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  • Posted February 24, 2016

Why Everyone Needs Life Insurance

I don’t sell life insurance, and I’m not making a case for people to own it as an asset class. My reasons are much simpler than that – we will all leave this earth at some point, and when we do there is a cost associated with the disposition of our final remains. Some of us may have a prolonged illness, racking up medical bills. Others may meet their end in an accident or foul play. And many of us will simply not wake up one morning. This is not a fun fact, but it doesn’t make it any less true.

So we can either ignore it – which is in effect saying “it’s not my problem, why should I care – I won’t be here.” Perhaps this isn’t what you mean, but at the end of the day it’s what’s being said. Because if you pass away without any planning all the associated costs shift to your next of kin; adding to the weight of your loss. Or we can set aside resources to cover the basic expenses, and make it clear in your will what you want (cremation, wake, etc…).

Maybe you’re asking yourself – “how expensive can it be?”. The costs surprised me – it can be an expensive undertaking. Let’s explore just the basics for direct cremation, direct burial and complete funeral service. How you fund either is ultimately up to you, my suggestion would be to own a small whole life policy with enough coverage to meet what you want, adding a buffer for inflation. A Google search found a breakdown of final expenses (Final Expenses).

Cremation – no longer as simple as just cremating the remains, there are now an assortment of options including “green” cremation (source But in the interest of space, let’s explore your “cheapest” option, Direct Cremation. Prices ranging from $500 – $3,000 – and consumers are urged to ensure the cost of a cremation package includes the cremation itself.

Direct Burial – just what it sounds like, there is no wake or visitation and often the body is not embalmed. Prices range from $1,000 – $3,600; but these do not include a headstone, plot, and grave expenses (vault for casket, digging grave, etc…). You can expect to tack on a few thousand more when it is all said and done. 

Traditional Burial – visitation/viewing, embalming and transportation to the cemetery. Prices range from $2,620  – $6,000. Again, these prices do not include headstone, plot and grave expenses.

You may be thinking to yourself, “okay – it’s not as bad as I thought.” We need to factor in the funeral home’s basic services fees, which range from $480 – $3,000; the possibility the price of a casket is not included, which range from $50 (cardboard) – $12,000 (wood finish or metal); burial vaults, which range from $795 – $14,000 (preserves cemetery’s grounds) and a host of other a la carte services from an obituary to grave plot costs.

All things considered I think it’s a safe bet to plan on spending at a minimum $5k – $8k for a cremation and between $10k – $25k for a traditional burial. Obviously these are ballpark estimates, my intention is only to raise awareness. Do you really want your family running a “go fund me” campaign to cover your final expenses?! Taking out a small permanent policy, which could be paid for in as short as 10 years, will provide peace of mind and one less thing for your family and loved ones to come to terms with upon your passing.