Helpful Articles

Helpful Articles

Sep 20

How Funeral Insurance Differs From Funeral Bonds

Posted by Integrity Funerals

Planning a funeral can be expensive. Because of this, more people are looking ahead to make sure that some of these costs are taken care of. Two of the most popular ways of doing this are through funeral insurance and funeral bonds. So, how does each option work, how are they different, and what’s the right approach for you?  Here’s what you need to know.

What Is Funeral Insurance?

Funeral insurance is a policy that will give your family a lump sum payment when you pass away. The policy you select will determine how much they will receive. You will need to pay for this policy in regular intervals, either fortnightly or monthly.

What Are The Pros And Cons Of Funeral Insurance?

One of the biggest reasons why people choose to use funeral insurance is to split the cost of their funeral into manageable chunks. You will have instant coverage once you take out the policy.

The downside is that the older you get the more you will need to pay for the coverage. Furthermore, there is a range of exemptions that might see your policy denied. For example, it’s common for only accidental deaths to be covered for the first few years of your policy.

What Are Funeral Bonds

A funeral bond is a little like a savings account. You will be able to deposit money on a flexible timeline. This money is held in a secure trust with your funeral director. When you pass away, it will be used to pay for the funeral costs.

What Are The Pros And Cons Of Funeral Bonds?

There are a few reasons why people like funeral bonds. First, you will be able to deposit up to $13,000 into the bond without it affecting your pension.

Secondly, you will be able to make flexible contributions to your funeral bond account. If you prefer, you can make donations once a week or once a month, depending on your financial situation.

However, only the amount that you have saved in funeral bonds will go towards your funeral. This means that your family can still be left with a shortfall if you pass away early.

Furthermore, your funeral bonds should grow in value over time, as they earn interest. The downside is that there is no guarantee that the growth will keep up with inflation.

Other Ways To Pay For A Funeral

While funeral insurance and funeral bonds are the most popular options, there is a third option. You can choose a pre-paid funeral. In this case, you will pre-plan the event with the funeral director. Then, you can lock in the current prices and set up a payment plan. Similar to a funeral bond, these funds are held in a secure trust. This option has the added benefit of ensuring that your family won’t have the stress of planning your funeral.


No one wants to leave their family with a financial burden when they pass away. Thankfully, there are some simple ways you can pay for the costs of your funeral. This will give you the peace of mind that comes from knowing that your loved ones will be taken care of when you pass away.