Life insurance is certainly NOT exclusively for the funeral. My father took out a policy for all of us kids, when we were born and we did the same for our sons. We have always had it - it was for those "what if?" situations and to help the rest of us along, should one of us die. When you die, the proceeds are NOT taxed nor are they considered part of the estate. They are paid out to the beneficiaries directly. So, if you have anyone you think might seriously miss you when your gone - then life insurance is a good option. You can also leave it to charity if you wanted to do something like that and cannot afford to be so generous during life.
I have been a fan of the whole life policy too. We have been able to borrow against it, along the way (which doesn't show up on a credit report) and there is cash value building up, should we need it along the way or have to cash it out eventually. We have always paid it back too, which keeps the integrity of the policy. But, we have all had spouses and children to consider - as we edge past retirement age, it doesn't seem quite as important I suppose. Also depends on what kind of funeral or burial you have in mind and what financial burden that will place on whomever is left to deal with it. We never pre-paid those arrangements since we have moved around so much and are still facing relocation.
