Growth & Jobs | ‘Use life insurance to reduce burden of final expenses’

OTHNEIL BLAGROVE, senior manager of sales at JN Life Insurance, is urging more Jamaicans to consider life insurance as a means to offset the financial burden that’s typical with settling final expenses associated with the death of loved ones.

Blagrove explained that while death can be stressful, the attendant financial burden can be avoided if proper plans are put in place. He added that death estate planning is just as important as funeral expenses.

“Most people believe that planning for death is just the funeral. However, it’s more than that. Preparing for death also means putting the necessary financial plans, such as your estate, the right insurance plans, the type of funeral you want, where you want to be buried, or if you wish to be cremated,” he explained.

“All of these plans come with a cost, which should not leave your family in debt. In fact, in some parts of the world there is a phenomenon known as ‘funeral poverty’, which occurs when the price of a funeral is beyond a person’s ability to repay the costs. This means that the person may end up in debt because of the cost of the funeral. But, this phenomenon can be avoided. If you plan properly, you should be able to send your loved one off without wondering how you are going to do it,” the insurance executive outlined.

The JN Life senior manager pointed out that one of the first things to do is to ensure that a will is in place.

“You should not take it for granted that your assets will be distributed based on the oral promises you would have made during your lifetime,” Blagrove advised. “Although you may have outlined how the assets should be divided, there is no guarantee that disputes won’t arise based on how the assets are distributed by virtue of the Intestates Estates and Property Charges Act.”

“Also, you can’t say that if ‘I create a will, it means I will die sooner’. Or, that you don’t have enough assets. Estate planning should begin as soon as you start acquiring assets, even if it’s a small saving in the bank,” he added.

Importantly, Blagrove suggested that persons should invest in insurance, particularly a family indemnity plan, to offset the cost of burial.

“Family indemnity plans are affordable for [most] persons, regardless of their income and can be paid monthly, quarterly, semi-annually or annually,” Blagrove explained. “They cover the costs of funerals and, in the case of JN Life’s insurance plans, clients can also benefit from critical illness coverage. Family indemnity plans also allow coverage for up to six persons, including in-laws, and policyholders can receive from $400,000 up to $1.5 million, depending on their contributions,” he added.

As a more cost-effective alternative, Blagrove recommended cremation as another option for persons to consider when taking care of the remains of loved ones, given that burials typically cost in the region of $300,000 or more.

“Cremation can be less costly than burial; therefore, it should be given some thought while respecting the last request of your loved one,” he added. Blagrove emphasised that families should always do their research when deciding the best options to send off their loved ones.

“Some funeral directors offer packages where you pay for your funeral in advance. If you can afford this, this should be considered because you pay a set figure and the cost remains the same, even if the person dies years later,” he advised further.

“For those who are unable to do this, the family indemnity and other whole life plans becomes important. These plans pay out a certain amount to cover final expenses and based on the amount to be paid out, persons can decide how they will send off their loved ones. However, no matter what, like everything else, we advise families to stick to a budget because you don’t want the added burden of debt while you are grieving,” he stated.

editorial@gleanerjm.com