Choosing Funeral Insurance

Nobody likes to think about it, but a funeral can easily cost thousands of euros. On average, you'll pay between 7,000 and 12,000 euros for a funeral in the Netherlands. That's a hefty sum that your loved ones could suddenly be faced with if nothing has been arranged. Funeral insurance prevents that. But how do you choose one that truly fits your needs?

The range of options is wide, the terms differ per insurer, and it feels like a topic you'd rather not dwell on for too long. Still, it's smart to do your research properly. In this guide, we walk through everything you need to know to make a good choice, step by step. No complicated jargon, just clearly explained.

Why take out funeral insurance?

You don't arrange a funeral for yourself, but for the people you leave behind. Without insurance, your loved ones are stuck with all the costs. Think of the funeral director, the coffin or urn, transport, mourning cards, catering, and the cemetery or crematorium. It adds up quickly.

With funeral insurance, you know for sure those costs are covered. Your loved ones don't have to worry about money on top of an already difficult moment. It also gives you the chance to think ahead about what you want. Do you want to be buried or cremated? A large ceremony or something intimate? By putting that down in advance, you take a lot of decisions off your loved ones' shoulders.

Tip: Discuss your wishes with your partner or family. It might feel uncomfortable, but it helps enormously when choosing the right insurance. You'll have a much better idea of what you need to cover.

What types of funeral insurance are there?

There are roughly two types of funeral insurance: in-kind insurance and capital insurance (also known as cash insurance). The difference lies in what you receive.

With in-kind insurance, you don't receive money but services. The insurer arranges the funeral and pays the costs directly. Think of preparing the deceased, arranging the venue, and transport. A major advantage is that your loved ones have very little to organise themselves. A company like DELA is a well-known example of an insurer offering this type of service insurance.

With capital insurance (or cash insurance), a lump sum is paid out to your loved ones upon death. They can spend that amount freely on the funeral. This gives more freedom in choosing a funeral director, but it also means your loved ones have to arrange everything themselves. Insurers like DELA, ASR, and Monuta offer this type.

There are also combination policies that offer a basic package of services, supplemented by a cash amount for additional wishes. Which form suits you best depends on how much you want to arrange yourself and how much freedom you want to give your loved ones.

Tip: Want your loved ones to have as little to arrange as possible? Then in-kind insurance is often the better choice. Is freedom of choice more important to you? Then look into capital insurance.

What does funeral insurance cost?

The premium for funeral insurance depends on a few factors. The most important are your age at the time of taking out the policy, the insured amount or package, and whether you smoke. The younger you are when you take out the insurance, the lower the monthly premium.

For an adult around 30, you can expect to pay between 10 and 20 euros per month for good coverage. If you take out the insurance later, for example around 50, the premium can rise to 30 euros or more per month. At older ages it becomes even more expensive, and some insurers set a maximum entry age.

Besides the monthly premium, it's wise to look at the total amount you'll pay over the entire term. It can happen that you end up paying more in premiums than the insured amount. That might sound odd, but remember that insurance also covers risk: if you pass away unexpectedly young, you may have only paid a few months of premiums while the full funeral is covered.

Also check whether the premium is indexed. With indexation, your premium rises slightly each year, but the insured amount rises with it. This protects you against inflation: a funeral that costs 8,000 euros today could easily cost 12,000 euros in 20 years.

Tip: Request a quote from a few insurers and compare not just the monthly premium, but also the total amount over the full term and the coverage conditions.

What should you look out for when comparing?

When comparing funeral insurance policies, it's about more than just price. There are a few important points to watch for.

Coverage and insured amount. Check carefully what's actually covered. With in-kind insurance, the terms state which services are included. With capital insurance, the insured amount is what matters. Check whether that amount is realistic enough to pay for a funeral, taking future price increases into account.

Waiting period and medical screening. Some policies have a waiting period. This means that during the initial period (often one or two years) you're not yet fully insured. If you pass away during that period, your loved ones may only receive the premiums paid back. A health declaration or medical screening may also be required. Policies without medical screening do exist, but they're generally more expensive or come with a longer waiting period.

Accrued value and surrender value. Some policies build up a value that can be paid out if you want to cancel the insurance early. That's called the surrender value. Not every policy has this, so check if flexibility is important to you.

Indexation. As mentioned earlier: with indexation, your insured amount grows in line with inflation. Without indexation, you run the risk that the insured amount won't be sufficient in 20 or 30 years.

Tip: Make a checklist of the five points above and go through them for each insurer. That makes comparing much more manageable than trying to keep everything in your head.

Common mistakes when choosing

There are a few pitfalls that many people fall into when taking out funeral insurance. Good to know about them, so you can avoid them.

Only looking at price. The cheapest premium isn't necessarily the best deal. A low premium can come with limited coverage, a long waiting period, or no indexation. Always look at the full picture.

Waiting too long. The longer you wait to take out a policy, the more expensive it gets. And at some point, you might not even be eligible anymore, for example due to your age or health. Starting young saves you a lot on premiums.

Not reading the fine print. Yes, policy terms aren't exactly thrilling reading material. But it is important to know what's covered and what's not. Are there exclusions? What happens if you miss a payment? How much do you get back if you cancel the policy?

Insuring too low an amount. Sometimes people deliberately choose a low insured amount to keep premiums down. But if that amount isn't enough to pay for the funeral later, your loved ones will still have to cover the difference. Keep the actual costs in mind.

Being double insured without knowing it. Check whether you're not already (partly) insured through your employer, trade union, or another collective scheme. It would be a waste to pay double.

Tip: Check whether you already have (supplementary) funeral insurance through your employer or another organisation. It could save you a fair amount in premiums.

What if you already have funeral insurance?

If you already have funeral insurance, it's sensible to review it from time to time. Does the coverage still match your wishes? Is the insured amount still sufficient? Are there better or cheaper options on the market by now?

Switching to another insurer is possible, but be careful: a new policy may come with new waiting periods and require a fresh health declaration. On top of that, your age is now higher, meaning the premium at a new insurer could be higher than what you're currently paying. So switching isn't always the better deal.

What you can always do is put your current policy alongside a few others to see how it compares. You might be perfectly fine where you are, or you might spot opportunities to improve your coverage.

Tip: Set a reminder in your calendar to review your funeral insurance every three to five years. Your life situation and the market change, and your insurance should be able to move with them.

In conclusion

Choosing funeral insurance doesn't have to be complicated. It comes down to a few core questions: what type of insurance suits you, what level of coverage do you need, and which insurer offers the best terms for your situation? By taking the time to compare and read the fine print, you prevent surprises down the line.

The most important thing is that you arrange something. The exact choice matters less than taking the step to do it in the first place. Your loved ones will be grateful.

Want to see which funeral insurance suits you best? Compare funeral insurance policies and discover your options.