Burial Insurance

Yes, these are.

Burial insurance, also known as funeral insurance, is a type of life insurance policy that is designed to cover the cost of funeral expenses after a person’s death. Medicaid is a government-funded healthcare program that provides coverage for low-income individuals and families.

When it comes to burial insurance and Medicaid, there are certain limitations that you should be aware of. In general, burial insurance is not considered an asset for Medicaid eligibility purposes, meaning that it will not count towards your income or assets when determining your eligibility for Medicaid.

However, there are limits to how much burial insurance you can have while still qualifying for Medicaid. In most states, the maximum amount of burial insurance that you can have and still qualify for Medicaid is $1,500. This means that if you have burial insurance policies that total more than $1,500, you may not be eligible for Medicaid.

It’s important to note that the rules around burial insurance and Medicaid can vary depending on the state you live in. Additionally, there are other factors that can impact your eligibility for Medicaid, such as your income and assets.

In the context of Medicaid, “spend down” refers to the process of reducing your income and assets to meet the eligibility requirements for Medicaid. The spend down process is also known as “medically needy” or “income spend down.”

To qualify for Medicaid, your income and assets must fall below a certain threshold. If your income or assets are above this threshold, you may still be able to qualify for Medicaid through a spend down program. Essentially, you would be required to spend down your excess income or assets on medical bills or other allowable expenses until you meet the eligibility requirements for Medicaid.

For example, let’s say that your income is $2,500 per month, and the Medicaid income threshold in your state is $2,000 per month. In this case, you would be over the income limit and would not qualify for Medicaid. However, if you have $500 in medical bills each month, you may be able to use the spend down program to qualify for Medicaid. You would be required to pay the $500 in medical bills out of pocket each month until your income falls below the $2,000 threshold, at which point you would be eligible for Medicaid.

It’s important to note that the spend down rules and thresholds can vary by state, and the process can be complex.

An irrevocable funeral trust is a type of trust that is set up to provide funds to cover the cost of funeral expenses. It is called “irrevocable” because once the trust is established, the grantor cannot change the terms or access the funds without the consent of the trustee.

The purpose of an irrevocable funeral trust is:

• to protect the funds set aside for funeral expenses from being used for other purposes, such as paying off debts or taxes. This ensures that the funds will be available to pay for funeral expenses when they are needed.

Typically, an individual will establish an irrevocable funeral trust by transferring assets into the trust. The trustee then manages the assets and invests them to grow the funds. When the individual passes away, the funds in the trust are used to pay for funeral expenses.

In addition to protecting funds from being used for other purposes,

• an irrevocable funeral trust can also help an individual qualify for Medicaid benefits. Medicaid has strict asset and income requirements, and setting up an irrevocable funeral trust can help an individual meet those requirements while still ensuring that funds are available for funeral expenses.

Unless you bought a term life burial insurance policy, most burial insurance plans are whole life insurance with cash values. This type of policy does not expire as long as the premium is paid on time.

Between $8,375 to $25,170, depending upon the choices made.

Burial insurance covers expenses involved in the arrangements of the insured’s funeral, like burial, service cost etc. Based on where you live, and what kind of funeral you, or your family have planned, the cost can range between $5,000 to $20,000. The death benefit of burial insurance goes federal income tax free to the beneficiary who can use the funds to of care of the expenses.

Final expense on the other hand is the gamut of expenses involved in the closing your life file. This can include estate taxes, medical expenses, or any other unforeseeable expenses that your beneficiary will have to face once you are gone.

Burial insurance and final expense insurance are usually interchangeable names of the same thing. 

These plans are simplified whole life policies. This basically means that the insurance company will look into your medical history but will not ask you to go through a medical exam. Usually, there can be a phone interview to verify your existence and to confirm the information you provided. It is also done to make sure that no one forced you into purchasing. 

The entire exercise takes place over the phone and the insurance company’s secure portal. The approval of your application can, therefore, take from a few minutes to a couple of days.

Of course, you can.

The fact that you could be responsible for the burial and othe final expenses makes you a person with ‘insurable interest’.

Husband, wife, domestic partner, children, grand-children, they all have insurable interest making sure that you have a life insurance, or a burial insurance policy.

This will save them from having to look for funds to give you a decent burial.

Unless the applicant’s health is bad or severe, this doesn’t happen. Under traditional life insurance scenario, you are hard to insure or uninsurable. The burial insurance policy in that case will give you a graded or modified coverage. 

Absolutely!

Most insurances companies allow that. In this case the child will be the owner of the policy and the parent will be the insured.

No.
By law the life insurance brokers cannot charge you even a penny over the company’s quoted premium. 
Therefore, no matter you go, your premium will always be the same.

In simple terms, collateral assignment in burial insurance means using the burial insurance policy as a guarantee for a loan or debt. When you have burial insurance, you can assign the policy to a lender to show that if you pass away and there’s still an outstanding loan, the lender will be paid from the insurance money before it goes to your family or beneficiaries. It’s a way to use your burial insurance as security for the loan you’re taking.

Some organizations and government agencies offer free burial insurance or assistance to people with low income who can’t afford burial expenses. For example, some states have programs through their Department of Social Services or Department of Aging, and nonprofit organizations like Catholic Charities or the Salvation Army may help too. Some funeral homes also have programs for low-income families.

Eligibility requirements for these programs vary, and there may be limited funds. If you need burial assistance or free burial insurance, research programs in your area and talk to a social worker for help in finding available resources.