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Written by Mitch Tapner.
19 minute read
When you’re thinking ahead, it’s completely natural to want clarity around your options. Many people come across Tesco Life Insurance while looking into ways to help cover funeral costs and assume they offer a prepaid funeral plan. In fact, they do not. Tesco provides term life insurance, which works quite differently.
In this guide, we explain the difference between life insurance and funeral plans, including how each one works, what they cover, how payments are made, and what to consider when deciding which option feels right for you. We also take a closer look at Tesco’s life insurance, what it includes, and how it compares with a fully guaranteed Aura funeral plan.
Our aim is to help you feel confident in your decision, with a clear understanding of what each option involves, from what’s included and how it’s paid for to the peace of mind it may offer.
No, Tesco does not offer a prepaid funeral plan. They provide life insurance, including Family Protection (level cover) and Mortgage Protection (decreasing cover). These policies pay out a fixed cash sum if you die or are diagnosed with a terminal illness during the policy term.
Because funeral services are not included or arranged in advance, your family would need to organise the funeral themselves when the time comes. If costs have increased, or the service they choose costs more than the insurance payout, they may need to cover the difference themselves.
A funeral plan, on the other hand, allows you to arrange and pay for your chosen services ahead of time at today’s prices. This gives your family clear guidance and helps reduce both financial and emotional pressure during a difficult time.
Tesco offers life insurance, not a funeral plan. Here is how their policy works:
A few things to keep in mind:
If you’re thinking about funeral plans vs life insurance, it’s helpful to understand how each option works and what they are intended to cover. The table below offers a simple side-by-side comparison between a Tesco Life Insurance policy and an Aura Prepaid Funeral Plan.
| Feature | Aura prepaid funeral plan | Insurance payout (Tesco) |
|---|---|---|
| Type of product | Prepaid funeral plan with services secured in advance | Term life insurance with a cash lump sum benefit |
| What it covers | Funeral services such as cremation, transport and coffin, agreed in your plan | A cash lump sum paid to your beneficiaries if you die (or are terminally ill) during the policy term |
| Cost certainty | Funeral costs are locked in at today’s prices | The payout is fixed but may not keep up with potential inflation |
| Regulation | Regulated as a funeral plan by the FCA | Regulated by the FCA and PRA as a life insurance product |
| Risk of shortfall | No shortfall, services covered in full according to the plan | If used to pay for a funeral, the lump sum may not cover full funeral costs if prices have increased or services are more expensive |
| Peace of mind | Everything is arranged and paid for in advance | Your family will need to organise the funeral and pay for it at the time, using the money from the policy |
The main difference comes down to what each option is designed to do. Tesco’s life insurance gives your family a cash payout, which they can use in any way that’s helpful. This can offer flexibility, but it doesn’t guarantee that funeral costs will be covered in full or that arrangements will already be in place.
A funeral plan, like the ones offered by Aura, is focused on making sure your funeral is carried out as planned. The services are agreed in advance, the cost is fixed, and your loved ones won’t have to make decisions or pay extra for what’s included. It’s a way to reduce uncertainty and give real peace of mind.
A funeral plan is a way to make your wishes known and cover the cost of your funeral in advance. It allows you to put arrangements in place now, so your family has less to organise and worry about later.
With Aura, you can pay in full or spread the cost in monthly instalments. When the time comes, we will carry out your plan exactly as agreed. The services you’ve chosen will be delivered with no extra cost to those you leave behind.
Aura funeral plans are fully regulated by the Financial Conduct Authority (FCA), and your payments are protected by the Financial Services Compensation Scheme (FSCS). Everything you pay goes into a separate, professionally managed trust to make sure the money is there when it’s needed.
Select a plan that meets your needs from our range of highly-rated and fully-secure funeral plan options.
Speak to one of our lovely expertsℹ to secure your plan, or purchase your plan securely online in a few simple steps.
We’ll place your money into a secure, independently-managed trust, so that it’s ready to be used for when the time comes.
After you’ve died, we’ll bring you into our care and support your loved ones through the initial paperwork with patience and compassion.
We’ll let your loved ones know the date and time of your cremation, and on the day, transport you privately to the crematorium.
Within 21 days of the cremation, we’ll arrange to hand-deliver your ashes to your chosen person at no additional cost, or we’ll scatter them on their behalf.
*Before purchase, you’ll receive a clear summary of what’s included, what’s not, and your rights under the plan*
A funeral plan helps take care of the practical parts of a funeral. It gives the chance to make thoughtful decisions ahead of time, which can ease both emotional and financial pressure for the people left behind. While what’s included in a funeral plan can vary between providers, the following are always guaranteed with Aura:
What’s included with Aura?
