funeral plans

Saving your family all the stress?

4 June 2024
Fran Hall
2 Comments
Categories: Dignity, funeral plans, Safe Hands Funeral Plans

We have long held a wary opinion of pre-paid funeral plans here at the GFG. 

Over the years, we have published numerous blog posts warning people to be extremely careful and to do as much research as possible before committing to purchasing a funeral plan. 

It’s an absolutely huge market. A multi-billion-pound market. According to Mintel, pre-arranged funerals account for a quarter of the overall UK funeral market, with 1.64 million funeral plans currently in existence. Let’s be generous and suggest that the average price of those plans is £2,000* – multiply that up and we reach more than £3,000,000,000 of hard-earned money tied up in funeral plans.

(*The price of a pre-paid funeral plan starts at just over £3,000. According to the National Association of Funeral Plan Providers, 169,846 new plans were purchased last year.)

The situation has improved significantly from the Wild West that it used to be before July 2022, when the Financial Conduct Authority (FCA) took on regulation of the funeral market. 

We wrote here about our relief when the FCA finally brought this multi-billion-pound market under scrutiny, giving the public the reassurance of knowing that planholders who have paid an authorised provider for a funeral plan will have the protection of access to the Financial Services Compensation Scheme and / or the Financial Ombudsman Service.

However, since the advent of regulation, multiple funeral planning companies have gone bust as a direct result of failing to meet the required FCA standards, leaving hundreds of thousands of devastated people who thought they had done the right thing by taking out a funeral plan, but who suddenly found that they don’t have the cover they have paid for.

Currently, four former funeral plan providers are in liquidation (Not For Profit Funeral Plans, Ready4Retirement, Rest Assured and Unique Funeral Plans).

A further six firms are in administration (Empathy UK Prepaid Funeral Plans, One Life Funeral Planning Ltd, Pride Planning, Prosperous Life, Safe Hands Funeral Plans and Silver Clouds Later Life Planning). 

And alongside these failures, the Serious Fraud Office are conducting a criminal investigation into a suspected fraud at Safe Hands Funeral Plans.

Plan-holders at many of the companies refused authorisation have often found themselves between a rock and a hard place – the choice for these unsuspecting, innocent planholders was either ‘just wait in line for whatever money back will be left to give back to you when the company is finally wound up’, or ‘accept the offer of a discounted new funeral plan from a FCA authorised provider’. 

A glance through the various Administrators’ Progress Reports or Liquidators’ Statements of Receipts and Payments at Companies House is depressing reading, as the labyrinthine dealings of investments, intercompany loans and transfers, and offshoring of funds is revealed. Vast amounts of money are now being allocated against the costs of winding up these companies, with Administrators’ fees running into millions already. The money paid in good faith, often by people who can least afford to lose it – many, many millions of pounds – has gone.

Across the board, Administrators are noting there will likely be just a few pence in the pound available to refund plan holders – see Page 10 of this example where the Administrator states ‘it is envisaged that Planholders who did not opt in to a Dignity funeral plan will receive a partial refund from the Trust. At present it is estimated at less than 10p/£ .’

After discussions with Administrators  / Liquidators, Dignity stepped in to offer rescue plans for clients of six companies, who together had purchased around a hundred thousand funeral plans. The transactional arrangements between Dignity and the Administrators for ‘rescuing’ these plans are not in the public domain.

Unsurprisingly, many of the worried planholders who were offered the alternative of transferring over to a new plan with Dignity took it, but all is not well here either. 

We have heard from a number of bereaved families of planholders who transferred over to Dignity in the hope of receiving the funeral they had paid for in good faith.

When the planholders died and their next of kin called Dignity to activate the plans, these families were told that the plan only covered 40% of the required money for the specified funeral. They were advised that they would have to pay the remaining 60% in order to have the funeral described in the original plan. We are unable to verify this information, but it has come to us from a number of reliable sources.

We are also very aware that many people who purchased their funeral plans from the now defunct companies would have expected their local (non-Dignity) funeral director to be carrying out the funeral. Obviously, where a plan has now been transferred to a Dignity Rescue Plan, this is no longer possible unless the Rescue Plan is cancelled and a new plan taken out, however there are problems here too. 

Planholders (or their bereaved families) who opt to cancel their new Rescue Plan are told: ‘You have a right to cancel your plan any time after we have received the funds from your previous funeral plan provider, without giving us any reason and without having to pay any cancellation fee.‘

So far, so good. But note the caveat ‘any time after we have received the funds from your previous funeral plan provider’. No indication of when this might be. And it goes on:

‘The amount you will receive will be in line with the terms and conditions enclosed in your welcome pack from us. The refunded sum shall be capped at the amount of money received by us in relation to the plan from your previous provider and any subsequent payments made directly from you to us.’

So, in plain English, that means around a hundred thousand people, having paid out something in the region of £200 million for their future funerals (many would have nominated their preferred funeral director who they wanted to carry out the funeral) have been faced with the alternative of either:

  • having the funeral provided by Dignity, with a significant additional payment required, and a penalty for cancelling which may decimate the expected value of the refund,

or 

  • waiting for the final winding up of the company they paid their money to, and seeing what miniscule amount will be repaid to them, with no funeral provision available.

Truly Hobson’s Choice.

As we have said all along, if you are thinking of buying a pre-paid funeral plan, be very, very careful indeed. 

~

Below is the current list of pre-paid funeral plan companies who are not authorised by the FCA. 

