Prepaid Funeral Plan Questions

Yes. Anyone can purchase or take out a funeral plan for someone else, but we would always recommend that you buy a plan from a provider who is registered with the FPA. A list of providers that are registered with the FPA can be found here. When purchasing a plan for yourself or anyone else make sure you have read through the details of the plan, you’re satisfied with what it includes and excludes, and that you’ll get what you’re paying for. For more information about the questions that you should be asking when taking out a plan please see our guide which can be found here.

The FPA does not regulate funerals or deal with complaints about funerals. We suggest that you discuss any complaints about funerals with the relevant trade body for the funeral director involved. The two major trade bodies are The National Association of Funeral Directors (NAFD) and The National Society of Allied and Independent Funeral Directors (SAIF).

The FPA is a regulatory authority and can provide you with general information around funeral plans and the market. However, we cannot provide any advice on individual providers or around your own personal circumstances.

The FPA can be contacted as follows:

0345 601 9619 (Calls are inclusive in allowances from landlines and mobiles or otherwise charged at geographic rate)

Email: info@funeralplanningauthority.co.uk

Barham Court,
Teston,
Maidstone
ME18 5BZ

It is important to read the terms and conditions of the plan you are considering to verify what is covered. Frequently, third party costs, also known as disbursements, may not be covered in full as they are not within the control of a funeral director (e.g. medical fees, newspaper notices). If these costs are not covered, the plan may include an allowance for them. However, if at the time of death, these costs exceed the allowance, some additional payment may be required.  It is also worth noting that plans do not normally cover the costs of a burial plot or interment fees.

The FPA offers a facility to check whether our registered providers have a funeral plan in place for an individual. Further details can be found here.

Prepaid funeral plans allow you to choose and agree the arrangements for a funeral in advance. This can be your own funeral, or on behalf of someone else. Prepaid plans allow you to fix the cost of most elements of the funeral and protect you from future inflation of funeral related costs. Payment can be made either via a lump sum or instalments.

Discussions should take place between the person selling the plan and you as to how the plan will be paid for, cancellation terms and what is to be included in the plan, including any third party costs such as the cost of cremation. As the customer, you should always thoroughly read through the terms and conditions of the plan and only sign the agreement when you are 100% happy. It’s really important that you are clear about payment arrangements and how much you’ll be paying, so we encourage customers to ask as many questions as they need to at the point of purchase. Please read our guide on things to think about when buying a funeral plan here .

The rules around the regulation of funeral plans mean that the money required to provide the funeral is set aside in a whole of life policy or held in a trust. Either way these funds are kept separate from the provider company. A key part of the FPA’s compliance process is to check these arrangements are in place, which helps to ensure the money is available to provide the funeral when it is needed.

Depending on the operating model of the funeral plan provider they may carry out the funeral themselves if they, or their corporate group are funeral directors. If they are not funeral directors, they may engage one to carry out the plan. If they do this, the FPA expects them to agree the terms for carrying out the funeral as set out in the plan – and this will include how much the funeral directors are paid. They do this on your behalf as part of you buying the plan.

When the funeral is needed, the plan provider is responsible for arranging it and paying for everything covered in the plan, assuming everything has been paid for as outlined in the agreement.

If a plan provider is registered with the FPA then they should display the FPA logo on their website. You can also check on our website to see if the provider is FPA registered click here. You can, always call the provider to check and if you are still unsure then contact the FPA and we can check for you. You will find our contact details here.

We recommend that you discuss the plan you have purchased with your family or your executor. You should also make sure they know who the plan is with, as it is their responsibility to inform the funeral planning company (provider) in the event of your death. This can also be done via your nominated funeral director.

