The Hartford Financial Services Group recently released a survey that indicated two out of three Americans would have a hard time paying for an unexpected funeral, and 46% of them would anticipate using life insurance to pay for funeral expenses.
Those folks will have for a rude awakening when they realize most life insurance claims take weeks or months to process – unless they have life insurance from The Hartford, which recently announced its Life Conversations Express Pay program that speeds up payment of death benefits to as little as 48 hours from the date of death.
“We noticed there was a gap between employees believing they would get the life insurance proceeds in time to be able to pay for the actual funeral expenses. The reality is, in most instances, the beneficiaries don’t get the benefit payment before they have to pay for a funeral,” said Brad Molinsky, Director of Products in The Hartford’s Group Benefits Division. “Our challenge was to figure out how to get life insurance proceeds to the employees faster. That’s how the Express Pay concept came to be.”
About a year and a half ago, The Hartford looked to put together a suite of services that employees or their beneficiaries could access for help with end-of-life planning, or executing those plans when a person dies. They partnered with Everest Funeral Planning and Concierge Services to provide a comprehensive end-of-life planning tool kit that they call Life Conversations.
This suite of services is an automatic part of group life insurance program enrollment with The Hartford and does not cost extra. The Hartford’s Life Conversation resources include funeral planning, will preparation, estate planning, and emotional, financial and legal support services to beneficiaries. The call center, staffed by Everest employees, is open 24 hours a day, seven days a week.
Said Molinsky, “Hopefully, beneficiaries have pre-planned, but if they haven’t, at least they can get to Everest as soon as possible, because Everest can help them navigate the funeral decisions.”
Everest works with the funeral director to get a form they call the Funeral Director’s Death Certificate, a document that The Hartford accepts in lieu of waiting for the formal death certificate to be processed by the county or state, which can take weeks.
The Express Pay feature applies for expected death, such as in a hospital or nursing home after an illness. With an unexpected death – such as an auto accident – the company would follow the traditional method of a claims decision. It takes time to get results from a coroner’s investigation or an autopsy, and the beneficiaries may have to wait weeks before a death certificate is issued.
In the Express Pay process, the claims department expedites review, makes the claim decision, then overnights the benefit to the beneficiary. There are two payment options – a lump sum check or an alternative feature called the Safe Haven program, a unique feature for group life insurance carriers. The Hartford sends a checkbook, called a draft book, that allows the beneficiary to draw immediately-available funds to write a check to the funeral home. The lump sum check needs to be deposited and may take 7-10 days to clear.
“The reality is, probably not everybody’s going to use it, but at least we want to make it available to anybody covered under our life insurance programs, and build awareness with the employers to promote to their employees that this is a valuable benefit,” said Molinsky.
- Most people estimate the average cost of a funeral is $8,800. That is close, but when you add the cost of a cemetery plot and grave opening and closing, the range is closer to $10,000 to $12,000.
- Nearly half of those surveyed (46%) said they anticipate using life insurance to pay for an unexpected funeral, and 42% said they would use personal savings.
- 53% of consumers have obtained life insurance
- 36% have not started end-of-life planning
- 27% have prepared a will
- 20% have created a living will
- 5% have made funeral plans/arrangements
With only 5% of respondents saying they’ve made funeral plans, it just goes to show, most folks really don’t plan to die. As I’m fond of saying, just as talking about sex won’t make you pregnant, talking about funerals won’t make you dead – and the people you love will benefit from the conversation!
Find out more through The Hartford Financial Services Group.