What’s not included with Aura?
Aura’s funeral plans are designed to cover the essential, practical parts of a cremation. Some elements are not included as standard, but can often be arranged separately or added to a different type of plan if needed.
Every provider is different, so it’s important to look closely at what each funeral plan includes. Clear, honest information can help avoid any surprises later on – and that can make a difficult time a little easier for those left behind.
Aura has a variety of prepaid funeral plans to match different budgets and personal preferences. Whether your choice is attended or not, we’ll either scatter your ashes in the crematorium’s garden or deliver them by hand to someone close, usually within 21 days.
Our simple Direct Cremation Plan offers a simple and understated unattended direct cremation.
*Terms and conditions apply. You will receive a funeral plan summary before purchase.*
The cost of a funeral plan depends on several factors, such as the kind of service you want, how you choose to pay, and where you’re based. Some people prefer to pay in full, while others choose a monthly instalment option that suits their budget.
Aura’s unattended direct cremation is available for a fixed price of £1,695, regardless of your location. This option includes all the essential elements such as cremation, care of the person who has died, a simple coffin, and the safe return of their ashes. If you would rather pay gradually, Aura allows you to spread the cost over 12 to 24 months without any added fees.
If you would like to include a chance for close friends or family to say goodbye in person, an attended direct cremation might be a better fit. These services start at £2,395 for a short, 10-minute service with up to 15 guests. For a longer ceremony, plans from £2,995 include a 40-minute service at one of Aura’s partner crematoria, with space for a larger group.
By choosing a funeral plan in advance, you can secure today’s prices and avoid unexpected costs later. Once your plan is fully paid and active, the agreed services are covered. This can offer peace of mind for both you and your loved ones.
Whether or not a funeral plan is the right choice depends on your personal circumstances and what feels most important to you. For many people, it offers a practical way to plan ahead while easing the pressure on loved ones later.
If your goal is to make clear decisions in advance and avoid leaving your family with financial or emotional strain, a prepaid funeral plan could be a helpful solution. It gives you the option to take control now, while offering reassurance for the future.
One of the main reasons people choose a plan is to avoid potential rising funeral costs. According to SunLife’s 2025 Cost of Dying Report, funeral prices have continued to increase each year. By arranging your plan now, you can secure today’s prices and avoid paying more later.
A funeral plan isn’t the right choice for everyone, but many people find it reassuring. It offers cost certainty and the peace of mind that their wishes are in place and arrangements already taken care of.
Prepaid funeral plans can be an important part of end-of-life planning, helping you make thoughtful decisions now to ease the burden on your loved ones later. Compared with simple life insurance, funeral plans offer key advantages:
*Funeral plans may not be suitable for everyone. Some services are not included as standard. Please check the plan summary before purchase*
When choosing a funeral plan, it’s reassuring to know that funeral plan regulation is in place to protect you and your money.
All prepaid funeral plans in the UK are regulated by the Financial Conduct Authority (FCA). This means providers must follow strict rules — they must treat you fairly, explain exactly what’s included in your plan, and keep your money safe, usually in a secure trust or insurance policy.
This regulation also means you have clear rights. You’ll know how to cancel if needed, what to expect from the service, and where to turn if something goes wrong.
Your payments are also protected by the Financial Services Compensation Scheme (FSCS), which offers extra security if the provider were ever to go out of business.
One challenge with life insurance is that the payout might not match the actual cost of a funeral when the time comes. For example:
*Please note, these figures are for illustrative purposes only and may not reflect your circumstances.*
With an Aura funeral plan, the services you choose are covered in full, with no shortfall for what’s included. It’s a simple and secure way to pay for funeral expenses in advance, helping to make sure everything is taken care of when it’s needed most.
There is no single provider that will be right for everyone. The best funeral plan depends on what matters most to you, such as your budget, the kind of service you want, and how involved you would like your family to be when the time comes.
Still, many people choose Aura for a number of important reasons:
Clear, honest pricing
Aura is upfront about what each plan includes, so you know exactly what you are paying for. There are no hidden fees, and you can choose to pay in full or in monthly instalments, depending on what suits you.
FCA regulation and strong protections
Aura is authorised and regulated by the Financial Conduct Authority (FCA), which means your money is securely managed and only used for your plan. You are also covered by the Financial Services Compensation Scheme (FSCS), offering added reassurance.
Simple, flexible plan options
Aura offers several plan options to suit different needs. Whether you prefer a simple direct cremation or want something more personalised, there’s a plan to match. If cost is a deciding factor, direct cremation prices are among the most affordable, without compromising on care or quality.
