What Is The Difference Between Life And Burial insurance?

The question about what the difference between life and burial insurance is quite common. 

Contrary to what many thinks, although both provide peace of mind to their policyholders, they are not the same.


Both life and burial insurance are linked to the death of the insured person, which can often lead to identifying both coverages as the same.

In addition, both cover the same risk. That is, the loss of life, and they do so with an economic benefit, although not in the same way. Therefore, you must know how they differ, the coverage, costs, and other important aspects of choosing the one that best suits each situation.

To fully understand the characteristics and certain aspects of each type of insurance, we must understand what each of them means. That will help us know how they differ since we can constantly think that they are the same type of insurance, and it is not.


Life insurance is a type of insurance that guarantees a policyholder the peace of mind that their loved ones will be rewarded with compensation when they die. This compensation is called insured capital, and it will depend on the amount that life insurance has been contracted. Life insurance offers the option of being able to include additional coverage related to disability.

Therefore, when purchasing life insurance, the insurance company must study the possible risks, obligations, and personal situation of the insured. In addition, the insured capital can be paid with a single payment (when the insurance is contracted), or after a certain period.

However, the contracting of life insurance cannot be done thinking only about the possibility of death or disability. But rather as a guarantee of safety and tranquility in the occurrence of other situations, which are normally unpleasant. With life insurance coverage, such occurrence may become less of a concern. For example, in the case of any illness, it is possible to activate the insurance and be entitled to a special advance.


The burial insurance is a type of insurance in which the insurance company, in exchange for periodic payments during the contract with the insured, agrees to cover funeral expenses and other matters specified in the policy if the insured dies.

For example, in the case of the insured’s burial, they will be responsible for all the costs that relate to this event. Thus, the relatives or closest people will not have to be responsible for the expenses.

In addition to covering the death of the person, it is important to note that sometimes it usually provides certain services to the closest family members in such difficult times.

In addition, depending on the contracted plan, it is possible to guarantee the beneficiary of the deceased insured the right to receive a basic monthly income for a period of 12 months after the death, among other optional services offered by the insurer.

As you can see, both types of policies are contracted with the purpose of supporting the family at the time of death, but each of them in a different way.


Want to know more about what is the difference between life and burial insurance? We can imagine that it is somewhat confusing. But what are the differences, and how do you find out which coverage you want to take out? We explain more about their differences below.


The main purpose of life insurance is to protect the relatives or closest people of the insured when he dies. In other words, it guarantees that when the person who has this type of insurance dies or suffers a disability, family stability is not harmed.

The beneficiaries of the policy receive financial compensation. The protection of the human being and the closest people is essential in this type of insurance. The risk covered in life insurance is human life.

Regarding the purpose of burial insurance, we can say that it is to cover all the costs related to the death of the insured person who decided to take out the insurance.

This may include expenses such as burial, funeral home, mass, processing of death documents, etc. In this way, the relatives or those close to the insured do not have to bear these expenses or pay any amount of money. In this case, the risk covered by funeral insurance is burial expenses.


First, we must be clear that the coverages are the benefits that are in the insurance policy. Therefore, each of these two insurances that we are talking about will have different coverage.

The coverage of life insurance is usually:

I. The death of the insured

II. Permanent physical and profession disability due to accident or illness

III. Serious diseases such as cancer, kidney failure, transplants of vital organs, cerebrovascular accidents

Regarding the coverage of burial insurance, we have, for example:

I. The provision of the funeral service: burial, funeral home, mass.

II. Administrative procedures due to death

III. Travel and repatriation assistance

You should note that additional coverage can be added to the coverage mentioned above when the insurance policy is contracted. The more coverage the life insurance and the burial insurance contain, the more the premium that is paid.

  • COST

When hiring each type of insurance, insurance companies conduct in-depth research of the insured. This is done to determine the cost of the premium and the risk that must be covered.

Therefore, depending on the insurance you want to purchase, some aspects or others will be considered. This will make the premium become more or less expensive.

