A pre-paid funeral plan protects you, and your family, against the rising basic cost of a funeral. The plan needs to work for you, financially, and it has to deliver on its promises for everyone who depend on the features or benefits included.
With that in mind, here’s a step-by-step guide to choosing a funeral plan – we hope you’ll find it useful, whether you choose a Safe Hands funeral plan or not.
What do you want included in the plan?
Are you looking for a funeral plan that will cover just the basic costs of a funeral director? Or would you like to pay for those costs plus the disbursements – the third party costs for a Minister or Celebrant, for example? This is a really important decision.
Some funeral plans exclude disbursements, keeping your up-front costs down, but whoever is arranging the funeral will still need to pay those fees at the time. Does the funeral plan provider offer bespoke options – can you pay for flowers, or a different coffin, or more transport for your family in advance? Most plans offer a ‘standard menu’ of the options you’d expect. Not all funeral plans will give you the option to tailor your funeral plan by making an up-front payment to cover ‘extra items’.
How do you want to pay for the funeral plan?
Most providers offer instalment plans, as well as one-off payments for a funeral plan. If you’d prefer to pay in instalments, you need to be sure it’s clear how long you’ll be paying for the plan, what the handling charges are (if any) and if you’re comfortable paying any interest on the unpaid balance. Some funeral plan providers don’t charge interest (we don’t).
TIP: Ask the funeral provider how it would handle an unfortunate situation, such as dying before a plan is fully paid up. What kind of contact would they make with your family or next of kin, to pay the outstanding amount? Can you see a letter or get an idea of how they’d handle the phone call?
What do you know about the funeral plan provider?
Whoever you choose – whether it’s a life insurance company , a funeral plan provider, or a funeral director – it’s a good idea to ask questions about the business behind the plan.
What would happen if the company stopped trading? Even large insurers have been known to sell their ‘book of business’ to other companies. How many complaints have they received – and how many compliments, about their service? How much experience do their staff have, in taking calls from a family that’s going through a difficult time? Most – but not all – funeral plan providers in the UK are members of the Funeral Planning Authority (FPA). We do encourage you to choose a provider that, like us, has signed up to follow the FPA’s code of practice.
How will the company invest your money?
In a nutshell, a funeral plan is a savings vehicle. It’s designed to ensure a sum of money will not only be protected, but also rise in value over time. A funeral plan provider should invest your money in a robust insurance policy or an independent trust fund. If it’s going into a trust fund, you might like to ask the provider to confirm that the money will be protected for the costs of your funeral, and that the trust will be administered by trustees who are independent of the plan-selling business.
What kind of documentation will you receive?
Everything connected to a funeral plan should be clear and easy to understand. They’ll be needed at a time when ‘making things a little easier’ is very important. Ask the provider, will their terms and conditions be easy to read? Will your family find it easy to understand who to call, and how the process will work? Will the paperwork explain what would happen if you changed your mind and wanted to cancel the plan? And if you change your mind, how long is the cooling off period – would you get a refund, or a partial refund at least?
How much control would you have over the funeral?
You might be looking at a funeral plan that’s provided by a local funeral director. But if you’re also thinking about a plan through one of the larger plan providers, it’s worth asking – who would provide the funeral services? What would happen if you move to a different part of the country, or overseas? And – if you’d like to nominate a particular funeral director, is that still possible? Can you work with an independent funeral organiser, someone who specialises in ‘something more personal’ than traditional funeral arrangements – or are you limited to a specific business?
As you can see, there’s a lot to think about. Make sure you ask questions – and have an opportunity to spend time going over the paperwork and following up with anything that comes to mind, later on.
Whatever you decide, we hope you’ll agree: end-of-life financial planning should be part of life’s everyday financial planning. If you’re not sure which provider will offer the service that’s right for you, it can be a good idea to talk it through with a financial adviser.