Getting burial insurance for a brother is an affordable way to secure your family’s financial future. It is also affordable to buy final expense insurance on your brother, sister, and mother as long as you have “insurable interest” and “consent”.
There are several burial insurance policies available if you want coverage for a brother or sibling. Most insurance companies offering these plans will consider your immediate family such as your parents as someone you have an insurable interest on (meaning that you must suffer a financial loss when he dies).
Today, it’s becoming common for siblings to take a life insurance policy on their brother because they don’t want to shoulder the final expenses when their brother passes away. They realize that it’s more affordable to invest in burial insurance now than be burdened with the funeral bills later.
No matter what company you go with when you want burial insurance for brother, he will not have to take physicals or medical exam to qualify. Also, he will not have to provide doctor’s records either. Burial insurance for brother is always done on a simplified basis. That means he would only need to answer a few health questions.
In this article, we will learn the different requirements to be able to get burial insurance for your brother and how to choose the best plan at the best price.
CAN I GET LIFE INSURANCE ON MY BROTHER?
YES. Absolutely! You can get a life insurance policy on your brother. In order to take out a life insurance policy on your brother, you will need to meet some requirements:
1. INSURABLE INTEREST
You need to prove insurable interest before you can get life insurance on your brother. A relationship based on blood may provide insurable interest, but you must show that you will experience financial loss when your brother dies.
Insurable interest is the reason why you can’t just buy life insurance on anybody if that person’s death will have no significant effect on your finances.
It is illegal for life insurance providers to sell insurance policies on people without proving insurable interest. It is required by law to ensure that the death of the insured would not create personal gain on the policy owner.
Allowing people to own life insurance on just anybody could lead to foul play or murder to get insurance payouts.
Aside from insurable interest you also need your brother’s permission to buy life insurance policy on him. Your brother needs to agree that you will take out a life insurance policy on his life.
It would nearly be impossible to buy burial insurance on your brother without him knowing about it because the life insurance company would require his signature on the application. Even no exam policies such as simplified issue and guaranteed acceptance policies require the signature of the insured.
The insurance companies need the signature of the applicant to access their medical history. According to HIPAA, the insured must give written consent to access all his medical records. If somebody managed to take out life insurance on another person without their permission, it would be considered insurance fraud which is punishable by law.
The only exception to this rule is if you have a power of attorney for your brother. Some insurance companies would allow you to sign the application when you submit proof of power of attorney.
What if my brother is not close by to sign the life insurance application?
You can still take life insurance for your brother. Most life insurance companies only need recorded verbal consent and digital signature. We can accomplish the application over the phone or on your computer. But if your brother wants to sign the application form, it can often be mailed to him to fill out and return.
WHY DO YOU NEED TO TAKE OUT BURIAL INSURANCE ON YOUR BROTHER?
There are many reasons you may want to purchase life insurance on your brother:
- You may need to take out burial insurance for a brother if you depend on him for financial support. For example, permanently disabled or handicapped, and your brother take care of you. You have an insurable interest because you will be negatively affected upon his death.
- You can consider taking out life insurance on your brother if he cannot afford to buy a policy for himself. If he is unemployed without insurance, taking out a policy on him will not leave you with a financial burden when he passes away.
- If your brother has a disability or other health issues like autism, cerebral palsy or Down’s syndrome you may need to take burial insurance for him because his death will leave you with the final expenses.
- It is also wise to take burial insurance on your brother if he has no money saved for his final expenses. If he went bankrupt and was left with no savings, you can purchase burial insurance on him. When he passes away, your family would be left to deal with the burial cost and everything that comes along with his passing away.
- If your brother has a personal loan, this it’s a good reason to take out burial insurance for him. Example, your brother owes you the money you borrowed for his education, or an auto or home loan. Taking life insurance on your brother can make a sound financial sense to ensure any unpaid debts can be paid off when he passes away.
- You may need to take out a life insurance policy on your brother if he has a pre-existing medical condition like emphysema, COPD or cancer and he is afraid that he will not qualify for life insurance on his own.
- You should consider taking out life insurance on your brother if he doesn’t like to talk about death or the day he will pass away. If he is in the stage of denial that death wouldn’t occur to him and he doesn’t have life insurance for this reason.
- If you are in business with your brother, then life insurance may be purchased on his life for business purposes. Life insurance can be a part of a buy/sell agreement. When your brother dies, you will be provided with the funds needed to buy out the other half of the business. The death benefit will fund the buy/sell agreement.
Buying life insurance on your brother can be affordable, depending on the type of plan and the amount of coverage, and the insurance company you chose to buy the policy. So, whether you are worried about covering final expenses, paying off debts, or other financial obligations, we can help you get the plan that’s right for your brother.
INFORMATION WE NEED IF YOU WANT TO GET LIFE INSURANCE ON YOUR BROTHER
Before you take life insurance on your brother, it’s essential for you to supply us all the necessary information about the proposed insured. It’s is important, to be honest when answering these questions.
Here are the questions that will help us determine what he will qualify for:
- Who will be paying for the insurance coverage?
- How much coverage are you interested in?
- Does your brother have any chronic illness?
- What health issues does he have?
- What medications is your brother taking?
- Does your brother been hospitalized within the last 24 months?
- Does your brother have any heart attacks, strokes, or cancer?
Depending on your answer to these questions, we will be able to get a good idea about your brother’s health. We will analyze this information to determine what plan is best for him and what burial insurance company will be the cheapest.
BURIAL INSURANCE OPTIONS FOR YOUR BROTHER
SIMPLIFIED ISSUE BURIAL INSURANCE (NO MEDICAL EXAM)
If your brother is in good health with no major health issues, simplified issue burial insurance with no medical exam is a great option.