If you hold a funeral plan with any of these companies (and hundreds of thousands of people do) – and if you are unsure in any way of how you stand, go to the FCA website to get contact details to check on the status of your plan.

Bristol Memorial Woodlands FP Limited

Did not apply for FCA authorisation

Plans transferred to Plan with Grace Ltd

Capital Life

Application for FCA authorisation withdrawn

Plans transferred to Dignity Funeral Plans Ltd

Darwen Funeral Services

Did not apply for FCA authorisation

Plans transferred to Crystal Cremations Ltd.

Empathy UK Funeral Plans Ltd (Empathy)

Application for FCA authorisation withdrawn

In administration

Planholders were invited to take up Dignity transfer offer or offered a partial refund.

Eternal Peace Funeral Plans Ltd (Eternal Peace)

Application for FCA authorisation refused

Refunds provided to all Planholders

Fox Milton & Co. Ltd (Trading as Unique Funeral Plans)

Did not apply for FCA authorisation

In liquidation. 

No refunds available.

Geo. Hanson & Sons (Hucknall) Ltd (Geo. Hanson)

Application for FCA authorisation withdrawn

Plans transferred to Golden Leaves Limited.

Iberian Funeral Plans (based in Spain)

Did not apply for FCA authorisation

Planholders wishing to have a funeral in the UK have been contacted to provide a refund or offer other arrangements.

Mairi Urquhart & Son Ltd

Application for FCA authorisation withdrawn

Plans transferred to Crystal Cremations Limited

Maplebrook

Application for FCA authorisation withdrawn

Plans transferred to Golden Leaves Limited

Not for Profit Funeral Plans

Did not apply for FCA authorisation

In liquidation

One Life Funeral Planning Ltd.

Application for FCA authorisation refused

In administration

Planholders offered some discounted alternatives from other firms

Paul Young Funeral Director

Did not apply for FCA authorisation

Future of plans uncertain

Pride Planning

Application for FCA authorisation withdrawn

In administration

Planholders were invited to take up Dignity transfer offer or offered a partial refund.

Prosperous Life Limited (Prosperous Life)

Application for FCA authorisation withdrawn

In administration

Planholders were invited to take up Dignity transfer offer or offered a partial refund.

PS Cremations Funeral Planning Limited

Did not apply for FCA authorisation

Company still registered at Companies House

Ready4Retirement

Application for FCA authorisation withdrawn

In liquidation

Most plans transferred to Low Cost Funeral Ltd on same terms. Remaining Planholders offered new, discounted plans by Low Cost Funeral Ltd.

Rest Assured Funeral Plans Limited (Rest Assured)

Application for FCA authorisation withdrawn

In liquidation

Planholders were invited to take up Dignity transfer offer or offered a partial refund.

Safe Hands Funeral Plans Limited

In administration

Under investigation by the Serious Fraud Office

Planholders offered new discounted plans by Dignity Funerals and Co-op Funeralcare

Silver Clouds Later Life Planning

Application for FCA authorisation withdrawn

In administration

Planholders were invited to take up Dignity transfer offer or offered a partial refund

SJP Lichfield

Application for FCA authorisation withdrawn

Plans transferred to Golden Leaves Limited

Sovereign Lifecare Ltd

Did not apply for FCA authorisation

No information on plans

Tyde Group Limited

Did not apply for FCA authorisation

No information on plans

Wren & Fraser

Application for FCA authorisation withdrawn

No information on plans

Funeral plans – a bonfire of vanities

4 August 2022
Fran Hall
1 Comment
Categories: funeral plans

If you or a member of your family have taken out a pre-paid funeral plan, read on. Important information below!

 

On Friday last week, the crowded funeral plan landscape suddenly became a little less bustling. Quite a lot less, actually.

 

On 29th July 2022, the  Financial Conduct Authority took on the regulation of the funeral plan market, and with immediate effect, almost two thirds of funeral plan providers have been refused permission to sell new plans, leaving just 26 funeral plan providers that will be authorised by the FCA.

 

There were, until 29th July, around 70 companies selling funeral plans in the UK. Some large, with enormous amounts of money invested, some small. All were required to apply to the Financial Conduct Authority (FCA) for authorisation after the government legislated in January 2021 to bring pre-paid funeral plans into FCA regulation.

 

The market had been, until last week, completely unregulated, and over the years there have been various high-profile collapses of funeral plan providers, leaving customers who thought that their funerals were organised and paid for in the distressing position of finding out their money had been lost, and that there was absolutely no redress. 

The most recent company to go into liquidation is Unique Funeral Plans, which announced on 22nd July that its 3,000 customers would not receive refunds, nor would their funeral plans be transferred to alternative providers. The previous week, on 14th July, Not for Profit Funeral Plans Ltd was placed into liquidation with all funeral plans terminated with immediate effect.

This came just weeks after approximately 45,000 people who had purchased a funeral plan from Safe Hands Funeral Plans were told they could expect to receive back just 10% of the plan value by administrators, after that company collapsed into administration in March. 

Temporarily, Dignity Funerals Ltd has agreed to fulfil all funerals of Safe Hands funeral plan holders for six months from 11th May 2022, and they are contacting all plan holders offering (for additional contributions) a replacement funeral plan from Dignity, see details here.

Curiously, at the same time, Dignity have paused their sale of funeral plans, quite a decision for a company that usually sells around 1,000 plans a week!!

Anyway, we digress. 

