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Burial Benefits. 1  Under the current regulations, VA pays for burial and funeral expenses on a reimbursement basis, which requires survivors to submit receipts for relatively small one-time payments that VA generally pays at the maximum amount permitted by law.
If you have life insurance that cannot pay for the cost of a funeral, or if you do not have life insurance, there are still several options for ways to pay for a funeral:1  Opt for a lower-cost ceremony by comparison shopping and removing expensive âextrasâ from the service.n that regard, using life insurance to pay for a funeral should be no problem. The concern with life insurance is that the payout may take a long time to process, and the funds may not be available right away for use on funeral expenses.