Burial insurance in New Zealand: what the term means

Written by Henry Smith · Reviewed by Smiths Insurance & KiwiSaver, licensed Financial Advice Provider (FSP712931) · Updated 2026-10-20 · Reviewed quarterly, when the underlying data is restated.

Financial advice is provided by Craig Smith Business Services Limited, trading as Smiths Insurance & KiwiSaver, a licensed Financial Advice Provider (FSP712931). QuoteHub is a trading name.

Burial insurance is not a separate product in New Zealand. It is a United States name for what New Zealand insurers call funeral insurance: a small policy that pays a lump sum towards funeral costs, whether the family chooses burial or cremation. Momentum Life's Funeral Insurance accepts New Zealanders aged 40 to 75 and pays a benefit of $3,000 to $30,000.

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Funeral cover: Only accidental death is covered for the first 2 years. Total premiums can add up to more than the cover, and it may not meet the whole cost of a funeral.

Life cover: Conditions you already have aren't covered for the first 2 years (premiums refunded instead). Suicide isn't covered for the first 2 years, and a few conditions can be excluded permanently.

Insurer: Momentum Life Limited. Financial strength rating B (Fair) from AM Best, affirmed 11 February 2026; B ratings sit in AM Best's 'vulnerable' range. The rating scale is available for inspection at every Momentum Life office in New Zealand. What this means

Already have cover? Keep it. New cover won't pay for a condition you already have in its first 2 years.

Opens Momentum Life's online application; its guidance only covers eligibility. QuoteHub is a Momentum Life partner. Smiths Insurance & KiwiSaver may receive a commission if you buy. General information, not advice.

Funeral insurance, which some people search for as burial insurance, is a policy you pay for with regular premiums and that pays a fixed sum after you die. The money goes to the policy owner or the beneficiary you name, not to the cemetery or the funeral director, so the family decides how to spend it. With Momentum Life no health questions are asked, but the first 24 months pay only for an accidental death; for any other death in that time no benefit is paid and the premiums are refunded. Total premiums can also end up larger than the benefit, and the benefit may not cover the whole funeral. Other insurers set different ages, limits and early windows, so the name on the product tells you very little.

Why people search for burial insurance

The phrase comes from the American market, where "burial insurance" and "final expense insurance" are common labels for small whole-of-life policies. The products that fit it here are the funeral policies covered in our funeral insurance hub, and the closest overseas equivalent is explained on our final expense insurance page.

Two things are worth knowing about the word "burial":

A funeral policy does not need to be spent on a burial. The benefit is a lump sum. In 2025 about 69% of New Zealand funerals ended in cremation and 25% in burial, according to the Funeral Directors Association of New Zealand (FDANZ) 2026 industry report.
Burial costs more. FDANZ's scenario of a full funeral for 50 people averages $11,700 for a cremation and $14,300 for a burial. Council burial charges alone averaged $4,865 on FDANZ's 15-council sample, from $1,455 in Taupō to $7,207 in New Plymouth.

Burial insurance or funeral insurance: is there a difference?

For a New Zealand buyer, no. The real differences sit between insurers, not between the two names. Here is how the main options differ, as at 20 October 2026, from each provider's own pages.

	Entry age	Benefit	Early window	Premiums refunded on other death in window
Momentum Life	40 to 75	$3,000 to $30,000	24 months	Yes, all
NZ Seniors and OneChoice (Pinnacle Life)	18 to 79	$3,000 to $30,000	12 months	No
AA Life (Asteron Life)	50 to 79	$5,000 to $30,000	24 months	Yes, 100%
Chubb Life	50 to 80	Up to $30,000	24 months	Yes, 100%
Greenwich Life (Autosure)	30 to 70	$5,000 to $20,000	24 months	Yes, 100%

Our best funeral insurance page sets these out on more criteria, and there is no single winner on all of them.

How much cover can you buy without medical questions?

With Momentum Life you choose a benefit from $3,000 to $30,000. Acceptance is guaranteed, which means there are no health questions, medicals or paperwork. The cap is $30,000 per person across all Momentum funeral policies. If the death is accidental, the benefit triples, so $10,000 of cover pays $30,000 where the death happens within 90 days of the accident (Momentum Life: Funeral Insurance Policy Wording).

