When Does My Burial Insurance Begin? – Podcast Episode 25

In this podcast I’m going to be discussing when does my burial insurance begin, the first thing you should be aware of is that you will not have any burial insurance until you apply, and then get approved. And then you make the first premium payment.

Think about this, if you have a car, if you just got a quote for car insurance, and you are actually approved for it, but you never actually paid the first premium, and then you got in a car accident. contractually, you haven’t fulfilled your end of the deal, the contract delight the auto insurance contract for them to have to reimburse you because it’s an exchange of services, it’s a transfer of risk. And for that to happen, you will have had to paid them money. And at which point they would tell you, Hey, your insurance coverage is in force. And now we will if you get in a car accident, we will repair or replace your car.

1:32

It’s the same way with burial insurance, you can apply, you can be approved, your policy can be pending. But until that first premium payment is made, or drafts out of your account, there is no insurance coverage. Because you have to pay that money to actually have the benefit. It’s like you can’t, you can’t get five pounds of hamburger from the grocery store, if you don’t pay for it.

You know, if you walk out that’s walk out of the store with five pounds a hamburger without paying for it, that’s not a good thing. Same thing with this insurance, if you just get approved, that you haven’t paid for it, you die, that’s not a good thing. So yeah, just understand that your policy will go in force, the minute your first payment drafts, not the Approval Date, that when you make your first payment.

2:27

So what we typically do at funeral funds of America is we will get somebody approved with the insurance company. And we can do that any day of the month. But a lot of times people don’t want their premiums to occur, like in the middle, or the end of the month from when they get paid. So typically what we help people with and it’s your preference, we can help you either way. But what most people like is they like to get approved right away.

And then typically, we would delay the first premium until their payment date. And typically that payment date is on their social security or disability pay day. And that’s generally the first of the month, a third of the month, or the second Wednesday, third Wednesday or fourth Wednesday of the month, just depending when they were born and when the government actually has determined that they’re going to pay them.

3:19

So we work with insurance companies that if you want to be billed on the first or the third of the month, that’s a okay. We also work with companies that have billing that coincides with Social Security payments. So that could be on the second Wednesday, the third Wednesday or the fourth Wednesday. And it’s important to note that we don’t deduct the premium from your Social Security, the Social Security drops into your checking or savings account.

And then we just set it to draft out of that same account. And that way, what’s really nice, is the money will always be there for your policy. So it will never lapse. The other thing too is once that money drafts out, you know exactly how much money you have to spend the rest of the month. And it’s just like on automatic pilot, and people love, love the flexibility of doing it that way.

4:11

The other aspect of when does my burial insurance begin is It depends if you have first day coverage, or a two year waiting period policy or there’s even some policies out there that have three year waiting periods. Why would you ever get one of those? I don’t know. But some companies sell them and some insurance agents push them as well. Which is ridiculous. Yeah. So obviously what we recommend, and what we help people with at funeral funds in America is first aid coverage or benefits.

4:46

We don’t sell even sell a two year or three year waiting period plan. We figure there’s enough companies out there that kind of take care of that they can kind of occupy that space they can have that that type of policy there the riskiest policies out there the most expensive expensive policies out there. And, you know, we’re out to help people get the least expensive coverage help them get the most amount of coverage for the least amount of money.

And in our opinion, two year and three year wait policies do not handle that effectively for us. So first a coverage. What that means is that hypothetically, if your policy were issued, and approved and went into force, today, meaning you’d made your first payment, and you died tomorrow, it would pay out 100% of the death benefit, whether it be 10,000 15,000 20,000, whatever it would be, with a two year and the two year waiting period plans, they’re not going to pay out any death benefit in the next two years. If you die of any health or medical reason.

Yeah, it’d be kind of like getting car insurance. And they said, Hey, if you crash your car, or having an accident in the next two years, you’re gonna have to pay everything yourself, we won’t, we won’t help you in any way that you’ll have to make those premium payments for the next two years. Nobody would put up with that. So now just keep that in mind.

6:07

You want first day coverage or benefits and 90 to 95% of the people we work with, are going to qualify for first aid coverage or benefits. And then there’s some plants out there that are called modified plants, they’ve got three year waiting periods, and you might get 30% of the coverage. So let’s say it’s a $10,000 policy, you get 30% in the first year, which is 3000, which if you’re getting a burial, it doesn’t do a lot of good. And you’re to you would get 7000. So it’s like 70%.