There is not a central database for funeral plans that have been taken out. However, the FPA does have a trace a plan tool on our website where you can fill in a simple form with the plan holder’s details and your contact details. This information will be forwarded to all FPA registered providers who will check to see if there is a plan in place. If a plan is held with one of our registered providers they will contact you within a few working days. If you do not hear back within this timescale then unfortunately a plan has not been found. If this is the case, it might then be worth checking with the small number of providers not registered with the FPA, insurance companies, local funeral directors and also checking back on historic bank accounts for payments out. To be directed to our trace a plan tool click here.

Some funeral directors are registered as plan providers themselves, but other funeral directors may sell plans on behalf of a funeral plan provider. When buying a plan from a funeral director it is important that you check who their plan provider is (if they’re not the plan provider themselves) and that the provider is registered with the FPA click here.

There are some price comparison sites, though we encourage customers to take great care that they are comparing like with like and not just compare on the headline price. As a simple example, different providers have different allowances in their plans for third party costs, which could materially distort a price comparison.

We also understand that some sites that claim to be price comparison sites are in fact introducer sites for individual plan providers and are not true comparison sites.

This is really a matter of choice and comes down to what best suits you. Clearly a lump sum involves a commitment of money up front, whereas instalments allow you to spread the cost. Most providers will add an instalment charge if instalments are spread over more than 12 months, so you should consider the financial impact of this.

You should also be aware that an instalment arrangement will normally require payment of outstanding instalments by your family if death occurs before all instalments have been paid.

There are insurance backed plans where no further payment would be required if death occurs before all instalments have been paid, though these usually have a period of up to 2 years where the value of the plan on death would be limited to a return of the contributions paid.

There are a small number of providers who are not registered with the FPA. This may be because they have chosen not to be registered or because they have as yet not passed the registration process.

Companies offering funeral plans are not legally required to be registered with the FPA, but all funeral plan providers have to comply with some basic rules. Being registered with the FPA means they have undergone additional scrutiny and must comply to a more stringent set of rules and requirements.

If you are considering buying a plan from a non FPA registered provider, it is recommended that you carry out your own checking process. The sort of questions we would suggest asking the non-registered provider are:

• Who are the trustees / or the insurance company and what is their relationship with the provider?
• What is the current solvency position of the trust fund?
• Who has assessed that position? (Basically there should be an actuary valuing the trust.)
• What are the assets of the fund and who is managing these assets?
• What are the arrangements for carrying out funerals and how are these reflected in the valuation of the trust’s liabilities? (If no arrangements are in place then assessing what the liability might be in a number of years’ time has significant challenges.)

In addition, it may also be worth checking for information about the firm registered at Companies House.

It is worth emphasising that FPA Registered providers choose to have their finances and procedures independently scrutinised by the Authority on annual basis, and further agree to operate within the terms of the Authority’s Code of Practice. Providers not registered with the Authority have elected for whatever reason not to submit their operations to such scrutiny.

A “nominated funeral director” is normally allocated, either at your specific request or by the funeral planning company. This will be the funeral director who will carry out the funeral, unless something else changes such as you moving home.

You will have a period of time in which you can cancel the contract and reclaim all monies paid. Once this period has elapsed, cancellation is still an option but a fee may be incurred. It is worth checking the details with your chosen provider so you know how long you have to cancel the contract without incurring a cost.

When death occurs, the nominated funeral director carries out the funeral according to the terms of the plan, and the trust or life insurance company pays the funeral director for doing so.

Third parties selling on behalf of registered providers should conform with FPA Rules and our Code of Practice where applicable, and registered providers working with them have responsibility to ensure that this is the case. The FPA check that providers have processes in place to carry out checks on providers they are working with and to monitor their behaviour.

If any customer has a complaint about a third party operating on behalf of a registered provider, they should complain to the provider and / or use our complaints form.

The funeral plan should provide protection against the inflation of the funeral directors costs and therefore your family should not incur additional costs for these specifically. However, the area where they could incur additional costs is third party costs (also known as disbursements), where some plans provide a contribution to these (that generally increases with inflation) but may not fully cover them. You should make sure you understand how this works in your plan and ideally explain it to your family.

