Life insurance or a funeral plan - which one is best for you?

Get to know the differences between a funeral plan and a life insurance policy and compare what they both cover.

When researching later-life financial planning options, you may be considering funeral plans or life insurance. Both options allow you the peace of mind that your family will be supported financially but in different ways.

Funeral plans let you choose and pay for your funeral in advance so your loved ones don't have to cover the costs or arrange the logistics. Life insurance, on the other hand, is a way to ensure your family will receive a lump sum of money should you die during the period you've chosen to be covered for.

Learn more about how a funeral plan or a life insurance policy differs to help you weigh up each option.

What is a funeral plan?

You'll need to know how funeral plans work to determine whether or not getting one is suitable for you.

The process of taking out a funeral plan will follow these steps.

  1. You choose the type of funeral you'd like.
    When you're researching funeral plans you will naturally start thinking about what you want.
  2. You select a funeral plan provider.
    Choose between extravagant or simple plans.
  3. You select your payment option.
    By paying in monthly instalments you can afford a funeral that may otherwise be out of your budget.
  4. You share your wishes with your loved ones.
    Having a funeral plan leaves no doubt about the type of funeral arrangements you want.
  5. You have peace of mind that your funeral is covered.
    As long as the payment conditions of your plan are met, your funeral is guaranteed to go ahead.

Flowers On Wooden Coffin

Get in touch

At Distinct Cremations we offer cremation only funeral plans and plans for modestly attended funerals.

We're happy to answer any questions you may have about our plans over the phone, or you can request a free guide for details about what we offer. If you've decided a funeral plan is right for you, you can also view our products and take out a plan online.

Have a chat with us


Want to talk through our options? If you have questions or would like some in-person support we’re just a call away.

Call us on 01543 212997

Get a free guide

Sue bench

Need some time to digest the details? You can download a PDF of our guide online or get a printed copy posted out.

Get our guide

Set up a plan online

Woman Buying Funeral Plan On Computer

If you’re happy that one of our plans is exactly what you’re looking for, you can get everything set up yourself online.

View our funeral plans

What is life insurance?

When you take out a life insurance policy, you pay for it monthly for a set period of time. Should you die within this time period, your spouse, children or the person you would like to benefit will receive a lump sum payout.

You can choose the amount of time you would like to be covered for as well as how big you would like your payout to be. Both of these choices will affect how much you pay.

Depending on which type of life insurance you choose, your payout amount could increase, decrease or stay the same over time.

Increasing cover

direct cremation plan large

If you’re getting life insurance to cover your family's living costs, the cost of living is likely to rise over time.

There are policies available where the payout increases to account for inflation, but it's worth noting that the monthly payments will also rise.

Decreasing cover

private cremation plan small

If you’re covering yourself against an expense or debt that will decrease over time, for example your mortgage, you can get decreasing cover.

As you owe less money on your mortgage, your family will receive a smaller payout amount to pay it off.

Level cover

attended funeral plan small

If you’re happy for your loved ones to receive a set payout that doesn't change, life insurance with a fixed payout is available too.

Monthly payments for this type of cover will also be fixed so they don't change for the duration of your policy.

Your age will affect the price you pay for life insurance cover. The older you are, the more expensive it is.

You will also be asked medical questions to determine whether life insurance can be offered to you. These can affect how much your monthly payments will be as well.

What is life assurance?

Whilst looking into life insurance policies, you may also come across other products like over 50 life cover or life assurance.

Whereas life insurance is cover for a fixed amount of time, life assurance covers you for the whole of your life.

  • With life assurance, a payout is guaranteed when you die, so monthly payments are likely to be higher.
  • Payments will also be ongoing throughout your life.
  • The amount you have to pay could go up and you will need to accept these price rises to continue your cover and keep your payout.
  • You can increase the size of the payout you'd like to receive but not decrease it.
  • Your age when you take out the policy also affects how much you pay.


The terms life insurance and life assurance can sometimes be used interchangeably, so always check the specific policy you're taking out for details of your cover period and payment terms.

Can you have both types of cover at the same time?

Funeral plans and life insurance are designed for different purposes and it is completely possible to take out both at once.

Just make sure that if you're paying for both monthly you can keep up with the payments. Your funeral plan may be cancelled or your life insurance cover may end if too many payments are missed.

Taking out both a funeral plan and a life insurance policy means:

  • You don't have to worry about your family covering the costs of your funeral.
  • You can alleviate the stress your loved ones may feel about making funeral choices on your behalf.
  • You are protected from the rising costs of funerals which have more than doubled since 2004.+
  • You can ensure your spouse or children also receive a lump sum payout that they can use for expenses other than your funeral.

+ Funeral costs were £1,835 in 2004 and £4,141 in 2023 (SunLife Cost of Dying Report 2024,

Laptop For Researching Funeral Plans On Table

How do funeral plans compare to life insurance?

Funeral plan Life insurance
What is the cover commonly used for? To pay for a funeral that suits your wishes To pay off a mortgage or financially support your children or spouse
What happens when you die? Your funeral goes ahead as agreed as long as all qualifying payments have been made A payout is made if the person covered dies during the timeframe their policy covers them for
Who receives money? Your chosen funeral provider after they've carried out your funeral to cover the costs The person of your choice
How do you pay? Either upfront or in monthly instalments for a set time In monthly instalments for the duration of your policy
Are there age restrictions? Plans are available for adults of all ages There may be upper age limits around 75-85
Are there medical checks? No – eligible regardless of health Yes - there will be medical and lifestyle questions

For both life insurance and funeral plans you will need to decide what happens after your death.

