A funeral is an occasion for reflection and personal accountability. It is not an invitation to claim certainty about the private spiritual state or ultimate outcome of a particular deceased person. We do not know every aspect of people’s inner lives or their standing before Allah.
The companions asked a respectful question when the phrasing needed explanation. That is itself a useful model: request clarification rather than guessing at a religious statement.
For the living, the practical lesson is to avoid harming others, fulfill responsibilities, and continue moral improvement while hoping for Allah’s mercy.