Advertisements for affordable funeral insurance are popping up everywhere – enticing adults to purchase the product so their family will not face financial trouble upon their death. However, Cigna New Zealand has warned consumers to think twice before buying the product without looking into its policy.
Gail Costa, chief executive of Cigna New Zealand, said that funeral insurance is suited to people aged 50 or above so they can plan ahead for their funeral and therefore help their family avoid financial stress.
However, she pointed out that some products only cover as little as $3,000 to $5,000 – which may not be enough for the kind of funeral that some customers want.
“We advise customers to keep an eye on their policy [to] ensure they maintain the cover [amount that] they can afford and is right for their needs. A payout could be more or less than [the amount] paid in premiums,” Costa told Newshub.
A spokesperson for a well-known funeral company said people are now moving away from traditional funerals – with direct cremations on the rise as people prefer their ashes to be with their loved ones without the hassle of a formal funeral. It also usually costs only $2,000 compared to a burial plot that ranges from $3,000 to $7,000.
“You have to have the right funeral for your family. The grieving process is different for every person, (not necessarily from A-to-B) and a formal service gives people a time and place to grieve,” the spokesperson told Newshub.
“[Planning] helps to ensure that people make informed choices, that they get the service they require and also takes stress away from the family.”