13 further plan providers that applied for FCA authorisation have not been authorised. These companies are permitted to continue administering existing funeral plans until 31st October, but they are prohibited from selling any new plans. By 31st October, they must transfer their plans to authorised firms or refund their customers. They are permitted to continue receiving instalment payments, if you already have a plan with them, and they should be contacting you to let you know what’s happening. Make sure you respond to any communication you receive where required. 

Plans offered by these 13 companies are not covered by FCA regulation, meaning there is no protection by the Financial Ombudsman Service (FOS) and the Financial Services Compensation Scheme (FSCS) until they are transferred to authorised providers.

You can see the full FCA list here, showing the 26 companies that the FCA is authorising, the 13 companies that are permitted to continue administering plans and a non-exhaustive list of 10 companies that must not sell or administer plans. 

It is estimated that there are almost two million people in the UK who have taken out a funeral plan to cover the costs of their funeral, and 87% of this market (around 1.6 million plans) are provided by the 26 providers now authorised by the FCA, meaning that customers will now have access to the Financial Services Compensation Scheme, so their money is protected if their provider fails. 

Planholders with authorised companies can also make a complaint to the Financial Ombudsman Service even if the issue they are complaining about happened before July 2022 if the firm was registered with the Funeral Planning Authority (FPA) at the time the issue occurred.

The FCA will monitor adherence to the new regulations that have come into force, which include:

  • A ban on cold calling.
  • A ban on commission payments to intermediaries, such as funeral directors.
  • A requirement for a funeral plan to deliver a funeral unless the customer dies within two years of taking out the plan, in which case a full refund will be offered.

Finally, it seems, purchasers of pre-paid funeral plans can have confidence that their chosen provider is both reputable and reliable, and that their money will be safe.

Here at the GFG we have a pretty jaded view of the entire principle of encouraging people to decide and pay for their funerals in advance, and we’ve written extensively about our misgivings. 

We have argued that advance payment ‘for peace of mind’, as it’s advertised, is actually entering into an expensive transaction that often leaves bereaved families without choice or control of an event that is supposed to be for them, not for the person who has died. Read this blog post from 2019 which shows just how unsatisfactory – and financially unbeneficial – a funeral plan can be.

We understand that many people worry about the costs of funerals, and that, for some, paying for their funeral arrangements in advance is an attractive prospect, particularly with the escalation in funeral costs that continue relentlessly year on year. Securing funeral services at today’s price seems both sensible and responsible, particularly for the prudent generation reaching their 80’s and 90’s, something that has not gone unnoticed by the marketing teams of funeral planning companies.

Until now, people purchasing pre-paid funeral plans have had to hope that their chosen plan provider was a secure and responsible entity, and that the ‘stress and worry of planning a funeral’ was all taken care of with the stroke of a pen on their cheque as they sent the forms back in the pre-paid envelope helpfully provided. There was, though, no guarantee of this.

Finally, with the oversight of the FCA now in place, people who want to settle their funeral arrangements in advance will be able to have confidence that their money is safe and that their decisions about their funeral will be carried out as they wish. 

This FCA safety net has been needed for a very long time, and we are relieved that it is now in place.

On the subject of funeral plans – your thoughts are invited

4 March 2019
Fran Hall
2 Comments
Categories: funeral plans, The future of funerals

Like everyone else who responded to the Competition and Markets Authority’s consultation on whether to make a market investigation reference for the funeral market, we received an e-mail last week. The e-mail invited us to share our views on whether the said MIR should also cover the delivery of funeral services obtained via a pre-paid funeral plan.

And like everyone else concerned with the state of the current funeral market, we will be submitting our considered opinion on this matter. Which is that yes, there absolutely should be further scrutiny of the funeral sector with regard to the provision of funeral services arising from redemption of pre-paid funeral plans.

This blog has covered the subject of funeral plans on no less than 47 occasions over the years. And our opinion hasn’t changed. On the whole, and with the exception of the Good Funeral Guide Pre-Paid Funeral Plan (which isn’t like any other funeral plan we’ve come across) – we have little time for funeral plans.

We make no apology for again repeating the quote from Thomas Long in his and Thomas Lynch’s ‘The Good Funeral – Death, Grief and the Community of Care’ because it sums up pretty much what we think:

“The ‘buy now, die later’ brand of package deal has meant a lost connection between the sale of funerals and the delivery of them, and with it the loss of face-to-face accountability between buyer and seller that used to provide reliable consumer protection. Now the recipient of the services (the bereaved) and the provider of same (the funeral director) are both perilously out of the loop of the original transaction: a deal often brokered years before, between a commissioned salesperson and the now newly deceased. In such an environment there can be little real accountability.”

Notwithstanding this lost connection between the parties concerned with the funeral, in their consultation on scope of the proposed market investigation, the CMA notes the following:

‘In some respects, the position of the purchaser of a funeral plan from a plan provider may be similar to the purchaser of funeral services at need from a funeral director. In both cases, a lack of clear and comprehensive information about price, range and quality, combined with likely inexperience (as purchasing funeral plans or arranging funerals are generally infrequent purchases) mean that the customer is likely to lack the ability to assess properly the value for money of all the options offered.’

Definitely worth a closer look then.

The CMA’s invitation to offer a viewpoint isn’t restricted to just those who responded to their previous consultation, so if you have an opinion on whether the CMA should be looking at the services provided in ‘redemption of pre-paid funeral plans’, please drop them a line. You have around nine days in which to do so.

