With the pension as her only source of income, the premiums are now too much for her to afford.
But if she cancels the policy, she will lose the $9000 she has paid into the scheme, leaving her sons to cover the cost of her funeral.
"If I stop paying I will get nothing, even though I have paid all this money."
The Herald on Sunday has decided not to name the insurer in question at this stage because sources say that will jeopardise a complainant's chances of getting a favourable settlement through official channels.
She said her sons had suggested she stop paying the premiums but she did not want to be a burden.
"It's pretty hard going when you have been paying into something for more than 10 years. There must be an awful lot of people in my position. I went to see a lawyer and he said 'Vera, why do you think they put the rules in the small print? It's so the elderly can't read them'."
Insurance and Savings Ombudsman Karen Stevens said Beale's was a common complaint. "People have the mistaken idea that they are paying into a savings plan."
The policies appealed to older people who were trying to get their finances in order, she said, particularly those who had seen friends' families struggle with the costs of a funeral.
She said while some insurers offered policies that allowed people to stop paying premiums once they had paid in a set amount, such as $9000, most policies operated like any other risk insurance.
"It doesn't matter how much they pay in, if they stop paying they don't get any money back, the policy will lapse and with it all the premiums."
People commonly took out the policies in their 60s or 70s, she said, and ended up paying premiums for longer than they expected.
"Most documentation makes it clear but as with a lot of things, they often don't read it."
Stevens' office recently settled a case in favour of a complainant in the same position as Beale.
But she said it was often hard to get a complaint to stick.
"It depends on the advertising material and whether it was made clear at the outset that they might have to pay in more than they would get out. If it was, there is very little you can do."
Financial adviser Sean Minhinnick said it would be worth Beale asking for advice on other policies.
"Many policies offer level premiums which can provide you long-term budget certainty.
"Many of these policies provide cover with no medical questions, however they only offer limited cover for the first year or two, normally linked to a return on premiums paid."
Stevens said Beale should contact her office to make a complaint.
Tell us your story. Have you paid more into a funeral plan than you'll get out? Email susan.edmunds@heraldonsunday.co.nz
