Working out how much funeral cover you need

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.

The funeral cover you need is the expected cost of the funeral you want, minus money that will really be available to pay for it, kept within what you can afford to pay in premiums. In New Zealand the Funeral Directors Association (FDANZ) puts an average full funeral for 50 guests at $11,700 for a cremation and $14,300 for a burial, and an unattended cremation at $4,700. Momentum Life's Funeral Insurance offers a fixed benefit of $3,000 to $30,000 towards costs, not a promise that every cost is met.

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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.

The four-step method

This is a way of working through the question, not advice about what to buy. The numbers below come from named sources and are dated; your own sums will differ.

Pick the funeral. A direct or unattended cremation, a service with a cremation, or a burial with a service are three different price points.
Price it. Use a sourced range, not a guess, and add the extras you actually want.
Subtract what will really be there. Count only money your family could reach in the first week or two.
Test the premium. A benefit you cannot afford to keep paying for helps nobody.

Step 1 and 2: what does the funeral cost?

FDANZ surveyed its member funeral homes in 2025 and reported these averages and ranges in its April 2026 report (FDANZ, 2026 New Zealand Funeral Industry Trends Report):

Funeral type	FDANZ average	Range reported
Unattended cremation (no service)	$4,700	Not published
Full funeral, cremation, 50 guests at a funeral home, celebrant, mid-price casket	$11,700	$10,000 to $13,900
Same scenario with a burial	$14,300	$12,800 to $17,000

FDANZ notes that directors are reluctant to quote an average, so these are typical prices against a defined scenario rather than a price list. Each funeral director sets its own prices, and only FDANZ members are bound by its code to be open about costs.

Which costs are fixed and which vary

Most of the bill is a choice you or your family make. FDANZ's indicative component ranges (as at July 2025, and they vary by funeral director) show where the room is (FDANZ: Financial matters):

Item	Indicative range
Professional services fee	$3,000 to $6,500
Casket	$1,200 to $5,000
Cremation fee (council or private)	$600 to $1,100
Burial plot and interment (council)	$1,000 to $8,000
Celebrant or clergy	$300 to $900
Chapel hire	$200 to $500
Catering	$15 to $25 a head

The fixed part is the professional fee and the cemetery or crematorium fee. The flexible part is the casket, the venue, the catering, flowers, notices and live-streaming. Council fees reset each 1 July, and they differ a lot between councils; see funeral costs in New Zealand and our funeral cost guide for the line-by-line detail.

Step 3: subtract what will really be there

Money you could use is only money your family can reach quickly. Be strict about this.

Cash set aside for the purpose. Counts in full. Consumer NZ suggests a separate savings account and making sure someone in the family knows it exists (Consumer NZ: 5 ways to pay for your funeral).
The bank accounts of the person who died. The government says a bank can release money from the deceased's account to pay for the funeral, without waiting for probate (govt.nz: What to do when someone dies). Whether there is enough in the account is another matter.
KiwiSaver. Do not count it. The savings are paid to the estate, so they arrive with the other estate assets and cannot be counted on for the first week or two.
A prepaid funeral plan. Counts for the part it covers, and it also affects whether a grant is payable.
The Work and Income Funeral Grant. The maximum is $2,697.43, it is tested against income (for a partner or child) and assets, and prepaid funeral cover can stop you getting it (Work and Income: Funeral Grant). Do not size your cover on the assumption that you will get it. If the deceased was not your partner or child, their assets are deducted from the expenses first, and the assets that count include life insurance proceeds.
The ACC funeral grant. Up to $8,236.40, but only where the death resulted from a covered injury (ACC: Financial support after death). Do not plan around it either.

A worked example, with made-up round numbers

Suppose a 58-year-old wants a cremation with a service and expects it to cost about the FDANZ average of $11,700. She has $4,000 in a savings account set aside for this and no prepaid plan.

	Amount
Expected cost (FDANZ average, cremation with service)	$11,700
Set-aside savings	minus $4,000
Gap	$7,700
A cautious allowance for the top of FDANZ's range ($13,900)	$9,900 gap

On these numbers a benefit somewhere between about $8,000 and $10,000 would close the gap. She would be choosing within Momentum's $3,000 to $30,000 range, and the choice is hers. The same method with no savings gives a gap of $11,700 for the same funeral, and with $5,000 set aside for an unattended cremation it gives no gap at all. The example shows the method; it is not a recommendation of an amount.

Step 4: can you keep paying for it?

This step decides more outcomes than the first three. Momentum Life's Funeral Insurance premiums are level from the day you start until your 89th birthday, then stop, and cover continues for life. The rate can change for everyone on the same offer if tax law changes or claims experience is significantly different from expected, with 30 days' written notice. Total premiums can end up larger than the benefit, and the benefit may not cover the whole funeral. If you stop paying, or cancel after the 30-day free look from the Acceptance Date, you lose the premiums you have paid.

Momentum publishes no funeral premium, and QuoteHub does not print an exact premium for any insurer. The sum to do is simple. Get a quote at the benefit you are considering, multiply the monthly premium by 12, and multiply that by the years from your age to 89. Then ask whether you are comfortable with that total, and whether the monthly amount still fits your budget in a bad year. The break-even tables on our page on whether funeral insurance is worth it show how those totals compare with a benefit at different ages.

Momentum publishes no premium for any benefit amount, so price two amounts and compare.

What the 24-month rule does to the sum

Under Momentum Life's wording, for the first 24 months from the cover start date a benefit is paid only if the person dies as a direct result of an accident and within 90 days of it. An accidental death pays three times the benefit, so a $10,000 benefit pays $30,000. After 24 months the benefit is paid for death from any cause. If the person dies of anything else in the first 24 months, nothing is paid and all premiums for that person are refunded. If you may need the money sooner, funeral insurance is the wrong tool; see funeral insurance waiting periods. Size the benefit for a natural death after 24 months, not for the accident case.

If the sum comes out higher than $30,000, or lower than $3,000

Momentum caps the funeral benefit at $30,000 per person across all its funeral policies. FDANZ's scenario ranges top out at $17,000, so a gap above $30,000 usually means you are also covering other costs, such as debts or a family's living costs, and funeral insurance is the wrong product. Fully underwritten life cover through a licensed adviser can cover larger amounts if you can be accepted. If your gap is under $3,000, savings are likely simpler. FDANZ describes $10,000 as now "well below" a modest attended funeral; see $10,000 funeral cover for what that level does and does not do.

Savings and prepaid plans are legitimate answers

Funeral insurance is one option among several. Putting the money in a savings account has no waiting period and no premium to outlive. A prepaid plan fixes a price with one provider. Consumer NZ has called funeral insurance "poor value for money" in its research and suggests opening a savings account and putting money aside as an alternative, and a person with the means to save the gap may reasonably do that. Work through the same sums with our funeral cover amount calculator, and read what funeral insurance costs.

Where to get advice

General information, not personal advice. The buttons on this page open Momentum Life's online application, one option among many. Momentum Life Limited has a financial strength rating of B (Fair) from A.M. Best, affirmed 11 February 2026, which sits in A.M. Best's "Vulnerable" range on Momentum's own table; the rating is not a recommendation (see Momentum's 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. If you have a complaint about a Momentum policy, contact Momentum first (0800 108 108); if it is not resolved you can go to the Insurance & Financial Services Ombudsman Scheme (IFSO, 0800 888 202), a free service whose assessment is binding on Momentum. Advice is provided by Craig Smith Business Services Limited, trading as Smiths Insurance & KiwiSaver, a licensed Financial Advice Provider (FSP712931). Back to the funeral insurance hub or Momentum's Funeral Cover plan page.