The 24-month limit, explained

For the first 24 months after cover starts, Momentum's policy pays only if the death is the direct result of an accident and happens within 90 days of it. After 24 months it pays for death from any cause. If the person dies of illness in the first 24 months, there is no benefit, and all premiums paid for that person are refunded. Increasing the benefit, or adding a person to the policy, starts a new 24-month window for that increase or person. This window is a limit on the cover, not a bonus. If you are buying for yourself in good health, it is the main cost of having no health questions.

Total premiums against the final payout

The policy wording itself says the total premiums you pay could exceed the benefit, depending on how long you keep the cover, and that the benefit may not cover the cost of the funeral. Momentum's premium rate for each person stays the same each year until their 89th birthday, after which payments stop and cover continues for life. The rate can still change for everyone on the same offer, with 30 days' written notice, if tax law changes or claims experience is significantly different from expected. A person who pays for 30 years and lives to 89 may pay more in premiums than the policy ever returns. A person who dies after the first 24 months may leave far more than they paid in. Nobody can know which, and this is why the product is a trade rather than a saving. Our break-even calculator lets you test the maths with a premium you have been quoted.

Burial insurance or a prepaid funeral

A prepaid funeral plan puts money aside now for a funeral later. It is a different tool from insurance, and the differences matter.

	Funeral insurance	Prepaid funeral plan	Savings
What you pay	Regular premiums	A lump sum or instalments into a trust	Whatever you set aside
If you die early	Momentum pays only for an accident in the first 24 months	The money is held for your funeral under the plan's terms	The balance is in your estate
Return on the money	None; total premiums may exceed the benefit	Now For Them says it is "not a savings or investment product, and no interest or return is paid"	Whatever the account pays
If your needs change	After the 30-day free look, cancelling returns no premiums (30 days' notice)	Check the plan's terms; Consumer NZ says trust money may not be withdrawable	You keep control

Sources: Now For Them (FDANZ), Public Trust Prepaid Funeral Trust, Work and Income: Funeral Grant and Work and Income: Residential Care Subsidy. Consumer NZ warns that money in a trust may not be withdrawable unless you are in significant financial hardship (Consumer NZ). Up to $10,000 of prepaid funeral expenses in a recognised funeral plan is not counted in the residential care subsidy asset test, and a prepaid funeral account counts as an asset when Work and Income assesses a Funeral Grant. Our page on funeral insurance versus a prepaid funeral goes through the choice in detail.

The Funeral Grant page says "prepaid funeral cover" can stop you getting the grant, and it lists life insurance proceeds among cash assets, so ask Work and Income how a funeral insurance benefit would be treated before you rely on either.

Who is eligible for guaranteed-acceptance funeral cover?

Momentum's wording says a "New Zealander" must live in New Zealand at application and be an NZ or Australian citizen, a permanent resident visa holder, or have been in New Zealand continuously for at least 12 months on a valid temporary work visa. The policy owner must be a natural person. An adult child can own a policy on a parent, because the wording counts a parent as a relative of the owner. Up to four people can be on a family policy. New applicants over 75 are not accepted by Momentum; the age limits at other insurers are in our funeral insurance age limits guide.

Who it suits and who it does not

Guaranteed-acceptance funeral cover may suit someone aged 40 to 75 who cannot easily get other cover, has no savings earmarked for a funeral and is comfortable with the early window. It suits people less if they have the money to set aside, can answer health questions for cheaper underwritten life cover through a licensed adviser, or expect the benefit to be needed within two years.

Applying with Momentum Life

The buttons on this page open Momentum Life's online application. Momentum Life Limited is rated B (Fair) by A.M. Best, a rating that Momentum's own table groups in its "Vulnerable" range; read its financial strength page before you decide. QuoteHub is a Momentum Life partner and Smiths Insurance & KiwiSaver may receive a commission if you buy a Momentum policy. Advice is provided by Craig Smith Business Services Limited, trading as Smiths Insurance & KiwiSaver, a licensed Financial Advice Provider (FSP712931). More detail on the plan is on the Momentum Life Funeral Cover page, and the wider picture on the funeral costs hub.