Funeral insurance acts just like life insurance; you pay a monthly fee and the money is given to your family when you die to pay for your funeral.
You gain interest, so it covers inflation costs.
This money is always set aside for the funeral, so while other debts accrue from medical bills you know this money is always there.
Funeral insurance can be overpriced compared to other types of insurance policies.
Some insurance plans decrease their benefits after you reach a certain age.