Postal address: Funerals market study team, Competition and Markets Authority, Victoria House, 37 Southampton Row, London WC1B 4AD

Email address:  funerals@cma.gov.uk

Here’s the content of the e-mail:

“In November 2018, the CMA consulted on its proposal to make a market investigation reference in relation to the supply of services by funeral directors at the point of need and the supply of crematoria services (in both cases within the UK). The draft terms of reference excluded from the meaning of ‘services by funeral directors at the point of need’ both the provision of pre-paid funeral plans and the provision of services provided pursuant to prepaid funeral plans.  

The CMA has received representations, in response to this consultation, that the scope of the proposed market investigation reference should be extended to include the funeral services supplied by funeral directors in the United Kingdom arising from the redemption of pre-paid funeral plans.

The CMA is, therefore, inviting interested parties to provide views on whether, if the CMA decides to make a market investigation reference, the scope of the market investigation should include the delivery of such services. 

The consultation document can be accessed on the Funeral market study case page at: https://www.gov.uk/cma-cases/funerals-market-study

Comments should be provided to the CMA no later than 5pm 13 March 2019.

Those pesky funeral plans…

5 February 2019
Fran Hall
6 Comments
Categories: funeral plans

Here’s a salutary tale for anyone who is seduced into buying a funeral plan in order to ‘get on with enjoying life’, or ‘protect your family from future costs and worry’ or to avail themselves of the ‘peace of mind that your funeral costs and arrangements have been taken care of’, or whatever the latest snake oil sales pitch currently in use promises..

Back in 2007, a person who wishes to remain anonymous (but who has given us permission to publish this information) decided to do the responsible thing and organise their funeral in advance.

She purchased a funeral plan from Royal London, that UK’s ‘largest mutual life, pensions and investment company’. 

She paid £3,304.53 by instalment payments for what she thought was the cost of her own future funeral. And she thought no more about it until 11 years later when she had to arrange a funeral for her best friend. 

This funeral was carried out by a small, independent funeral director, and the holder of the Royal London funeral plan was so impressed that she went back to the small, independent funeral director to ask if they would be able to carry out her own future funeral – the one she’d paid for by buying a funeral plan. She thought it was called a Dignity plan, and her understanding was that she could decide which funeral director could be used.

The small, independent funeral director spent almost two hours with her trying to work out the current value and situation of the funeral plan, including a phone call to the plan provider that lasted over an hour. The plan provider of the funeral – that had been bought from Royal London -turned out to be Dignity Funeral Plans. 

It transpired that the plan purchased in 2007 for £3,304.53 was now valued at £3,488.25. This total included £827.92 towards third party costs, i.e. the cremation fee, the doctors’ fees and the cost of a minister or officiant. 

So over 11 years, the value of the funeral plan she had bought had gone up by just £183.72. It seemed that interest was only accrued on £640 of the money she’d paid – the money allocated towards the third party costs. The remaining £2664.53 hadn’t attracted any interest at all.

Now, the person who had bought this plan wasn’t very happy with this, and nor was she happy with the fact that her funeral would be carried out by a branch of Dignity Funerals when she wanted it to be carried out by the small, independent funeral director. She particularly wasn’t happy with the way the person on the other end of the phone was speaking, and she wanted to cancel the plan there and then.

The small, independent funeral director said that she ought to go away and think it through. They said they would write to her to set out her options so that she was really sure that was what she wanted. The holder of the plan agreed, and arranged to come back in a couple of weeks once she’d had a chance to read the information that the small, independent funeral director had put together for her about the costs of cancelling and the alternative choices she would have.

A few weeks later, and even more determined to cancel, the holder of the plan went back to see the small, independent funeral director and confirmed she definitely wanted to cancel the plan. Because she had been so unhappy with the way the previous phone call to the funeral plan company had gone, she decided to record the phone conversation, which was on loudspeaker in the office of the small, independent funeral director.

Below is the transcript of the 15 minute phone call that took place. 

Bear in mind, this is a call to a branch of the UK’s self-proclaimed ‘Leader in Funeral-Related Services.

This is how they describe themselves:

 ‘Our funeral directors date back to 1812 and last year we conducted 68,800 funerals, with 99% of families we served saying we met or exceeded their expectations. As a financially stable company, with a long reliable history, we have the stature and capability to stand behind the guarantees made to every Planholder. Funerals are all we do, so you’ll be in experienced hands from the moment you take out a funeral plan to the moment your loved ones need to talk to one of Dignity’s 1,200 owned and approved funeral directors’.

Oh, and just to explain the confusion our plan holder had –  if you look at the Dignity Funeral Plans website FAQs, this is what you’ll find:

‘All Prepaid Funeral Plans from Dignity guarantee to cover the cost of the Funeral Director services and the third party cremation costs specified – these are cremation fees and Minister’s or Officiants’ fees. Some other providers only provide a contribution towards the cremation costs.’

Dialing tone

“Good afternoon, you’re through to ‘Person 1’ at Dignity Funeral Plans, how can I help you today?”

“Hi, can you put me through to somebody that I can speak to to cancel my plan please?’

“OK, I can certainly help you with that today. Is it possible to take – have you got your plan number to hand at all?”

“Yeah, it’s XXXXXXXXXXXX”

“Thank you. Is it possible to take your name please?”

“Yep, it’s XXXXXXXXXXXX”

“Thank you. OK, so, what I’m going to do, I’m going to pop you through to one of my colleagues who’ll be able to help you today.”

“Yes, that’s fine”.

“OK, so I’ll pop you on hold, I’ll be as quick as possible for you then.”

“Brilliant, thank you.”

