How Long Does Funeral Insurance Take to Pay Out?

Funeral insurance does not have one payout time. Some insurers say they pay most claims within about a day once the claim is complete, but state law only sets outer limits. Texas, for example, requires payment within two months after the insurer has proof of death and has verified the beneficiary. A death in the first two years of a policy can also trigger a review, so plan to cover the funeral bill another way if the home wants payment sooner.

How fast does funeral insurance pay?

The honest answer is that it varies. NerdWallet's review of burial insurance reports that Mutual of Omaha pays most claims within 24 hours. That is one insurer's claim, and it describes a straightforward claim with the paperwork in order. Another company, or a claim with complications, can take much longer.

What the law guarantees is less generous:

Every state has its own rules. Your state department of insurance can tell you what applies to a policy issued there.

What happens between the death and the payment?

1. The death is reported and the death certificate is filed. The funeral home usually handles the filing and often orders the first certified copies. See how to get a death certificate.
2. You contact the insurer and ask for claim forms. You can do this before you have the certificate. Each beneficiary completes their own form, according to Washington's regulator.
3. You send the claim form and a certified death certificate. Our guide to funeral insurance claim documents lists the paperwork.
4. The insurer checks the policy and the beneficiary. How long this takes depends on the insurer and on whether the policy is new.
5. The benefit is paid, by check or electronic transfer, or sent to the funeral home if you used an assignment.

What can slow a funeral insurance payout?

• A death in the first two years. The Texas Department of Insurance says life insurance policies have a two-year contestable period, and the company may review the information on your application. Washington's regulator says it will investigate omitted information on claims in that window. This review can add time.
• A waiting period. On some policies, the full benefit is not payable in the early years, which changes how much is paid, not only when. See the funeral insurance waiting period.
• Missing or incomplete paperwork. An unsigned form, a missing certificate or a mismatch between names can send the claim back.
• A lapsed policy. Texas says most policies have a 31-day grace period after a missed premium. If the policy lapsed beyond that, there may be nothing to pay.
• Beneficiary problems. If the named person has died, cannot be found or is a minor, the money may need to go through the estate or a court. See beneficiary update checklist.
• Unusual circumstances of the death. A death that is still under investigation can hold up the death certificate and therefore the claim.

Ask the insurer about its own process, including whether you can file online and how long it says it needs.

How do you pay the funeral home while you wait?

The Funeral Consumers Alliance says most funeral homes today expect payment in full up front. That leaves a gap if the insurance has not paid. Options include:

• Ask about an assignment of benefits. You sign over part of the benefit, and the insurer pays the funeral home directly. Some homes accept these and some do not. See assignment of benefits for funerals.
• Use pre-need insurance, if that is what you have. Washington's regulator says pre-need policies pay the funeral provider directly.
• Bridge with a card, savings or help from family, then repay yourself when the claim pays.
• Ask about a payment plan. The FCA says some homes negotiate installment plans.
• Choose a lower-cost service. Direct cremation and direct burial cost far less than a full service.

Our guide to paying for a funeral upfront covers these in more detail. Get any arrangement with the funeral home in writing before you sign.

What if the claim is delayed or denied?

Call the claims department, ask what is outstanding and keep notes of each call. If the insurer denies the claim, ask for the reason in writing, read the policy and check the dates. You can complain to your state department of insurance. See what to do if a funeral insurance claim is denied and the general guide to claiming life insurance.

What to do next

1. Find the policy and the insurer's claims number, and report the death.
2. Ask the funeral home to order several certified death certificates.
3. Send the form and certificate, and ask for an expected payment date in writing.
4. Decide how you will pay the funeral home if the benefit will not arrive in time.