And it’s not until after year three, which is a full 36 months would you get the 100%. The, it’s pretty crazy, those modified plans are in many cases, more expensive than the two year waiting period plans, depending on the company. It’s almost like, you see a lot of those with captive agencies and agents, they only sell policies from one company, meaning they work for that one company.

7:03

And a lot of people get denied just because they don’t often cover as many health problems is some of the other insurance companies we’re working with. And it’s like, they really want people to, to do the first day coverage with us. But it’s it’s as if they kind of almost want to discourage people from buying the modified. And they’re, it’s almost like they’re like, You know what, we don’t want this business, that if we’re gonna take it, we’re gonna make it really profitable. And take a lot of money.

So yeah, and it just man three years is a long time, holy cow. Yeah, you want to avoid those plans, if we would always recommend, I think in most cases a two year waiting over a three year number one financially, but also you just get that full coverage a full year earlier. And another aspect of when does my burial insurance begin is just just starts depending on the policy first day, whatever it is, the number one rule, though, is after your insurance begins, you want to stay in force.

So keep making the payments. And as long as you’re making the payments, you’re gonna have permanent coverage. And you don’t want to let your policy lapse at any point in the future. Because say you got approved at age 55. And you let your policy lapse and you know, now now you’re 65. Now you’ve got to come back and try to qualify for that coverage. But here’s the deal, the insurance is going to be more expensive, because you are now 10 years over.

8:39

So there’s some there’s some policy adjustments with that we can actually make some kind of settings within the policy, that if you miss a payment or you change a bank or your your something happens with your bank account in the bank shuts the account down or gets frozen and a payment isn’t isn’t made, we can actually set it up so that it can borrow out of the cash value in your policy to make that payment and keep your policy in force. It’s a really nice financial safety net for your for your policy.

And we we always recommend you pay that Paul to pay that premium back. And that keeps your full death benefit in force. And then it also just eliminates any interest charges on the amount of money that you were actually borrowing from the cash value of your policy. And then the other thing that’s almost as support is when does my burial insurance begin is when does it end? So a couple of ways to look at that so it with us you’re gonna have first aid coverage or benefits or we will refer you to an appropriate company that has the best two year waiting period if that’s if you just waited too long. And you know you have too many health issues.

9:52

And I’m just going to be kind of tough love Randy here. That’s that’s not our fault. That’s not our fault if you waited too long. Long, you know, there was a time in your life more than likely 99% of the time that you qualified for first aid coverage, and you just kept putting this off. So it falls you qualify for two year is for two year coverage that’s on you, that’s not on us. And we will just do our best to help you in any way we can. But yeah, get that first aid coverage.

And then also, when you get your policy, if you go through us, we will always explain every aspect of your policy. So there’s no surprises, that you know exactly what to look for, when you get your your actual insurance policy. And we always recommend you review your policy, there’s a free 30 day free look period on every single one of these policies, with all the different insurance companies, when you finally do get your policy in the mail, make sure and review it. There’s some some companies out there that advertise and you know, those 997 plans you see on TV, and they make it sound like a big deal. Like they’ve got this exclusive thing with them, that you’ve got 30 days to review your policy.

11:12

That’s called Marketing. That’s called great marketing. Right? You know what, because every company offers that. So and what that’s designed to do, is it if you were, if you were pressured into buying a policy that you didn’t want, then you could actually get a refund of your premium. If you actually got the policy and you reviewed it.

And something was different than the agent told you. You could get a refund if you got your policy in the mail. And you notice that the agent lied or misrepresented something on the application typically, typically that would be about your your health, your your medical health, or like smoker status or something like maybe they wrote you down as a nonsmoker to get a better rate just hoping to try to sneak it by the insurance company.

You know, take a look at that you do that that policy will not stand up over time. If because you’re the one that signed it. The insurance agent may have filled it out, but you’re the one that signed it. And if they find out that you were indeed a smoker and the agent wrote you are a nonsmoker just to try to get you better rates.

The insurance company does not have to pay for payout that death benefit. After you pass away. That’s called insurance fraud. You’d lied on the application, they would have never approved you for that rate if they’d known the truth. So honesty is the best policy. So again, we always recommend first state coverage and your policy is going to start when your first payment is made. So I hope that helps you understand when your burial insurance starts and begins.

NOTE: Show notes are AI transcribed, so there may be some spelling or grammatical errors.