45 seconds of music……… 

“Hi, thanks for holding, I’m just going to pass you over to my colleague ‘Person 2’ now who’ll be able to look at this for you, OK?”

“That’s great, thank you.”

“Thank you, take care.”

“Hello, is that Miss XXXX?”

“It is.”

“Hi Miss XXX, my name’s ‘Person 2’, my colleague ‘Person 1’ has advised me that you wish to cancel your Royal London Funeral Benefit Plan, is that correct?

“Yes”.

“OK. Um. He transferred you over to me because I’m the only person available in the erm, the customer service centre. It’s not actually cancellations, so we would need to arrange a call back for you, erm, to actually process the cancellation, would that be ok?”

“No, not particularly, I really want to get this done today please.”

“It will be done today. That call back will be today. We usually have to allow for a two hour turn around so it would be quarter to three.”

“No, I really do need to get this done as soon as possible because I want to get something else sorted out. I’ve already got an appointment with a different pre-payment company this afternoon.”

“Right, ok, bear with me, let me just place you on hold”

“Thank you.”

2 minutes 26 seconds of music

“Hi, Miss XXXX”

“Hello”

“I’m just going to transfer you over to my colleague ‘Person 3’ who is on cancellations.”

“That’s great, thank you”

“She should be able to do that for you ok?”

“That’s brilliant, thank you.”

“Hello, is that Miss XXX?”

“It is, yes.”

“Hello Miss XXX, you’ve been transferred over to ‘Person 3’ in the cancellation team. I believe that you’re wanting to cancel your funeral plan, is that correct?”

“Yes that’s right.”

“OK, can I ask, is there any main reason that you’ve decided to cancel at all, is there anything that we can offer to do for you?

“Well, I spoke to somebody last week, um, to try and find out how much interest the plan’s actually accrued, and just to make sure that my funeral was covered – he was just awful, insisted on speaking over me the whole time, couldn’t actually get a clear answer out of him, and then over the weekend the Competition and Markets Authority report’s come out and that’s just sealed the deal for me so I want to cancel.”

“Right, okay, I mean, I’m happy to answer your questions if you’d like me to go through that with you at all?”

“No, it really is fine, I’ve come to the point where I just want to cancel everything please.”

“That’s absolutely fine, you’re well within your rights to cancel. In order for me to do that over the phone I just need to complete a few additional checks with you.”

“Yep”

“It’s just a couple of questions relating to the original set up of the plan if I may.”

“Mm Hmm.”

“So, could I kindly ask you, when you took out the plan, how it was taken out, so was it done over the phone, was it done via a website do you recall?”

“It was with, well, it was by phone but it was through Royal London.”

“It was.”

“Yeah.”

“And there was some different options of plan type I believe at the time, so there was the Standard Plan, the Classic Plan and the Prestige Plan – do you call what plan type you opted for?”

“Yeah, the Classic Plan.”

“Thank you. And do you recall lastly how you was making payments?”

“Yeah I paid by instalments.”

“Yep, was that direct debit or was that by card? Do you know?”

“Direct debit.”

‘OK, thank you. So that’s all the additional checks that I need to be able to start the process to cancellation, so just to confirm with you what will happen now is I will proceed with the cancellation of the plan, it will be completed within 14 days, any money that you paid into the plan will be refunded, it is subject to a cancellation fee however of £395, everything else you will get back.”

“Right. So, that will leave me with exactly how much?”

“Yup, I can tell that, bear with me.”

“OK, so the refund will be for £2909.53.”

“Right, so in eleven years then, I’ve made £187, you’re going to keep my £187, charge me another £400 to cancel it. Is that basically the gist?”

“Right, so the policies are not – they don’t incur interest, um so..”

“I’m sorry, no, sorry, hang on a minute. So, I’ve taken out a pre-payment plan. And I don’t get interest.”

“No. It’s a product that you’re actually buying. You’re actually securing the services within the plan, that is what you’re guaranteeing, so you took out this plan in 2007, and what you’re doing is, regardless of when that plan comes to be used, you’re guaranteeing the services within the plan so it’s holding the services, the value of the services, so it’s obviously guaranteeing to cover the funeral director’s fees and their staff, it covers the hearse plus one limousine, so everything that’s in your schedule of cover that is what you’re guaranteeing to be covered at the time of need.”

“Oh that’s awesome then, so that means that if I decided to keep this plan then there is not another penny that my family would need to pay if I died tomorrow.”

“There absolutely – once it’s fully paid for you’re guaranteeing to cover your services within the plan.”

“Right, so there’s – hang on, look, I just want to get this straight in my head, ‘cause that’s not what somebody else told me, so you’re telling me that if I keep this plan, if I die tomorrow there is not one penny that my family would have to pay for me to get everything that’s on that plan.”

“No, so  everything that’s on that plan you will – you’re –it’s guaranteed to be covered”

“So Oxford Crematorium is £1070, you’re guaranteeing to pay that are you?”

“Let’s have a look. So yours is a contribution plan towards the crematorium fees, so let’s have a look and see what that is worth, because obviously that’s within the plan, those are called disbursement charges.”

“Yep”.

“So there was £600 when you took this out when you took this out – erm, when you took this out..”

“Was it £600? It was actually £640, but – ok.”

“So that is risen in value because obviously that increases with inflation so that is now worth £827.92. So if you, like you said, were to sadly pass away tomorrow, that money your children would have to put towards the crematoria part.”

“So it’s not completely guaranteed then is it?”

