Things to ask before purchasing a pre-paid funeral plan
17 July 2018
The pre-paid funeral plan market is ever-changing and the level of service required differs greatly from person to person.
Here are some questions you should ask before purchasing a funeral plan to ensure the product you choose best suits your needs.
Does the pre-payment plan provider have a relationship with your preferred funeral director?
Usually, when you purchase a pre-paid funeral plan directly from a plan provider, it is allocated by the plan provider to a funeral director in your area. This won't necessarily be the funeral director of your choice. If you know which funeral director you would like to carry out your service, we recommend speaking to them directly about a pre-paid funeral plan.
What will be included in the service?
Taking out a pre-paid funeral plan enables you to specify your exact funeral wishes. It may be that you wish to have the most modest of funeral services, with only the very basic options. Whatever your requirements, your funeral director will be able to provide accurate costs based on current and local funeral prices. It's important that you are aware of exactly what is covered by your funeral plan, so that both you and those you leave behind are reassured that it will be carried out as you wish.
How is my money held?
It's important to know exactly where and how much of your money is held when purchasing a funeral plan. There are generally two methods of holding funeral plan funds:
- In an independent trust fund. Here, the money you pay for your funeral plan is held in a trust fund and managed by a board of trustees. The trustees administer the money and decide how it will be distributed. The growing issue with this method is the lack of regulation surrounding the trust funds.
- In whole of life assurance policies. This is the method we use to hold funeral plan pre-payments. Every penny of your pre-payment (exclusing the initial management fee) is ring-fenced and held securely until the time of need.
Is the funeral plan provider registered with the Funeral Planning Authority?
Whether you purchase your funeral plan from a funeral director or directly from a plan provider, the funds are usually held by the funeral plan provider. In the UK, the regulatory body for the funeral planning industry is the Funeral Planning Authority (FPA), although registration with the organisation is not mandatory. The FPA exists to protect consumers and ensure funeral plan providers are operating in line with a strict Code of Practice. It is worth taking the time to ensure whichever funeral plan provider you choose is registered with the FPA.
What if your chosen funeral director goes out of business?
Check whether you are able to transfer your plan to a new funeral director and whether there are charges.
Can the funeral director arrange a funeral of a different standard from the one you have chosen?
Check whether you can tailor your plan to your individual wishes, make changes at a later date, and where there are any charges to do so.
What if there are outstanding payments at death?
Check if your plan allows you to use the payments you have made as a contribution to your funeral. Find out what happens if you stop paying your instalments – can you leave the funds in the plan to be used as a contribution towards your funeral at the time of need?
Other things to look out for include transport of the deceased to the funeral director's premises, advice on the registration of the death and collection of paperwork and collection for charitable donations. The best providers don’t simply provide you with the plan. They also offer your nearest and dearest support from a funeral director at the time when they need it the most.
Funeral plans come with an abundance of options, so it is important to take the time to go through the available products and services carefully and choose the plan that best meets your needs.