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How is funeral insurance premium determined?

Do you choose to take out funeral insurance? Then you will undoubtedly take a lot of worries away from yourself and your loved ones, as the financial side of your funeral will no longer be a problem. Of course, you have to pay a premium for this insurance to enjoy the benefits. It pays to research in advance exactly how high that premium is.

What exactly determines the premium you pay for funeral insurance and what should you look out for? Questions that deserve answers and you get them here.

Premium funeral insurance flower

How is funeral insurance premium determined?

The premium you pay for funeral insurance actually refers to the amount you pay to finance your funeral later. The insurance means that you transfer a certain sum to the insurer each month, building up a large sum of money over time. After you die, the insured amount can be used to pay for your funeral.

Determining the premium for funeral insurance is simple in itself. A few factors play a role here, including the amount insured itself, the insurer you choose and more. The overview below will help you clarify these factors.

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4 key premium determinants in funeral insurance

1. The age at which you take out insurance.

First, the age at which you take out funeral insurance will affect exactly how high the premium is. A younger person who takes out such insurance usually pays less because the insurer realizes that the risk of death is a lot lower than for an older person. The later you take out the insurance, the more you pay monthly.

2. The insurer you choose

In addition, the premium you pay for funeral insurance also varies from insurer to insurer. It is therefore a good idea to research the various options and compare them in terms of cost.

Typically, the monthly premium for funeral insurance for someone 18 years old is between 5 and 6 euros, depending on the insurer, but that amount naturally increases as you get older. That one euro difference doesn't seem like much, but after years it translates into a much larger amount to pay.

3. The insured amount

The insured amount is something that you, as the policyholder, are fortunately in control of and will largely determine how much you pay in monthly premiums. The insured amount is the amount your next of kin can use to finance your funeral. The higher that is, the more options there are, of course.

When choosing an insured amount or funeral package, it is important to keep in mind your personal wishes for the funeral and what costs are involved. Also remember that the premium is usually a bit lower if you choose a slightly more expensive package compared to a cheaper option!

3. Inflation and indexing

Finally, changes in the market will also affect the premium you pay for your funeral insurance. Inflation, for example, may cause you to pay a little more year after year anyway, as the insurer bases its premium on the ever-increasing cost of a funeral.

It is possible with your insurer to have the premium you pay for insurance automatically indexed. As a result, you'll pay a little more each year, but the result will be that you'll eventually have built up a large enough amount to fund your funeral later. Don't index? Then your monthly premium remains the same, but you may also end up not having enough left over to fund your funeral.

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