“It’s guaranteed to cover everything that’s listed within the plan, so what – the guarantees, in full are to cover the funeral director fees and their staff, that includes the coffin, the hearse and one limousine, for you to be brought into care of the funeral directors so those are your guarantees within the plan so regardless of when that comes of use , those will be covered by the plan, now you’ve got a  – you’ve a third party towards contributions with the money that – what I’ve just advised you of there so that money rises each year in line with inflation, that money is then put towards the crematoria costs, so the only things that are not – that come outside of the plan are things like – other things like flowers, if your family wanted an obituary notice, order of service isn’t covered, so those sort of things are separate that fall outside of the plan cover, but the things that I’ve mentioned are fully guaranteed, regardless of when it comes to be used whether that’s tomorrow or ten years.”

“So the crematorium and the doctors’ fees are completely covered as of today, so if I died tomorrow, if there’s a shortfall between what you’ve said I’ve got which is what £827.92 and what the crematorium and doctors’ fees are, that’s covered? I don’t have to worry? My family doesn’t have to worry?”

“Yes, so the contribution towards the crematoria fees, so at the moment it is worth eight hundred and whatever – let me just..”

“Yeah, eight hundred and twenty seven ninety two, so that’s covered, but you keep saying that everything’s guaranteed but it’s not, because if Oxford Crematorium is a hundred and – sorry, one thousand and seventy pounds now, my eight hundred and twenty seven pounds isn’t going to cover that is it, so my family – would my family have to cover that or do you?”

“But that rises each year in line with inflation.”

“Yes but if there’s – if I’ve only got eight hundred and twenty seven pounds in there, and Oxford Crematorium is one thousand and seventy pounds – that’s in eleven years I’ve accrued a hundred and eighty seven pounds, so I can’t imagine the costs are going to be even close to sort of being the same are they, as time goes on? So, all I’m asking, all I want is an answer, will my family have to pay the difference between what it actually costs and what I’ve managed to accrue in interest for the disbursements? Will they get a bill? That’s all I need to know.”

“They will, yes.”

“Right, in which case I’d like to cancel the plan please.”

“That’s absolutely fine.”

“Cool.”

“Give me one moment. I’ve gone through the additional checks with you. Now as – we do legally have to refund the same way that payment was taken so I just need to confirm your bank details with you just to make sure that they still match with what we hold, to make sure that we will be refunding the correct account, would you confirm the name of your bank for me?”

“It’s XXXXX”

“Thank you. And could you kindly confirm the sort code and account number for me.”

“Yeah it’s XXXXXXX and the account number is XXXXXXXX”

“Wonderful. So that still matches with what we hold. So the refund will be applied to that bank account within 14 days. On completion of the cancellation Miss XX we’ll also send you confirmation in the post so you will get a letter to confirm everything that I’ve discussed with you and that the plan is fully cancelled down. Is there anything else that I can assist you with at all?”

“No, that’s it, thank you, you’ve been really helpful.”

“Oh you’re most welcome, well thank you very much for your time Miss XXX. I hope you enjoy the rest of your day.”

“Thank you.”

“You’re welcome, bye.”

We’d like just a few minutes of your time…

7 June 2018
Fran Hall
3 Comments
Categories: funeral, funeral plans

Dear reader

We’d like to ask for a few minutes of your time to respond to two important funeral related consultations.

The first is the Funeral Market Study by the Competition and Markets Authority. This forms part of a year long study into the state of the British funeral market which will examine how competition between funeral directors works and transparency issues in the provision of funerals, and will also look at competition in the crematoria segment of the industry.

For anyone who has an opinion on transparency of ownership or pricing of funerals, it is important that your voice is added to the responses that will be received. You can download the CMA Statement of Scope here. Responses are requested by June 28th 2018.

The second, parallel consultation is the Government’s Call for Evidence to aid in the design for a more appropriate regulatory framework for the pre-paid funeral plan sector. The government is particularly interested in views from all affected stakeholders, including funeral plan providers, funeral directors, insurers, asset managers, introducers, actuaries, solicitors, and consumer interest groups. The consultation document can be downloaded here. The consultation closes on August 1st 2018.

We’ve waited a long time for the government to show some interest in the funeral industry, so let’s make sure that the voices that are heard are telling them what is actually happening.

Team GFG

There’s an unpleasant odour emanating from somewhere..

16 February 2017
Fran Hall
11 Comments
Categories: Arranging a funeral, Bastards, funeral cost, funeral plans

Back in 2015, we reported on this blog about the legal skirmish between funeral plan providers Safe Hands Funeral Plans and Golden Charter – see here to refresh your memory.

A paragraph from that blog post came to mind today:

‘While the lawyers order trebles all round and get ready to enwrap both parties in litigation for as long as legally possible, the good citizens of Funeralworld tremble. A lot of heavily soiled linen looks like being washed in public. God forbid that the public learn just how much of the money they spend on a funeral plan gets divvied up among sundry predators in the form of commissions, sales and marketing costs, directors’ wages, you name it.’

Well, thanks to the wonderful world of t’internet, that very information is now available in an easy to read table, showing just how much money is taken out of the total cost of a funeral plan in non-funeral related fees. Thanks to John Taplin from Open Pre-Paid Funerals Ltd for providing this link.

Have a look here.

Or, for a quick précis, we’ll summarise a couple of the lesser known facts listed in the table for you.

