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Are there any differences between funeral insurance and pre-paid funeral plans?
Yes. Funeral insurance works in a similar way to other insurance policies you're likely to have. You pay a series of regular premiums to cover an amount of your choosing. That amount – the funeral benefit – is then paid out at claim time or, with GIO's Value Promise, the amount you have paid in premiums if that’s greater. This money, awarded to your nominated beneficiary, is then used to pay for your funeral and other related expenses.
With pre-paid funeral plans, however, you plan and pay for your funeral in advance, meaning there's nothing to be paid for your funeral after your death. Costs are fixed, so you know you won't have to worry about the rising cost of funerals in the future. However, sometimes pre-paid plans can be difficult to amend if you need to – particularly if you've moved to a different state to be with your family, for example.