Does Life Insurance Cover Funeral Costs? 
Yes , life insurance can be used for funeral expenses or anything else your beneficiary would choose . The life insurance policy designated especially for funeral expenses is called a final expense plan . However , any type of life insurance be it whole life , universal life or term life insurance proceeds can be used for funeral and final expenses . Life insurance proceeds can also be used for repaying debts , funding a child 's education or invested to replace the income of a loved one 's income . The nice benefit about life insurance proceeds if set up properly are tax free . 