  • The main providers of UK pre-paid funeral plans, namely Dignity, Golden Charter*, Golden Leaves, Avalon and Safe Hands will extract between £785.00 and £1,500.00 in ‘admin fees’ from the total amount you pay them. (Co-operative Funeralcare don’t publish the amount they charge). Editor’s note: *We have been reliably informed that where Golden Charter plans are purchased directly from a funeral director, the administration fee is much lower and the only deduction from the money you pay is £249.00.
  • If you buy a plan provided by one of those five companies from an agent working on their behalf (this could be a solicitor, a will writer, a financial advisor, a funeral director etc) then a commission payment of up to a figure between £500 and £600 is paid to them. (Co-operative Funeralcare don’t use agents, their plans are only available directly, or from their branches).
  • The money set aside within the plans provided by those five companies to cover the third party costs (crematorium fee, doctors’ fees and officiant’s fee or a contribution towards burial costs) ranges between £940 and £1,200. Co-operative Funeralcare don’t specify the amount set aside towards disbursements in their plans.
  • The value of the growth per annum of each plan is not published by any of the six plan providers listed above.
  • The growth of value of the amount set aside for third party costs for each plan is that of the Retail Price Index for five of the plan providers. Golden Leaves use the Consumer Price Index.

So, it is entirely possible that the money you pay in good faith for a funeral plan, thinking that you’re addressing the ever more hysterical annual announcements of the rising costs of funerals escalating beyond comprehension yet again, will in fact be whittled down to the bare bone when death occurs and the funeral needs to be arranged. A pocketful of cash here, a handful of cash there, all disappearing from that plan price in the direction of administration and commission before the ink is even dry on the medical certificate of the cause of death.

As an example, we were told this week about a funeral director receiving a call from one of the funeral plan providers listed above. The plan provider invited the funeral director to carry out a funeral for a plan holder who had just died. The plan holder had paid £3,595 for their funeral. It included all the traditional aspects of a funeral, collecting and caring for the person who had died, providing a coffin, dressing them and providing chapel visits, all professional assistance with the funeral, providing a hearse and a limousine and the third party costs.

So far so what, you might think. £3,595.00 sounds about ok for what is being provided?

Well, the amount that the funeral director was offered for undertaking this funeral was actually £2,445.00.

And, of that £2,445.00, £1,100.00 was allocated for the third party costs. In fact, the third party costs totalled just under £1,200.00.

So the funeral director, the one actually doing the funeral, was effectively invited to do so for £1,245.00.

That’s just £145 more than the £1,100.00 that had whistled out of the original payment to persons unknown in administration fees and commission payments.

The funeral director concerned politely declined the offer. They couldn’t make the sums add up.

The person who paid £3,595.00 for their plan and who died thinking their funeral was all sorted is none the wiser. Their family is probably none the wiser. The plan provider may have found a funeral director willing to carry out this funeral for £1,245.00 and nobody will be any the wiser.

We think it stinks.

There is a whole can of worms writhing underneath the label of ‘Funeral Plans’. Thousands are sold each year to unwitting purchasers who are seduced by lines such as ‘We Believe Your Loved Ones Shouldn’t Be Left With Any Surprise Bills’ (capital letters not our own), or ‘A pre-paid funeral plan from the UK’s largest provider ensures peace of mind for you and your family’. There’s a very nice living to be made from selling funeral plans offered by the big six providers, but not such a good one from carrying out the actual funerals involved.

If you are thinking about planning your funeral in advance, do your homework. The only plan provider that we rate is Open Pre-Paid Funerals Ltd. So highly do we rate them, we have developed our own, unique alternative to funeral plans in partnership with them. It stands apart from every other offering on the market.

It’s the GFGPlan.

GFGPlan puts your interests first. There is an administrative fee of £195.00. That’s it.  Other than that, there are no deductions whatever from the money placed in the GFG Plan pot. Zilch. Not one penny is spent on salaries, nobody gets a commission, and there are no free pens.

Read about it here.

Burgundy stays Burgundy, Lilac becomes Turquoise

15 June 2016
Fran Hall
2 Comments
Categories: Co-op, Co-operative Funeralcare, Dignity, funeral cost, funeral plans

The Telegraph & Dignity

In Burgundy coloured news 

The Telegraph has been hard at work this month, convincing us that the funeral situation in the UK really is dire.

On the 10th June, we heard about a grieving gentlemen in New Milton, Hants, who is digging a grave in his back garden to bury his 101 year old mother, unwilling to pay ‘the outrageous cost of a funeral’.  According to the article, the resourceful John Wright is even considering purchasing a large fridge to avoid the cost of keeping his mother in the local mortuary.

The article claims that a local funeral director (as yet unnamed) quoted £2500 just to take Mr Wright’s mother’s body to the church in a hearse.

Anyone concerned about this sorry state of affairs and wondering whether they’ll also need to find the space for a large fridge in their garage, need not have worried.  The Telegraph had it all in hand.

On the 13th June, another article appeared in The Telegraph, this time comparing funeral costs and an analysis of available life insurance policies and funeral plans, suggesting that nothing on the market truly covers the cost of a funeral.

Both articles ended with an endorsement for The Telegraph’s own funeral plan, in partnership with the burgundy coloured funeral group, Dignity PLC.  As well as a generous £50 discount for all Telegraph readers and a link to a glossy sales website with further hysteria about the cost of funerals and how it’s only going to get worse.  Much much worse.

How about an unbiased report into funeral costs, not funded by anyone with a financial interest in selling funeral plans?   Or non-hysterical media coverage of the cost of a funeral with no sales agenda?  Or a realistic review of the many viable affordable alternatives that aren’t package deals out there?

