Does funeral insurance pay the funeral director directly in NZ?

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.

No. Momentum Life's Funeral Insurance pays the policy owner or the named beneficiary, not a funeral director, and its wording says it cannot pay a company directly. Valid claims are usually paid within 24 to 48 hours of approval. The family then settles the director's invoice from that cash, so the invoice may be due before it arrives.

Get a quote and apply online today

See your price in about a minute, then apply online with Momentum Life. Guaranteed acceptance, no health questions, no medical exams.

Funeral cover See your price Ages 40–75 · $3k–$30k Life cover See your price Ages 18–65 · $50k–$300k

Want more cover or have questions? Talk to an adviser

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.

How the money moves

The benefit is a cash sum paid to a natural person. Momentum's Funeral Insurance wording says it makes benefit payments "to you as the Policy Owner, or in the case of your death to the Beneficiary/ies you have nominated", and that if no beneficiary is named, payments go to the Policy Owner or to the executor of the owner's estate. A beneficiary can be anyone you choose "so long as they are a 'natural person'", because Momentum cannot pay a benefit directly to a company, charity or other organisation (Momentum Life: Funeral Insurance Policy Wording). A funeral director is a company, so it cannot be named. We found nothing in the wording that lets the benefit be assigned to a director. If you want that, ask Momentum before you rely on it.

Who receives the payout

Situation	Who is paid, under the wording
You own a policy on yourself and you die	The beneficiaries you named; if none, the policy owner's executor
An adult child owns a policy on a parent, and the parent dies	The policy owner, who is the child
You nominated two beneficiaries and one has died before you	The share goes proportionally to the remaining beneficiaries unless you update the nomination

The details of ownership and nomination are in funeral insurance beneficiaries. Where a child owns the policy on a parent, the cash goes to the child as owner, not to the parent's estate. The parts of the wording we read do not say what happens if the owner dies before the person insured, so ask Momentum if that matters in your family.

A timeline, and the gap in it

The only timing Momentum states is for payment, and it starts at approval.

Step	What the sources say
Death and funeral arrangements	A funeral director can organise the medical certificate and register the death (govt.nz: What to do when someone dies).
Claim made	The owner, a beneficiary or the executor contacts Momentum and downloads or requests a claim form. Phone 0800 108 108, Monday to Friday 9am to 5pm, or [email protected] (Momentum Life: Claims).
Proof supplied	The claimant supplies proof "to our satisfaction", at their own expense, which "may include" a death certificate or a confirmed diagnosis of death.
Approval	No time is stated. Momentum says "all valid claims will be paid without unnecessary delay".
Payment	"Usually within 24 - 48 hours of approval", in New Zealand dollars.

Two cautions follow from that. The 24 to 48 hours is not counted from the death or from lodging the claim, so we cannot give a total. And Momentum will not pay unless all premiums due have been paid and the policy was not cancelled when the claim event occurred. An official death certificate costs $35 and usually takes 1 to 2 weeks (govt.nz: Get a death certificate), so ask Momentum which proof it will accept first. For the same sequence step by step, see how to claim funeral insurance and the payout timeline.

Covering the invoice in the meantime

Whether a director will wait for an insurance payout is the director's decision, so ask at the first meeting what payment terms they offer. Other sources that may be open:

The deceased's bank account. Govt.nz says banks can release money from the deceased's account to pay for the funeral, without the person being executor or waiting for probate (govt.nz).
The Work and Income Funeral Grant, up to $2,697.43, with tests that depend on your relationship to the person who died. Prepaid funeral cover can stop you getting it (Work and Income: Funeral Grant).
The ACC funeral grant, up to $8,236.40 where the death results from a covered injury. ACC says it is paid to the director or reimbursed (ACC: Financial support after a death).
Savings or a prepaid plan, if the person had one.

Only members of the Funeral Directors Association are obliged by its code to be transparent about costs, so ask any director for an itemised written estimate (FDANZ, 2026 Industry Trends Report). Our guide to paying for a funeral sets the options out in order.

What if the benefit is smaller than the bill?

The family pays the difference. FDANZ puts a full cremation funeral for 50 guests at an average of $11,700, so a $5,000 benefit would leave a gap that the other sources above would need to fill. Momentum's wording says the benefit "may not cover the cost" of a funeral, and that total premiums could exceed the benefit. In the first 24 months only accidental death within 90 days of the accident pays; otherwise premiums for that person are refunded and no benefit is paid.

Who this suits

The set-up suits a family with someone who can wait a few days, or who has a second source of money, and who wants a lump sum without going to the bank first. It suits less well a family with no spare cash who expect the director to be paid before any insurer pays. See the funeral costs section for what a director's bill is made of.

Getting advice

The buttons on this page open Momentum Life's online application for Funeral Insurance, for ages 40 to 75. Momentum Life holds an A.M. Best rating of B (Fair), in the range Momentum calls "Vulnerable"; see its financial strength page. QuoteHub is a Momentum Life partner and Smiths Insurance & KiwiSaver may receive a commission if you buy a Momentum policy; see how we are paid. Advice is provided by Craig Smith Business Services Limited, trading as Smiths Insurance & KiwiSaver, a licensed Financial Advice Provider (FSP712931). If someone has just died, our guide when someone dies lists the first steps, and the funeral insurance hub covers the product.