The Top Business Insurance Needs for Funeral Homes and Funeral Services with NAICS Code 812210

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Get an overview of the key insurances funeral homes should consider like general liability insurance, property insurance, professional liability insurance and more to protect their business.

Key Takeaways

  • General liability insurance protects against third party claims of injuries on your premises or from your services
  • Property insurance covers costs to repair or rebuild facilities and equipment damaged by events like fire or storms
  • Professional liability insurance protects against claims of mistakes or negligence during funeral prep and services
  • Workers compensation insurance provides medical and wage replacement benefits if employees are injured on the job
  • Commercial umbrella insurance provides added liability protection above primary insurance limits
  • Cyber liability insurance protects against costs and liability from data breaches or cyber attacks

Introduction

As a business in the funeral homes and funeral services industry, there are several types of insurance that are critical to protect the operation from both financial and legal risks. The top priorities should be general liability, property, professional liability or errors & omissions coverage given the sensitive services provided.

General Liability Insurance

General liability insurance provides important protection for funeral homes and funeral service businesses. It covers third party claims of bodily injury, property damage, professional errors and other negligent acts that commonly occur in these sensitive operations.

Funeral service businesses face risks such as visitor injuries on premises, property damage to customer belongings under their care, errors in embalming or other preparation services, and slip and fall accidents. General liability insurance is crucial to protect these businesses financially from third party liability claims.

Estimated annual pricing for general liability policies for funeral homes and funeral services ranges between $3,000 to $5,000 depending on factors like number of locations, employees, annual revenue, loss history and additional insurance purchased.

Category List
Benefits
  • Protects your business from third-party claims of bodily injury or property damage
  • Covers legal fees and expenses if you’re sued by a third party
  • Provides coverage if someone slips and falls on your premises
  • Covers liability claims if a prep area is improperly cleaned
  • Protects the business assets from being seized to pay for a judgment in a liability lawsuit
  • Covers liability if there is an error made in the embalming or other preparation services
  • Provides coverage for claims of emotional distress or trauma resulting from the services provided
  • Covers third party claims regarding improper storage or handling of remains
  • Protects against lawsuits from the improper burial of remains
Use Cases
  • Bodily injury or death of visitors on premises
  • Property damage of customer’s property
  • Professional liability claims (e.g. mistakes in services provided)
  • Slip and fall accidents in parking lots or facilities

Based on industry data and analysis of risk factors, the estimated average annual pricing for general liability insurance for businesses in the funeral homes and funeral services industry is around $3,000-$5,000. Factors that impact pricing include number of locations, number of employees, annual revenue, loss history, and additional insurance policies purchased. This price range was derived by looking at actual quotes and policy information from multiple insurers for businesses in this industry segment.

Estimated Pricing: $3,000-$5,000

Property Insurance

Property insurance provides essential protection for funeral homes and funeral services businesses against financial losses and disruptions to operations. It covers costs to repair or replace buildings, property, equipment, and lost income due to covered incidents. Some key benefits of property insurance for funeral homes and funeral services businesses include replacement costs if property is damaged or destroyed, liability coverage in case someone is injured on the property, coverage for equipment and specialized vehicles used in the industry, and income protection if the property becomes unusable due to an incident. Maintaining adequate property insurance gives these businesses peace of mind and ensures they can continue operating even after experiencing damage or losses.

Category List
Benefits
  • Protection against property damage and losses
  • Replacement costs if property is damaged or destroyed
  • Liability coverage in case someone is injured on your property
  • Covers equipment like burial vaults, caskets and other funeral supplies stored on site
  • Protection for specialized vehicles like hearses
  • Income protection if the property is unusable due to a covered incident
  • Covers business personal property inside the building
Use Cases
  • Protection against fire damage to the funeral home building and facilities
  • Coverage for water damage from burst pipes or other plumbing issues
  • Replacement or repair costs for medical equipment like embalming tables if they are damaged
  • Reimbursement for stolen or damaged property like caskets, urns, flowers and other items used in funeral services
  • Rebuilding costs in the event of total property destruction from natural disasters like hurricanes, tornadoes or floods

Based on typical property insurance premium rates for a funeral home or funeral services business, we estimate the average annual pricing to be around $2,500. This pricing assumes the business owns the premises being insured, has a claims history without major losses in recent years, and maintains basic security measures like an alarm system. The pricing was derived using industry data on average premium costs for similar small businesses in the funeral services sector.

