Please find our Frequently Asked Questions below.
What is a funeral plan?
A funeral plan is an arrangement that allows someone to pay in advance and plan theirs, or someone else's, funeral. Pre-paid funeral plans give someone the ability to choose and agree all their chosen arrangements for their funeral in advance before death so that their friends and family don't have the burden of paying for and planning it once the time comes.
It's a contractual arrangement with a chosen provider who is then responsible for arranging the funeral and paying for all of the elements covered by the plan. One of the most attractive elements of having a funeral plan is that it allows you to fix the cost of most elements of a funeral and it protects you from future inflation, as funeral costs are always rising.
Although some life assurance policies that provide a lump sum on death are sometimes called funeral plans, they are not the same for the following reasons:
  • The money paid out by these life assurance policies can be spent on other things, whereas the money paid for a funeral plan must be spent solely on a funeral
  • The money paid out may not be enough to cover the full expense of the funeral. Pre-paid funeral plans means that no one is going to be left in a difficult financial position
  • There isn't a contractual arrangement with a provider who is responsible for arranging the funeral. The contractual arrangement typical of a funeral plan is a comfort to many when the time does come around
What is a funeral plan provider?
A funeral plan provider is an organisation that allows customers to pay for their own or someone else's funeral in advance. Funeral plan providers come in the form of 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.
With funeral plans becoming ever more popular, there's a lot of funeral plan providers now available on the market. Be sure to do your research and make sure that you choose a funeral plan provider that is regulated by the Funeral Planning Authority, as this means that they have demonstrated that they comply with strict rules around how your money is handled.
What should I think about when buying a funeral plan?
At the top of the checklist should be that the plan is from a provider who is registered with the Funeral Planning Authority, as this means that they have demonstrated that they comply with strict rules around how your money is handled.
Secondly, think about what you think is important to be included within your plan. Do you want to choose your funeral director? Do you want your funeral plan to include a contribution towards minister's or doctor's fees? It is particularly important that you understand what allowance the plan makes to cover third party costs (such as crematorium costs).
Make sure that you check what the cancellation arrangements are for your chosen provider. It's unlikely, but you may want to terminate the contract later down the line. A lot of providers will charge a cancellation fee but these will vary.
It's not always easy, but discuss your funeral plan with your family and friends, explaining exactly what it is that you've purchased, who the plan is with and what it covers. This will put them in a much better position when the time comes for them to liaise with your chosen provider to confirm the funeral arrangements.
Does the money paid cover the entire cost of the funeral?
Although they will cover the majority, funeral plans don't usually cover every single expense of a funeral, so additional payments will likely be needed - although this does differ from plan to plan. There's certain third party costs - also known as disbursements - that may not be covered in full as they are not within the control of the funeral director. This could include things like newspaper notices and medical fees.
The most basic plans will cover a simple coffin and the funeral director's service, and you can pay more if you'd like your plan to cover extras. A more expensive package could for example include more funeral cars, a more decorative coffin and more third party cost allowances. It is also worth noting that plans do not normally cover the costs of a burial plot or interment fees.
How can I find an existing funeral plan?
You might be left in a position where you need to trace an existing funeral plan. Although there is no central database of funeral plans, the Funeral Planning Authorisation do have the facility to check whether their registered providers have a funeral plan in place for an individual. Details can be found here.
To search, you'll just need to complete some basic details about the person in question and then an email will be sent off to providers so that they can search for a potential match. If successful, you will be contacted directly. If unsuccessful, you won't hear back.
How will the funeral planning company know about my death?
Give someone the responsibility of informing the provider when the time comes. Make sure that at least one person is in the know about the plan; who the provider is and how to make the claim. Don't worry too much about providing them with specific documents as the provider will keep a copy of everything - but it might be a good idea to let them know where your copies are.
Don't keep the details of your funeral plan quiet - it'll be much less hassle for your loved ones if they can discuss it with you whilst you're still around to avoid any confusion. That being said, if your family aren't sure on the details but suspect that you had a plan, the FPA has a trace a funeral plan tool on their website that will be able to help them find out.
Should I pay in lump sums or instalments?
It's completely up to the individual and what suits them. If you can commit to the full amount of money up front then great. If not, instalments may be better as it spreads the cost. Financially, it is more beneficial to pay in a lump sum because with instalments, you're likely to pay an instalment charge.
It's worth considering that if you are paying in instalments, should your death occur before all instalments have been paid it'll be left up to your family to cover the rest of these costs. You can come across insurance back plans where no further instalments would be required to be paid in the event of death, however 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.
What happens after I have paid for my funeral plan?
After paying for a funeral plan, a 'nominated funeral director' is allocated and this will be the director who will be responsible for carrying out the funeral, unless something changes such as either the policy holder or the director moving house and changing locations - in which case a new funeral director will be allocated.
Upon your death, the funeral director will follow the terms of your funeral plan to put all the plans into motion. It's worth noting that you will have a cancellation period after paying for your funeral plan where you will be able to reclaim all the payments made. Once this period has passed, you can still cancel but you'll be charged a fee. Make sure you check this with your chosen provider.
What happens if I don't die for a number of years, and the cost of a funeral exceeds what I have paid for my plan?
Unfortunately, the cost of funerals is rising every year, which is a great reason to take out a funeral plan. The great thing about funeral plans is that they should provide protection against the inflation of the funeral directors costs - which can often be the most expensive part - so there's no need to worry about this specific cost. Third party costs (disbursements) generally increase with inflation though, and whilst some plans provide a contribution for these, they may not fully cover them.
Make sure you fully understand how this works in your plan and although it might not always be easy, make sure you explain it to your family so that they are also aware. You don't want them to be faced with any unexpected costs when the time comes.
What happens to the money I pay for a plan?
The money paid for a plan is not actually held by your provider. Instead, it is either used to purchase a whole of life insurance policy on the life of the planholder, or it is placed in a trust. This means that should anything go wrong with the provider such as them going out of business, your money would be separate and protected.
Once a claim needs to be made, the money that is paid out from either the trust or the insurance policy will be enough to pay for the majority of, if not all, of the funeral that your provider has committed to carry out for you. The FPA will regularly check with registered providers to confirm that this is the case, supported by actuarial assessments for trust based arrangements.
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