How do pre-paid funeral plans work?

28 August 2018

Pre-paid funeral plans are an often cost-effective way to make financial provision for your funeral service in advance.

How do pre-paid funeral plans work?

Here, we break down exactly what that means and the questions you should ask when taking out a pre-paid plan.

What is a pre-paid funeral plan?

A pre-paid funeral enables you to make arrangements for your own funeral in advance as well as paying for your selected funeral director’s services and making a contribution towards third party funeral services. Put simply, it is arranging and making financial provision for the funeral service you’d want before you need it.

What arrangements can I make?

You can make any arrangements you want to with a pre-paid funeral plan. Your funeral director will simply put together a tailored funeral service to suit your requirements. Many funeral directors offer set plans, which are pre-packaged to include a predetermined list of services, but if you require something more bespoke the only limit is your imagination.

Where is the money held?

This depends on the funeral plan provider your plan is held with. To be clear, in most cases the funeral director who sells you the funeral plan does not hold the money themselves. For your protection, the funeral pre-payment is paid directly to the plan provider and they hold the money securely until the funeral service is required. Funeral plan monies can be held in trust funds or in whole of life assurance policies. Ecclesiastical Planning Services holds funds in whole of life assurance policies where every penny of your money, excluding the initial management fee, is held securely and ring-fenced for your funeral at the time of need.

Are all pre-paid funeral plans the same?

No. Funeral plan providers differ greatly in operational practices, size and the relationships they each have with funeral directors. Ecclesiastical Planning Services has strong relationships with a large network of funeral directors across the UK and securely holds funeral plan funds. Transparency, fairness and financial security, along with ‘doing the right thing’ are at the heart of our approach.

Where can I get a pre-paid funeral plan?

There are a number of places you can take out a funeral plan including online, through your local funeral director and via salespeople at events or over the phone. We recommend speaking to your local funeral director about your pre-paid funeral plan. As the industry expert in your community, your funeral director is best placed to provide suggestions and ensure you receive the service you want. You may even get a better price.

Is there anything else I should know?

Make sure you are clear on how much of your funeral plan pre-payment will go towards third party costs, known as disbursements. Most funeral plans do not cover the full cost of third party costs, such as cremation or burial, because these fees are beyond the funeral director’s control. The amount included in each plan differs greatly.

If you choose to purchase a funeral plan directly from a funeral plan provider, it is also important to check that they have an existing relationship with your chosen funeral director. And finally, it's a good idea to ensure that your funeral plan provider is registered with the Funeral Planning Authority and adheres to its strict Code of Practice.

For more information about making financial provision for the cost of your funeral, speak to your local funeral director or arrange a home visit.