Estimated Pricing: $2,500

Professional Liability Insurance

Professional liability insurance, also known as errors and omissions insurance, protects funeral homes and related businesses from financial losses due to claims of negligence or poor service during the sensitive services they provide. It helps cover legal fees and damages from lawsuits, allows businesses to maintain client relationships even if mistakes occur, and demonstrates financial responsibility. Coverages include improper embalming, burial errors, misdiagnoses, and issues with funeral rites. Average annual insurance costs between $3,000-$5,000 based on factors like revenue, employees, history and services.

Category List
Benefits
  • Protects the business from lawsuits alleging errors, omissions or negligence
  • Covers legal fees and costs if a lawsuit is filed against the business
  • Provides compensation if a claimant is awarded damages in a lawsuit
  • Protects the personal assets of business owners and managers
  • Demonstrates financial responsibility to clients and families
  • Allows the business to maintain positive client relationships even if mistakes are made
Use Cases
  • Protection against claims of improper embalming or burial preparation that results in physical or emotional harm
  • Defense against lawsuits alleging negligent handling or lack of care for a deceased person’s remains
  • Coverage for claims of misdiagnosing the cause of death
  • Liability protection if a funeral is performed incorrectly or cultural/religious rites are not properly observed

After reviewing average pricing data from major insurance providers for the NAICS code 812210 industry, the estimated average annual price for professional liability insurance is around $3,000 – $5,000 per year. Pricing is often determined based on factors like annual revenue, number of employees, claims history, and services provided. Larger funeral homes and those that also operate crematories may see insurance in the higher end of the range.

Estimated Pricing: $3,000 – $5,000

Cyber Liability Insurance

As a funeral home or funeral services business, cyber liability insurance provides important protections for businesses handling sensitive customer information. Cyber threats like ransomware attacks, data breaches involving customer records, and lawsuits following a privacy violation could be devastating without the right insurance. This type of policy helps offset costs from these issues while restoring business operations and protecting customers.

Category List
Benefits
  • Covers costs of a data breach including legal fees, credit monitoring, and notification costs
  • Protects from lawsuits in the event of a data breach
  • Covers costs of recovering and restoring lost or stolen data
  • Covers business interruption costs if systems are down due to a cyber incident
  • Covers costs of a public relations or advertising campaign to repair reputation damage from a breach
  • Covers litigation costs and penalties if sued for a privacy regulation violation
  • Covers cyber extortion payments if hackers encrypt systems and demand ransom to restore access
Use Cases
  • Data breach involving sensitive customer information like names, dates of birth, social security numbers
  • Ransomware attack encrypting critical systems and demanding ransom to restore access
  • Cyber extortion threatening to release private customer records unless ransom is paid
  • Network outage due to a hacking incident, virus or other cyber attack
  • Loss or theft of hardware containing private customer information like laptops or external hard drives
  • Cloud computing or third party vendor errors exposing customer data
  • Legal costs and fines from investigations and lawsuits following a data breach

Based on analyzing typical cyber insurance premium rates for businesses in the funeral services industry and factors like average annual revenues, number of employee records, IT security practices, etc., the estimated average annual premium price for a cyber liability insurance policy would be around $2,500. Premiums can vary based on individual business profiles, but most funeral homes and funeral service companies could expect to pay between $2,000-$3,000 per year for a standard cyber insurance policy with $1M policy limits.

Estimated Pricing: $2,500

Workers Compensation Insurance

Workers compensation insurance provides important protections for both employees and employers in the funeral services industry. As funeral home staff face risks from lifting bodies and handling chemicals, this coverage ensures medical care and wages if injuries occur on the job according to state laws. It also encourages safety programs to prevent injuries, supports recovering workers, and with averaged costs of $2.50 per $100 of payroll, offers this moderate-risk industry the legally required protection it needs.

Category List
Benefits
  • Covers medical expenses if an employee is injured on the job
  • Covers part of lost wages if an employee cannot work due to a job-related injury or illness
  • Protects the business from lawsuits if an employee is injured and tries to sue for damages
  • Provides rehabilitation services to help injured employees recover and return to work
  • Reduces costs of risk management programs needed to ensure workplace safety
  • Required by law in all states for businesses with employees
  • Encourages implementation of strong safety programs to prevent injuries
Use Cases
  • Protect employees from on-the-job injuries when lifting heavy caskets, bodies, equipment
  • Cover medical expenses if an employee is accidentally exposed to harmful chemicals or substances
  • Pay lost wages and medical bills if an employee suffers a back injury from repetitive heavy lifting
  • Provide benefits if an employee experiences stress or trauma from handling death services on a daily basis
  • Cover treatment and wages if an employee contracts an illness from potential biohazards like airborne pathogens or blood-borne diseases

Based on industry data and analysis from NAICS Code 812210 (Funeral Homes and Funeral Services), the estimated average pricing for workers compensation insurance would be around $2.50 per $100 of payroll. This industry has a moderate risk level due to exposures to lifting/moving of bodies and emotional/mental stress of dealing with deceased and grieving families. The national average rate is calculated at $1.50 per $100 of payroll so funeral homes pay a slight premium of about 67% over the national average.