You can buy a simplified issue burial insurance for your brother. It only asks a few health questions you can answer with a Yes or No. The application and underwriting process is relaxed and quick.
Simplified issue whole life insurance has immediate coverage and does not have any kind of waiting period.
Your brother will get instant coverage if he qualifies for simplified issue burial insurance. He will be covered from day one, and his beneficiary will receive the full death benefit payout if he passes away for any reason.
He will be asked to answer a few health questions to determine if he will be eligible for coverage and how much you will pay. Depending on the insurance company, your brother might be disqualified for simplified issue life insurance if:
- He is in a nursing or assisted living facility.
- He’s been diagnosed with a terminal illness like cancer or kidney failure.
- He has impaired mobility, and you need a wheelchair.
- He has cognitive impairments like Alzheimer’s disease or dementia.
- He needs assistance with ADL – activities of daily living.
- He needs oxygen because of COPD or any lung disease.
Simplified issue burial insurance is a good insurance alternative if your brother can’t qualify for fully underwritten life insurance because of a pre-existing medical condition.
Even if your brother has some health issues, he can still qualify for simplified issue burial insurance. Life insurance companies offering simplified issue policies usually only look at the medical records on the MIB and perform a prescription check to determine eligibility.
This means if your brother has been declined with traditional term or whole life insurance he has a better chance of getting approved with simplified issue burial insurance.
For example, your brother had prostate cancer five years ago. Most simplified issue plans only look back at the last two years on cancer history. Not only would he be approved, but he will get preferred rates with many companies.
Even with other medical conditions, getting a simplified issue final expense insurance on your brother can have him potentially covered from the first day.
GUARANTEED ISSUE BURIAL INSURANCE (NO HEALTH QUESTIONS)
If your brother is in really bad health, for example, he’s got cancer or cardiac problems. It is still possible to get burial insurance coverage on him. You can get guaranteed issue burial insurance even if your brother has a terminal illness or if he is in very bad health.
You can purchase guaranteed issue burial insurance for your brother and he will not be required to take a medical exam or answer health questions to qualify. He can be approved for insurance coverage regardless of his current health or pre-existing medical conditions. The company will not look at his prescription history or MIB.
This is a great burial insurance plan if your brother cannot qualify for a simplified issue with immediate coverage.
Time is the most significant benefit of guaranteed acceptance policy. Some companies can approve your policy in less than 48 hours others in just 15 minutes. This is the best option for those who need life insurance coverage for their brother quickly due to court or business loan requirement.
His premium will be based on his age, gender, and state of residence. You can buy face amount from $2,000 to $25,000 range. If you only need life insurance to cover your brother’s funeral and final expenses, guaranteed issue burial insurance which can be bought online can be your best option (we can help you with this).
Guaranteed issue burial insurance has a graded death benefit, which means the company will only pay the full death benefit if your brother dies from an accident during the waiting period.
If he dies from a natural cause or an illness during the two-year waiting period, you will only receive all the premiums paid into the policy plus 7-10% interest. If your brother dies for any reason after the waiting period, you will get the full death benefit.
AVOID THE TAX TRAP WITH THE RIGHT LIFE INSURANCE SET UP
When purchasing burial insurance for brother, it’s crucial to set up the life insurance policy right because you can fall into a tax trap if your brother’s life insurance policy is not handled carefully. The death benefit payout is usually tax-free unless the insured, the owner and the beneficiary are three different people. This case is called the Goodman Triangle.
The beneficiary can be taxed on the life insurance death benefit if the insured, policy owner and the beneficiary are three different people.
- The Insured – The insured is the one covered by the life insurance policy, in this case, your brother whose death will result in a death benefit payout.
- The Owner – The owner of the policy is usually the one paying for the insurance policy which holds the rights to the life insurance contract. The owner can make changes to the policy such as changing the beneficiary, adding or deleting riders, lowering the death benefit, transfer ownership, and request a rating change for the insured.
If you are the owner of your brother’s life insurance policy, you will have to submit proof of insurable interest.
- The beneficiary – the beneficiary is the one designated to receive the life insurance payout. Designate yourself to be the beneficiary to avoid the tax trap.
The Goodman Triangle can happen this way:
An older sister owns a life insurance policy on his younger brother. The policy owner named her son as the beneficiary. In the eyes of the IRS, the insurance payout is viewed as a gift to her son, and it would be taxed accordingly. The older sister would be taxed on the gift she gave to her son.
How to avoid the Goodman Triangle and the Tax Trap
The Goodman Triangle can be avoided by making the two points of the triangle the same person. In the example above, if the older sister is both the owner and the beneficiary, then the Goodman Triangle doesn’t happen.
Be careful when setting up your brother’s policy to avoid the Goodman triangle and the tax trap that goes with it. Avoid making the insured, owner and beneficiary three different people.
HOW CAN FUNERAL FUNDS HELP ME?
Trying to find a policy if you need burial insurance for brother needn’t be a frustrating process; working with an independent agency like Funeral Funds will make the process easier and quicker.
If your brother has a pre-existing medical condition we will help you; we will work with you side by side to find a plan that fits your needs.
We will work with you every step of the way to find the plan that fits your financial requirements and budget. You don’t have to waste your precious time anymore searching for multiple insurance companies because we will do the dirty work for you.
We will shop your case to different insurance carriers and get you the best price.
We work with many A+ rated insurance carriers that specialized in covering high-risk clients like you. We will search all those companies to get the best rate. We will match you up with the best burial insurance company that gives the best rate.
We will assist you in securing the coverage you need at a rate you can afford. So, if you are looking for funeral insurance for brother,
or burial insurance for brother, or life insurance for brother. Fill out our quote form on this page or call us at 888) 862-9456 and we can give you an accurate quote.