Demand for preneed insurance, covering prefunded funeral arrangements, rose in 2024, based on the Life Insurers Council (LIC) annual preneed sales survey. Among 16 survey respondents, total cases exceeded 517,000, equating to $2.9 bn in sales.
Independently and also with the support of LIMRA research staff and member companies, LIC conducts systematic surveys and benchmark reports on topics that are of interest to our members.
We have been tracking sales data for the Final Expense and Preneed markets for many years, and offer participating member companies the opportunity to include questions of interest to them.
Preneed insurance, often offered by funeral service providers, allows customers to prepay funeral and burial expenses. These policies are generally smaller than other life insurance options, according to U.S. Annuity Insurance Sales.
Single-premium policies led the market, comprising 57% of sales, while multi-pay policies made up 40% and annuities 3%.
In 2023, single-premium policies had an average face amount of $5,352, multi-pay policies averaged $6,356, and preneed annuities averaged $4,803.
Among nine companies with consistent three-year reporting, 2023 sales reached $1.5 bn, reflecting an 8% increase over the previous year.
Dean Lambert, LIC’s executive director, noted significant growth in multi-pay policies — which spread payments over 3 to 10 years — outpacing single-premium policies by three times, with a 25% year-over-year rise in multi-pay policy count.
He attributed this growth to consumers’ rising awareness of inflation risks tied to future funeral costs.
The growth in the multi-pay market — where policyholders pay in installments over 3 to 10 years — outpaced the single-premium market three-fold. Multi-pay policy count jumped nearly 25% year over year in 2023
Dean Lambert, executive director, LIC
“We believe the growth in preneed products overall and multi-pay policies specifically, reflects consumers’ heightened awareness and desire to mitigate inflation risks associated with future funeral costs,” said Dean Lambert.
Although annuities represent only 3% of preneed sales, they’re an expanding segment. Preneed annuity sales rose 7% in 2023, following a 14% increase in 2022. More than 14,500 annuity contracts were sold through preneed distributors in 2023, a 1% rise over 2022.
