U.S. Burial Insurance Market Size, Share & Trends Analysis Report By Coverage Type (Level Death Benefit, Guaranteed Acceptance, Modified Or Graded Death Benefit), By Age Of End-user, By State, And Segment- Industry Analysis, Share, Growth, Regional Outlook and Forecasts, 2023-2032

The U.S. burial insurance market size was estimated at USD 68.61 billion in 2022 and is expected to surpass around USD 98.66 billion by 2032 and poised to grow at a compound annual growth rate (CAGR) of 3.7% during the forecast period 2023 to 2032.

Key Takeaways:

• In the coverage type segment, modified or graded death benefits had the biggest revenue share of around 47% in 2022. The rather swift increase, with a CAGR of 4.5% for the level death benefit coverage type, comes next
• In terms of end-user age, those over 60 and 70 account for the greatest revenue shares, accounting for about 31% and 32% of the market respectively in 2021. This group is anticipated to maintain its dominance during the forecast period. Moreover, individuals over 80 are expected to account for a pretty large increase over the course of the projection period, with a positive CAGR of 4.5%, as the population ages, which is anticipated to promote market growth
• One of the largest challenges confronting health insurance companies and other private payers in the U.S. is the increased demand for funeral services and their accompanying expenses. This has made it feasible for several government programs to be implemented, ensuring that everyone, regardless of circumstance, receives adequate end-of-life care. As more individuals understand these efforts and as insurance firms focus more on providing end-to-end plans to customers, the overall market is expected to expand
• Additional factors boosting the market expansion during the projected period include increased awareness about funeral insurance, expanding healthcare coverage, increased competition, and related collaboration to provide policy applicants a better coverage
• Key players also contribute to market growth by entering into partnerships, engaging in mergers and acquisitions, and launching new products. For instance, Nassau Financial Group, L.P. completed the acquisition of Foresters Life Insurance and Annuity Company in July 2020. By making this purchase, the company has upheld its promise to continue using the independent Foresters branch and leveraging goal-driven organizations to fuel the expansion of its insurance business in the U.S.

U.S. Burial Insurance Market Report Scope

The demand for funeral services and their associated expenses is expanding as a result of people's increasing awareness of the need to “make wise decisions today for peace of mind tomorrow”. This trend is primarily supported by the fact that prices for many products and services are rising quickly, and while funeral costs are rising as well, but are not doing so at a rate that is keeping up with inflation. Moreover, even though funeral costs are not rising at the same rate as inflation, they have increased significantly in recent years.

For instance, the 2021 National Funeral Directors Association (NFDA) Member General Price List Study found that while the median cost of a funeral climbed by 11.3 % to USD 6,970 over the previous five years, the cost of a funeral with cremation increased by just 6.6% to USD 7,848. For the same period, the total inflation rate was 13.98 %.

Furthermore, the market for burial insurance as a whole is benefiting from the growth of the health insurance sector, including the increase in digitalization and internet use.

Surviving loved ones frequently feel financial hardships during a period of intense grief since they have no way to cover these costs. This, combined with the COVID-19 pandemic, has drawn the attention of governments, and thus, from April 2021, FEMA begin to reimburse funeral costs up to USD 9,000, or about the average cost of a funeral. This will raise public awareness of funeral costs and spur increased government action, which will bring viewers to health insurers and boost the market during the forecast period.

In addition, noteworthy government initiatives and related acts have been put in place, such as the Affordable Care Act, to ensure that everyone receives acceptable comprehensive coverage regardless of their circumstances.

Additionally, according to a press release from the White House, US President Joe Biden stated on April 5, 2022, that his administration plans to expand the Affordable Care Act (ACA) to improve access to coverage and reduce costs, potentially raising the percentage of Americans who are insured. As a result, more Americans may decide to have their health insurance cover funeral costs, resulting in rising demand for burial insurance during the forecast period.

Age of End-user Insights

Based on the age of the end-user, the market is segmented into four types - over 50, over 60, over 70, and over 80. One of the main determinants of how much a policy would cost is age. Senior policyholders in particular start looking for plans that tend to cover all parts of expenses, including burial fees, because funeral prices are often greater in the U.S. and can burden families when loved ones pass away. Therefore, incorporating a payment for funeral costs in insurance plans benefits both the individual policyholder and their family substantially.

The U.S. Census Bureau's International Database for Population by Age for the U.S. revealed that individuals between the ages of 60 and 69 are significantly more common than individuals in other older age categories. This shows that people in that age group may be more inclined to choose these sorts of policies since the U.S. is one of the more developed and health-conscious nations, where people are typically aware of their health status and the benefits of health insurance. As a result, the segment of people aged over 60 and over 70 is dominating the market and is expected to maintain its dominance throughout the forecast period. 

Coverage Type Insights

Most last expenditure life insurance plans don't need a medical check, regardless of age. Based on coverage type, the market is segmented into three types - level death benefit, guaranteed acceptance, and modified or graded death benefit.

A level death benefit option in an insurance policy guarantees coverage that immediately pays out the whole death benefit. Whether the insured individual dies in the first or last years of the policy's term, doesn't matter. Additionally, this is the only form of final cost insurance that offers the insured full and immediate pay. Consumer adoption of level-depth benefit plans, which would expand quickly owing to the similarly low rates, would be the segment's primary growth driver.

The modified or graded death benefit segment held the largest revenue share of over 47.6% in 2022. Modified or graded death benefits have disadvantages as do other insurance plans, but they are still an option for people with a variety of health problems because the insurance industry is exposed to substantial risk by excluding any medical examination and associated tests. It is also anticipated that this segment will grow throughout the projection period, driven by a rise in the number of people who have serious illnesses preferring to buy such plans that also cover funeral costs.

State Insights

Because several insurance companies provide integrated health, life, and death insurance, in 2021, California, New York, and Texas owned the largest shares of the entire United States. Additionally, the Affordable Care Act in the US mandates the need for comprehensive coverage, which will act as one of the major drivers for the US industry and assist the market's growth throughout the course of the forecast period. As a result of the market's development, more providers are attempting to break into it by broadening its geographic reach and offering policies to a larger population. One such current market strategy is expanding the Online Sales Strategy.

Some of the prominent players in the U.S. Burial Insurance Market include:

• Aetna Inc.
• Mutual of Omaha
• Transamerica
• Royal Neighbors of America
• Prosperity Life Group
• American International Group, Inc.
• Allianz Life
• Gerber Life Insurance
• Baltimore Life
• Foresters Life Insurance and Annuity Company (acquired by Nassau Financial Group, L.P. also known as ‘Nassau’)
• AARP/New York Life
• Globe Life Inc. (Globe Life and Accident Insurance Company)
• Colonial Penn

Segments Covered in the Report

This report forecasts revenue growth at country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2018 to 2032. For this study, Nova one advisor, Inc. has segmented the U.S. Burial Insurance market.

By Coverage Type 

• Level Death Benefit
• Guaranteed Acceptance
• Modified or Graded Death Benefit

By Age of End-user 

• Over 50
• Over 60
• Over 70
• Over 80

By State 

• California
• Texas
• Florida
• New York
• Pennsylvania
• Illinois
• Ohio
• Georgia
• Rest of the U.S