  • Choose your next of kin or the person you trust to either receive the money from your life insurance or instruct your funeral provider to make your funeral arrangements.
  • Communicate your plans with them to make sure your life insurance is claimed or your funeral plan is used.

Our funeral plans

We offer plans for simple, no fuss cremation funerals.

Choose between our Unattended Direct Cremation Plan, Small Attended Cremation Plans or full length celebrant-led Simple Funeral Plan.

Alternatively you can view our price list or our CMA standardised price list.

Unattended Direct Cremation Plan

From £1,699 or £18.79* per month

Our Unattended Direct Cremation Plan is a great choice for those looking for a simple, low-cost unattended cremation without a funeral ceremony.

With our Unattended Direct Cremation Plan, the cremation takes place with no service or mourners present at our high-quality crematoria where dignified care is guaranteed.

View our Unattended Direct Cremation Plan * Price advertised is for a 50 year old paying over a 10 year period. Total cost is £2,349.80 and includes administration fees.

Small Attended Cremation Plans

From £2,099 or £24.58** per month

Our Small Attended Cremation Plans offer a private funeral where the number of people attending is limited to a small gathering of friends and family.

With our Small Attended Cremation Plans, you can have up to 8 people attending a 10 minute service or up to 20 people attending a 20 minute service.

View our Small Attended Cremation Plans ** Price advertised is for a 50 year old paying over a 10 year period. Total cost is £3,044.60 and includes administration fees.

The option to have a completely unattended funeral means you can save money and your family can celebrate your life in their own unique way instead.

Which option is better value for money?

Funeral plans and life insurance meet very different later-life financial planning needs. Whether or not either option is worth your money depends on what you want to happen when you die.

Do you want to pay for your own funeral or get a payout to support your family?

The amount you pay for your funeral plan or life insurance varies widely depending on what you choose. Factors like your age can also affect the amount you pay.

Hands Holding Documents To Review

Funeral plans

Funeral plans could be a good option for you if you worry about how your family will cover the costs of your funeral.

Even if the money for your funeral could be taken from your savings, property or other assets, some of your money could be lost to inheritance tax and it can take time for funds to be released. Funeral providers often need a payment or deposit upfront to start arrangements so your family could have to cover the costs initially.

Factors that affect the amount you pay are:

  • How extravagant you'd like your funeral to be
  • Whether you pay for your funeral plan upfront or monthly
  • Your age if you're paying monthly

Woman Using Phone And Laptop

Life insurance

Life insurance could be a good option for you if you worry about how your loved ones would cope financially if you die.

You may have children who are at school or university and are financially dependent on you. Or it's possible you have a spouse who relies on you to pay the mortgage. You may just want to gift your loved ones money in the event of your death. A life insurance policy means that if you die whilst covered you can still support your loved ones.

Factors that affect the amount you pay are:

  • The payout amount you'd like
  • The duration of your insurance cover
  • Your age and your health

Are funeral plans and life insurance regulated?

Providers of both funeral plans and life insurance products are subject to regulation to help protect consumers' money.

Distinct Funeral Plans Limited (DFPL) is authorised and regulated by the Financial Conduct Authority (FCA) to sell and administer funeral plans. As part of our regulatory responsibilities, we provide full and clear information about how we keep our funeral plans safe.

Companies that sell life insurance products are authorised by the Prudential Regulation Authority (PRA) and regulated by the FCA and PRA. They are also subject to the same regulatory standards, designed to enhance consumer protection and to protect the integrity of UK financial services markets.

How we keep your money safe

Other useful resources

To help you continue your research into the financial products available to you and plan for later life, you may find these other resources helpful.

How to choose a funeral plan

A couple funeral planning

Decided that a funeral plan is right for you? Find out how to choose a plan that takes your funeral wishes and preferences into account.

Choose a funeral plan

How to prepare for your own death

Family Walking On The Beach

As well as planning financially, there are some other important ways you can prepare yourself and your family for your death in the future.

Prepare for your death

Arrange a funeral from just £1,099

Sue Cook Standing

If you need to arrange a funeral for someone else, whether now or in the future, we can provide a compassionate cremation funeral.

Arrange a funeral

We offer the highest level of support, but don't take our word for it

Below are a selection of reviews from those who have arranged a funeral or purchased a funeral plan through Distinct Cremations.

"Smooth and straightforward purchase with plenty of contact and feedback."

“Easy to use and very helpful. Very easy to use their services and always called with updates. Sorry to say I've had to use their services twice now and I've already booked my own service. On both times I've used this service I've been kept informed by calls to everything going on. All my requests were made to feel like no trouble whatsoever, happy to help attitude made what was a very emotional time pass with no problems. Ty to all the teams involved"

"Quick and easy to arrange. Very good value. The information pack arrived days after I made my enquiry. It was so easy to arrange the plan that I wanted. The follow up call was very reassuring. I am very happy with the service provided."

"Already recommended to other family members. Easy to access and apply for a plan at a good price, and even better, in 20 years time there will be no additional cost. It's not a subject that anyone wants to think about but now I have it sorted it has given me peace of mind knowing my family won't have the worry or cost when that time comes, now I can forget it and enjoy many more years, highly recommended. Hassle free application that was completed in minutes but I'm not planning on using this plan anytime soon!!"

"I was very pleased with the prompt efficient service that I got, everything was explained to me, and the paperwork was easy to understand, and there was no pressure put on me for a decision. I would most certainly recommended this company for price and efficiency."

“Happy with everything. We were well pleased with the consultant Sarah Mills she was very helpful and made us feel very confident that we were doing the right thing about our funeral plan."

"Positive without being pushy. Easy to understand the scheme, helpful brochure and a realistic price. The staff I contacted were polite and professional. Great value. An ideal alternative for those of us who don't want a lot of fuss."

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