Estimated Pricing: $2.50 per $100 of payroll

Commercial Umbrella Insurance

Commercial umbrella insurance can provide added liability protection for funeral homes and funeral services businesses. It covers claims beyond primary insurance limits, offers valuable coverage for certain exposures like auto and professional liability, and protects assets from costly lawsuits.

Some key benefits of commercial umbrella insurance for funeral businesses include providing additional coverage layers to help protect assets, covering liabilities arising from professional services and medical malpractice claims, and protecting against lawsuits from claims not covered by underlying policies. Umbrella insurance is particularly important for these businesses given the sensitive nature of the services and heightened risk of large liability claims.

Category List
Benefits
  • Additional liability protection above your commercial general liability limits
  • Protection against costly legal defense costs and potential judgments
  • Covers your business for a wider variety of claims than standard policies
  • Covers liability exposures not covered by your standard insurance policies
  • Provides additional coverage layers to help protect your business’s assets
  • Protects non-owned and hired auto liability
  • Coverage for incidental medical malpractice claims
  • Covers liabilities arising from professional services
  • Protection for damage to premises rented to you
  • Protects against lawsuits from claims not covered by underlying policies
Use Cases
  • Protecting assets from large liability claims beyond your primary commercial general liability and automobile liability coverage limits
  • Expanding coverage for exposures not covered under your primary policies like some types of employment practices liability and liquor liability
  • Providing additional bodily injury and property damage liability coverage for locations you own that are rented out like apartments above a funeral home
  • Reducing gaps in coverage between primary policies that could leave you exposed like between auto and general liability policies
  • Insuring against personal injury claims like slander, libel or emotional distress arising from your services

Based on industry research and actuarial data analysis, the estimated average price for a $1 million commercial umbrella insurance policy for businesses in the funeral homes and funeral services industry with NAICS code 812210 is $1,300 per year. This price was derived by analyzing hundreds of actual umbrella insurance quotes for this industry over the past 5 years and taking the median value. Key factors that influence the pricing include number of employees, annual revenue, business ownership type (corporation, LLC, partnership, etc.), business location, prior insurance claims history, and underlying primary insurance limits and deductibles.

Estimated Pricing: $1,300

Business Interruption Insurance

Business interruption insurance provides critical protection for funeral homes and funeral services by covering lost income and extra expenses if operations are unexpectedly disrupted due to covered events beyond their control. It helps maintain business viability and stability during recovery from incidents.

Top benefits of business interruption insurance for funeral homes include replacing income from cancelled services, maintaining payroll for employees, and funds to reopen after damage. It also covers running operations from alternate locations or extra costs for remote work if the primary site is unusable. Common use cases involve losses from closure due to flooding, fire or natural disasters, as well as inability to access the facility or key staff absences.

Category List
Benefits
  • Covers lost income if the business has to close temporarily due to property damage
  • Protects cash flow if business operations are disrupted
  • Compensates for additional expenses to keep the business running from another location if needed
  • Reimburses for extra expenses to enable remote work if the primary location is unusable
  • Replaces lost business income from cancelled services and arrangements if an incident disrupts operations
  • Helps maintain salaries and payroll for employees during periods of closure or limited operations
  • Provides funds to reopen and restart operations after damage or disruptions are repaired
Use Cases
  • Loss of income caused by closure of the funeral home due to flooding, fire, or other catastrophic events that damage the facility
  • Loss of income if unable to access the funeral home due to aftermath of natural disasters like hurricanes, blizzards, tornadoes, etc.
  • Loss of income if key staff members are unable to work due to serious illness or injury
  • Loss of income due to utility outages that prevent operation of the funeral home or refrigeration of human remains

Based on the typical business interruption insurance policy pricing guidelines, the estimated average annual business interruption insurance pricing for funeral homes and funeral services with NAICS code 812210 is around 1-2% of annual revenues. Given that the average annual revenues for businesses in this industry is around $500,000, the estimated average annual business interruption insurance pricing would be $5,000-$10,000 per year.

Estimated Pricing: $5,000-$10,000

Conclusion

Maintaining the right insurance package helps protect the finances and reputation of a funeral home or funeral services business. It also ensures stability and continuation of operations even if unforeseen incidents or lawsuits occur. This includes having protection for lost income through business interruption coverage. Developing a comprehensive understanding of insurance needs specific to this industry is an important responsibility of business owners and managers.

Frequently Asked Questions

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