Kind and compassionate service
Planning ahead can be an emotional step, but Aura’s team is known for being warm, helpful, and easy to talk to. They take time to explain your options clearly and are there to support you throughout.
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|---|---|---|---|---|---|
| Starting Price | £1,695 | £2,095 | £1,700 | £1,700 | £1,885 |
| Trustpilot | 4.9/5 stars | 4.8/5 stars | 4.6/5 stars | 4.8/5 stars | 4.4/5 stars |
| Fairer Finance | |||||
| All-Inclusive Pricingℹ | |||||
| Transparent Pricingℹ | |||||
| Free Cancellation Anytimeℹ |
It is completely reasonable to ask what would happen if a funeral plan provider were no longer able to operate. That is why funeral plan regulation, overseen by the Financial Conduct Authority (FCA), exists to protect customers and ensure their money is used only for the funeral services they have arranged.
FCA-authorised providers must follow clear rules. These include keeping customer payments in a secure trust or placing them under a regulated insurance policy. This approach helps to make sure that the funds are available when needed, even if the provider experiences financial difficulties.
At Aura, every customer payment goes into an independently managed trust. You can find full details about how we keep your money safe on our website.
If a provider does stop trading, there are systems in place to protect your plan. In most situations, your plan would be transferred to another approved provider, so your funeral can still go ahead as arranged. If this is not possible, you would receive a refund. In certain cases, you may also be able to claim through the Financial Services Compensation Scheme (FSCS).
These protections are designed to give you confidence that both your money and your wishes are secure, no matter what happens.
Every person’s needs and priorities are different. Tesco offers life insurance, which provides a cash payout to your loved ones. Aura provides prepaid funeral plans, which focus on arranging and covering the funeral itself. Each option supports families in different ways.
If you want to make arrangements in advance and be sure the funeral costs and services are already taken care of, a prepaid funeral plan may be the better choice. That said, only you can decide what feels right for your situation.
Taking some time to explore your options can help you make a decision that works for you and your family, both emotionally and financially.
What Aura offers:
If you are not sure which option is the best fit, we are here to help you compare funeral plans clearly and simply. Whether you are thinking about a direct cremation or something more traditional, we will guide you through your choices with care and honesty.
At Aura, we believe in treating every person that turns to us as if they were our own family. This dedication has earned us an exceptional 4.9/5 Trustpilot rating, making us the highest rated ‘Cremation Services’ provider on the platform.
We’re honoured to be a trusted partner for families across the UK. Read their stories below.
Some companies offer funeral insurance, which pays out a lump sum when you die. Your family can use this money in any way they choose, including to help with funeral costs. However, it doesn’t guarantee that a funeral will be arranged or fully paid for.
It’s also important to know that Tesco’s Life Insurance isn’t funeral insurance. It’s a form of life insurance, which works a little differently.
A funeral plan is different again. It allows you to arrange and pay for specific funeral services in advance. Everything is agreed ahead of time, and when the time comes, those services are carried out as planned. This can ease financial pressure and bring a sense of clarity for the people left behind.
If your plan is fully paid and active, the services it covers will not cost your family anything further. This usually includes cremation, care of the person who has died, and a basic coffin.
If your family wants something not included in the plan, such as flowers, a venue, or additional vehicles, those would need to be paid for separately.
In most cases, yes. Providers often offer a cooling-off period where you can cancel and get a full refund. After that, some may charge a cancellation fee or return only part of what you have paid.
With Aura, you can cancel at any time. There are no cancellation or admin fees, and if no services have been provided, everything you have paid will be refunded. We aim to keep things clear and flexible from the start.
Yes, and many people do. They work in different ways.
A funeral plan covers the funeral arrangements. It guarantees specific services will be provided, and it fixes the cost at today’s prices.
Life insurance provides a cash payout. Your family can use this money however they choose, including to help with funeral costs. It offers flexibility, but it does not guarantee that the funeral will be arranged or fully covered.
With a product like Tesco’s Life Insurance, the payout is fixed. If the cost of a funeral goes up over time, the payout might not be enough, and your family may have to cover the difference.
An Aura prepaid funeral plan works differently. It fixes the cost of your chosen services at today’s prices, so your loved ones are protected from rising funeral costs. It is a simple way to pay for funeral expenses in advance and make sure everything is in place when it is needed.
If you’d like to know more about how to plan a cremation with Aura, our brochure is a helpful place to begin.
Our funeral plans are a helpful way to put everything in place for you or someone else.
When the time comes, our experienced team will be here to guide you through each step, offering support and advice whenever you need it.
To find out more about how our plans work, what’s included, and our story, you can request a brochure by clicking the link below. We will then send you a copy by email or First Class post—whichever you prefer.