FPA Registered Providers do not hold the money you have paid for your plan. Instead, they use it to either purchase a whole of life insurance policy on the life of the planholder, or to place the monies in a trust. The reasoning behind this separation is to ensure that if anything were to go wrong with the provider, the assets to pay for the funeral would be separated and ring-fenced.

The amounts to be paid out from either the trust or the insurance policy should be enough to pay for the funeral that the provider has committed to carry out for you reflecting the arrangements that have been made for the funeral. The FPA regularly check with registered providers to confirm this is the case, supported by actuarial assessments in the case of trust based arrangements.

A funeral plan provider is an organisation that allows customers to pay for their funeral in advance through provision of a funeral plan. These providers may be funeral directors, a subsidiary company of a funeral director, or a separate firm who make arrangements with funeral directors to carry out funerals on their behalf.

A funeral plan is an arrangement that allows a customer to pay in advance for theirs or another persons’ funeral.

The plan is a contractual arrangement with a provider, who assuming the plan has been paid for, is then responsible for arranging the funeral when it is required and paying for those elements covered by the plan.

Pre-paid funeral plans allow you to choose and agree the arrangements for the sort of funeral you wish to have in advance. They also allow you to fix the cost of most elements of the funeral, and protect you from future inflation of funeral related costs.

Some life assurance policies which provide a cash amount on death are sometimes called funeral plans. However, they are not, for a number of reasons.

Firstly, the money paid out can be spent on other things. Secondly, the money paid out may not be enough to cover the expense of a funeral. Finally, there isn’t a contractual arrangement with a provider who is responsible for arranging the funeral.

Find out more about the things you should think about when purchasing a funeral plan here

The FPA is there to add objective scrutiny to providers who chose to register with us. This scrutiny is intended to add a degree of basic consumer protection by ensuring that providers conform to the FPA Rules and a Code of Practice. This scrutiny is carried out by the FPA’s Independent Compliance Committee.

For the provider, being registered demonstrates they are operating above the basic required standards – which in turn provides an additional level of reassurance to customers purchasing a plan from them.

Firstly we would suggest you look for a plan from a provider who is registered with the FPA. This gives you an additional level of reassurance that the provider is compliant with a stringent set of rules and standards, which go above and beyond the basic requirements.

It is then important to think about what you want the plan to provide in terms of services. It is particularly important that you understand what allowance the plan makes to cover third party costs (such as crematorium costs).

A further factor to be considered for some people might be what happens if you move to another part of the country.

We also suggest confirming what the cancellation arrangements are, in the unlikely event that you wish to terminate the contract with your chosen provider.

It can feel like a sensitive subject to discuss your funeral with family and friends. However, if you do buy a funeral plan, we recommend you explain exactly what you have purchased with those close to you, and ensure they are clear on whom the plan is with, and what exactly it covers. This will help them to be better informed when they’re liaising with your plan provider to confirm your funeral arrangements at some point in the future.

If you’re thinking of buying a funeral plan, read our guide on the things you should think about here.

Anyone can set up a company to sell funeral plans, that is why it is so important to do your research before taking out a plan. Plans can be sold by the plan provider directly, or they can be sold via funeral directors or other third parties such as financial advisers. When buying a funeral plan always ask who the actual plan provider is and check to see if that provider is on the FPA’s list of registered providers click here. If you’re still not sure, you can contact us to double check click here.

Click here to view the list of all registered providers. Use the search facility if you have a provider in mind and you’d like to check their registration status.

Once you have chosen a provider, it can be helpful to visit their website, as many will include information which will help you do some initial research before you contact them directly.

The FPA deals with complaints about funeral plan providers registered with us. If you have a complaint that relates to your funeral director’s services then if the funeral director is a member of one of the funeral director trade bodies (National Association of Funeral Directors (NAFD) or The National Society of Allied and Independent Funeral Directors (SAIF)) you can contact them with your complaint. Their contact details can be found here . NAFD and SAIF.