An affinity for lavish funerals is proving costly for Africa’s poor

While insurance companies in the US, UK and Europe make the bulk of their money covering cars, homes and other material goods, their African counterparts are cashing in on the continent’s custom of hosting pricey funerals.

In Africa, big, dignified burials are signs of prosperity, and small, restrained ceremonies are just the opposite. So Africans stretch their finances, often to unseemly ends, to fund funeral insurance so relatives can have a proper burial.

On average, funerals in Africa cost a staggering 40% of annual household expenditures, according to Foreign Policy, and include elaborate coffins, food for guests, requisite new clothing, and transportation to and from the ceremony. Funeral insurance hedges their ability to cover expenses. At Sizo Funeral Directors, a small funeral-insurance company based out of Soweto, South Africa, the cheapest package affords a $500 funeral, and covers up to 14 people for as little as $12 dollars a month. Larger packages run upwards of $50 dollars a month, and often much more. Consider that in South Africa, the continent’s wealthiest country, non-farm workers make less than $1,500 a month. Funeral insurance policies tend to be bought on behalf of households, meaning that many Africans are covered for large portions of, if not most of their lives.

High death rates and low savings levels have made it easy for African insurance companies to swoop in. In South Africa, the continent’s biggest economy, funeral premiums totaled nearly $500 million in 2011, according to the country’s Financial Services Board (FSB). Global bank Standard Chartered is seeing double-digit growth in its funeral insurance business in five African markets, reports Reuters. With mortality rates falling, opportunities to capitalize on the cultural trend will only grow, as insurers will likely see customers locked into policies for longer.

Unfortunately, it’s Africa’s poorest who are driving the industry’s growth.

Funerals often mean large swaths of family, friends and strangers, adding to the costs of food and clothing, when provided.
Funerals often mean large gatherings of family, friends and strangers, adding to the costs of food and clothing, when provided. (Reuters/Akintunde Akinleye)
Coffin business
Choosing the right coffins can also prove a pricey affair. Here, a coffin salesman sits at his desk at his business in the Ivory Coast. (Reuters/Luc Gnago)
There are, of course, more straight forward caskets.
There are, of course, straightforward caskets. (Reuters/Siphiwe Sibeko)
Crazy coffins
But there are more outlandish options, like fish-shaped coffins, to choose from as well. (Reuters/Luc Gnago)
Heart-shaped coffin
Including coffins with heart-shaped openings. (Reuters/Noor Khamis)
Film projector coffin
And elaborate film projector-shaped ones. (Reuters/Luc Gnago)
Exodus Funeral Services
Often, they are even custom made. Bereaved relatives wait to pick newly built coffins from a roadside showroom in Nairobi. (Reuters/Noor Khamis)
Funeral services
Transporting the coffin, decorating the grave and attending to other odds and ends is another service in itself. Here, a board displaying funeral services is pictured on the doorway of a showroom for newly built wooden coffins. (Reuters/Noor Khamis)
Funeral coffin liner and clothing
Both coffin-liners and clothing for funerals are often custom made, too. (Reuters/Noor Khamis)
Grave statues
And there is no shortage in the use of ornaments. Here, sculptures are mounted on tombstones at a cemetery in Lagos. (Reuters/Akintunde Akinleye)
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