What is pre-need insurance?

Pre-need insurance — sometimes called burial insurance, funeral insurance, or a pre-need funeral contract — is a type of permanent life insurance used to pay for funeral services and burial or cremation.

Pre-need and final expense life insurance both cover your final expenses. However, with pre-need insurance, your funeral home becomes your policy’s beneficiary. It gets your death benefit and will use the funds solely for your funeral and burial expenses.