In life insurance, the insured chooses the amount he wants to include in the policy. This is the insured capital (capital that the family will collect when the insured dies). The cost of the premium will depend on:

I. The age of the insured: Insurance companies set an age limit based on the insurance policy. The older a person is, the higher the cost is going to be.

II. The state of health: Through a medical examination, the insurer can determine if the insured smokes, drinks, has any disease, etc. Thus, the more risk there is, the more expensive the premium

III. The trade or profession: If the person who is going to take out the insurance is employed in a fairly risky job, the premium becomes more expensive and the cost increases

IV. The insured’s hobbies: If the hobbies are going to the movies, the premium will be cheaper than if the hobbies are, for example, bungee jumping

V. The number of members in the family: How many people depend on the insured and how old they are. For example, the more children you have, the more expensive the insurance will be.

Burial Insurance

It is the insurance company that calculates the amount of money necessary to meet the expenses of the burial.

In this way, the insured chooses what to pay and the services they want to choose. In this case, the cost of the premium is based on quite similar aspects such as:

I. The age of the insured person: A person aged 80 is more likely to die where the premium will be more expensive than for a person aged 30

II. The place of residence: Depending on the province or country, the cost of the premium will be higher or lower. Just as there are differences if you live in a town or in a city.

III. The state of health: In this type of insurance a medical examination is not usually done, but questionnaires related to the health of the insured


As mentioned earlier, burial insurance comes in when organizing funeral services and procedures. Life insurance, on the other hand, offers financial compensation to family members once the insured has died.

When Life insurance is contracted, the insured chooses the capital that he wishes to include in his policy. That is the monetary amount that his family or loved ones will receive at the time he dies.

However, in the case of burial insurance, the interested party does not choose the capital directly. The amount is established by the insurer, taking into account the funeral services that they wish to hire when the time comes and where the burial will take place.


Another question that many people ask, “What is the difference between life and burial insurance payout time?” To start, the need to pay burial expenses is immediate. This means that with burial insurance, the beneficiary is always entitled to a benefit. And once the insured dies, the insurance company will avail all the necessary resources for the success of the burial.

With life insurance, it will take some time to collect the money after having delivered all the documentation required by the insurance company. Unlike in the case of funerals, their contracting is not usually done to meet the costs of the burial. This is because the compensation of the policy is not immediate unless an additional guarantee is contracted that includes it.

In addition, almost all insurance companies will refuse to pay out if the policyholder has given incorrect information about the state of health or has committed suicide. Even in the event of a murder, the insurance does not pay if the beneficiary is convicted as the perpetrator.


When a person has a family with economic dependence or the pension is low, they usually choose to take out life insurance. This is because, in the event that the person dies, their spouse, children, or beneficiaries of the policy will suffer less because of compensation provided by the insurance.

Therefore, this type of insurance is not ideal for single people or who do not have any type of family position. In addition, in life insurance, not everyone can contract it. Those under 14 years of age and those over 75 years of age tend to be outside the coverage offered by most insurers in the policy.

However, when considering contracting burial insurance, you must know that it is aimed at a larger group of people. This is because this type of insurance can be contracted by minors and older people over 75 years of age.

However, depending on the age, it will be advisable to take out one type of burial insurance or another since the risks tend to be different with age.


Fees paid to burial insurance are considered an investment. But in this case, the possibility of redeeming the invested money is not contemplated. In a burial policy, the investment is made exclusively to cover expenses arising from death. Therefore, it will remain in effect until the person insured dies.

On the other hand, life insurance is executed in the event of the death of the insured. However, if the insured arrives alive at the expiration of the contract, it will end without consideration by the insurance company. Thus, the money can be redeemed.


If you are thinking of hiring either of the two policies, study the benefits that each offer. Also, look at your circumstances and personal needs regarding them. You must not forget that they are not exclusive and that they can be complementary. Compare the coverage offered by each insurer and its products then decide which the best is for you.

In any case, you do not have to opt for one, but you can have both types at the same time in a complementary way. This way, you will be betting on your peace of mind and personal safety while protecting your family and loved ones. You have reached the end of the article. We hope that now you have understood what the difference between life and burial insurance is.

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