial Sector Conduct Authority ("FSCA") previously the Financial Services Board (“FSB”) to sell insurance. Ask the person to show you their licence.
Make sure that you know who the insurer is. Funeral policies are often administered and sold by third party funeral administrators or retailers. It is important to know who the insurer is who underwrites the risk. Make sure of the contact details of the insurer and the funeral society if applicable.
If there is an application form, fill it in yourself if you can. Make sure you read everything on the form including the fine print above your signature. Make sure that any information you give at sales stage, telephonically or in a form, is correct. Describe family relationships accurately.
If there are any questions or declarations about your own health or any other life assured’s health, make sure that you disclose all the important information. When you claim and the insurer finds out that you did not disclose material information on the form the insurer could cancel the policy and not pay the claim.
You must be given or sent a policy or a policy summary when your application is accepted. Insist on seeing the document. Read it and make sure you understand it. If not, phone and find out what it means. If it does not reflect information correctly have it corrected. Make sure that you agree with the information given in the policy, such as who the policy owner is.
You have a 30 day “cooling-off” period after you receive the policy or summary to cancel the policy, if you are not satisfied with it.
Make sure that your premiums are paid every month on time. It is your responsibility, even if you are paying by debit order or stop order. Keep proof of payment. If the premium is not paid the policy may be terminated and a claim may be refused. There is a grace period (15 days or longer, depending on the policy) after the due date when cover continues, but after that no benefits will be paid.
If you have any dealings with a salesperson, the administrator or the insurer, keep written proof thereof.
Make sure that any beneficiary nominations (where you nominate the name of the person who must receive the benefits on your death) are up to date and still reflect your wishes.
When a life assured (the person covered by the policy) dies, the claimant must submit the claim as soon as possible. Check in the policy how much time there is for a claim. If the claim is late the insurer can refuse to pay the claim. The required documentation must be submitted before the insurer will consider the claim, this may include the requirement of a computerised death certificate.
It is important that family members know about the policy and where it is kept in the case of your death.
If a claim is refused for any reason the insurer or administrator must give you the reasons in writing.
The Ombudsman for Long-term Insurance resolves disputes between subscribing insurers and policyholders or claimants. If you are not able to resolve a complaint with an insurer, then you can write to us. Our service is free. Our details are: