Why Buy a Funeral Plan
A funeral plan allows you to pay for your future funeral now, at today’s prices. However, that is only one of the advantages. More important is the reassurance that all the arrangements have been made and your family aren’t left with potentially difficult choices – or the costs. Funerals can be expensive, so pre-paying reduces concerns about future inflation.
Some people don’t like to talk about death, or funerals, whether it’s their own or a family member’s. A funeral plan makes things easier for everyone by taking care of the arrangements and fixing many costs in advance, avoiding any doubts about what you might have wanted. When the time comes, one phone call to your funeral director or provider will activate your plan. Everything will then be taken care of, and carried out according to your wishes, helping to relieve your family of stress and worry.
A funeral plan can include whatever the planholder wishes. We are all individuals, and our funeral wishes are deeply personal. Some people seek the simplest unattended cremation while, for other families, it is important to have a full, traditional funeral. Funeral plans of all types are available, with many providers offering bespoke plans to personalise the service. It’s important to check what’s available in your area and to compare what’s included in the plans from the various providers. High street funeral directors can provide information or you may prefer to collect your information online or by telephone. You’ll find a directory of all our members here, all are authorised by the Financial Conduct Authority.
As everyone has different needs when it comes to funeral planning, our members offer a range of plans that cover most situations allowing you to pick the plan that best suits your wishes and your budget.
Will my money be secure?
A funeral plan is almost the only time when an individual will enter into a contract fully aware that they will not be around to witness the service being delivered. For that reason alone, it is a service that deserves the highest standards of integrity by the plan provider and the tightest regulation to protect the consumer. Funeral plans can only be offered by providers authorised by the Financial Conduct Authority for that purpose. This means all plan providers have to be FCA authorised and planholders benefit from the added protection of the Financial Services Compensation Scheme (FSCS) should the need ever arise.
All funeral plans require the funds to be held separately from the plan administrator. Monies will be safe and protected at all times. After the deduction of any administration fee, the sum paid will either be placed into a whole of life insurance policy or into Trust. If the latter, the Trust must be independent and specifically incorporated for the sole purpose of holding funds required to pay for the funeral eventually. Such Trusts are governed by a Trust Deed which meets the requirements of the FCA.
In the unlikely situation of a provider failing, the funds are secured and the insolvency practitioner would seek a transfer a plan to another provider or return your monies. If such a transfer is not possible, you would be entitled to compensation under the FSCS.
Financial Services Compensation Scheme
Funeral plans provided by our members are protected by the Financial Services Compensation Scheme. The FSCS is a body funded by the financial services industry, which provides automatic protection if a funeral plan provider goes out of business. You can find more details at www.fscs.org.uk or by emailing enquiries@fscs.org.uk or phoning the FSCS on 0800 678 1100 or 0207 741 4100.
If your plan has been transferred to an FCA-authorised funeral provider, the plan will be protected by the FSCS if the provider fails. You’ll also be able to refer a complaint about your new provider to the Financial Ombudsman.
For all types of funeral plan claims, you are protected up to £85,000 per eligible person, per firm. If you choose to receive compensation, FSCS will calculate the amount by reference to what it would cost to buy the same plan on today’s market.
If your funeral plan provider goes out of business, it should have arrangements in place to ensure that a new regulated provider can carry out your funeral plan. Alternatively, it may provide you with compensation. If these arrangements aren’t in place, FSCS will protect planholders of authorised funeral plan providers that have failed.
The Financial Ombudsman Service
The Financial Ombudsman service (FOS) will investigate a complaint against a plan provider when it cannot be resolved to the customer’s satisfaction. The FOS can look at most types of complaints about the sale, administration, redemption and delivery of a funeral plan, where the complaint arose after 29 July 2022. For example, someone might get in touch because:
- they believe their plan was mis-sold as certain key terms weren’t clear during the sale, or some things aren’t covered under the plan
- they are unhappy with how the provider calculated the price of the plan, or they believe the price for the plan is too high
- they had administrative or service issues in relation to the plan – for example, how their provider dealt with cancellations or refunds
- they’re unhappy they had to make additional payments to cover services that are not part of their current plan
All of our members offer plans to UK customers, although some restrict their services to their specific regional areas of operation. In addition, some members operate overseas with operations for UK expatriates in various European countries. Full details of our individual members areas of operation can be found in the ‘Our Members’ section.