Anyone out there? Anywhere?

Cooperative Funeralcare
The once lilac Cooperative Funeralcare has undergone a rebrand and become turquoise

In lilac coloured news

Following the sale of its five crematoria to our burgundy coloured acquaintances Dignity Plc for £43m, the lilac coloured Co-Op freed up lots of cash to spend on a comprehensive rebrand of its businesses, also promising to invest in improving funeral parlours under its Funeralcare brand.

The group has already returned to its classic clover-leaf logo, which first appeared in the late 1960s.  The aim was to be reassuringly retro, harping back to the good old days of shops, produce and dividend stamps, before the days of controversial CEOs with massive pay packages sullied the Co-Op name.

As part of the rebrand, the shade of lilac that characterised Co-Op’s British High Street funeral chain, Funeralcare, is no more, replaced by a calmly reassuring turquoise.  Personally I was hoping for a garish shade of parakeet green, not dissimilar to the Queen’s birthday outfit.

The updated Funeralcare website is already live and rumour has it that the first funeral home to be refurbished with the new branding has been completed in Scotland.   We don’t yet know whether funeral directors will be issued with turquoise cravats, but we’d very much like to find out.

Whether the re-brand is anything other than a lick of paint and a wardrobe change remains to be seen.  In the meantime, turquoise is the new lilac is the new black.

Help yourself to some of this

8 April 2016
Charles
4 Comments
Categories: funeral cost, funeral plans, pre-need plans

When John Taplin of Open Prepaid Funeral Plans first proposed that we work together to create a GFG funeral plan I told him to f*** off.

Not in so many words. I was icily polite. I was practised in the art having previously spurned the seductive sweet talk of another funeral plan pedlar which wanted to fly me to Scotland and show me how shiningly ethical it is. In their case I explained (courteously) that I failed to see how it could be a good deal for the consumer to lavish hospitality and double-jointed accountancy on an innumerate dingbat like me.

John persisted. What did we want a funeral plan to look like? I fired impossible specifications at him and hissed “See what I mean? Can’t be done, cannit?”

And he replied, “Oh I think it can.”

So (finally) we met and the rest is, as they say, the present and the future. We showed our freshly-minted prepaid plan to a fifth-generation funeral director of impeccable credentials and all the risk aversion you could ask for. He mulled and he mused and finally he spoke: “With this plan I get to charge every funeral at the full at-need price.” I’d been blind to that because John and I had focussed exclusively on the interests of the consumer. But you can see why our heritage FD liked what he saw when you consider this from Golden Charter’s Ts and Cs:

“Upon completion of the Beneficiary’s funeral arrangements the Selected Funeral Director will be entitled to payment from us … The Selected Funeral Director will have no recourse against us or the Trust in the event that the sum so intimated by us is lower than the relevant parts of the original Funeral Plan cost”

Yes, what an absolutely crap deal for consumers. I pay for a £3500 funeral and get one costing hundreds of pounds less — a bit like finding myself in a 2 star hotel when I’d paid for 4.

And yes, what John and I had created is a thing of unparalleled and luminous beauty which is also very badly needed. We call it GFGPlan. 

Your conventional prepaid funeral plan is beginning to look as dated as the mullet. Imagine a restaurant that serves only fixed 3-course meals cooked to recipes first published in Woman’s Own in 1958; that’s what you get with a conventional funeral plan.

Today’s funeral buyer wants cafeteria service – a bit of this, some of that, no limousine thanks.

Today’s funeral director doesn’t want to have to shoulder the risk of its plan provider finding itself a bit short.

The beauty of GFGPlan is its simplicity. It’s a pot. Into which you put money. As and when. It grows at 4% pa. None of the money is spent on salaries, commissions or freebies for noisy bloggers. It empowers the consumer to buy what they want and no more than they want. It pays a proper price to funeral directors. 

Is it risk-free? If there was a total global financial meltdown, no. But if every GFGPlan-holder died today, the trust fund would be able to cover every single one of them. Can any other prepaid plan provider can say that?

If you’ve not yet studied GFGPlan, we strongly recommend that you do so. Start here.

Dog eats dog. Move on, leave them to it

11 February 2015
Charles
11 Comments
Categories: funeral plans, pre-need plans

Here’s the hot news:

“… we can today formally announce that we have initiated legal proceedings against the UK’s largest provider of pre-paid funeral plans, Golden Charter, seeking substantial damages for their actions against Safe Hands Funeral Plans.”

Yes, the Yorkshire terriers have gone for the throat of wee Big Dawgie, and they ain’t stopping there:

“Further claims against other companies are imminent and will be announced at a later date.”

Blimey, what’s this all about?

It seems that Safe Hands “recorded video and audio footage (presented, in January 2015, to the perpetrators via our solicitors) that shows representatives of most of the major plan providers launching vicious, unprovoked, verbal attacks – primarily against Safe Hands, but on each other as well…all in a desperate and shamefully unprofessional effort to get an edge over the competition.” Looks like a sting.

While the lawyers order trebles all round and get ready to enwrap both parties in litigation for as long as legally possible, the good citizens of Funeralworld tremble. A lot of heavily soiled linen looks like being washed in public. God forbid that the public learn just how much of the money they spend on a funeral plan gets divvied up among sundry predators in the form of commissions, sales and marketing costs, directors’ wages, you name it.

Golden Charter describes itself as “owned by and run entirely for the benefit of independent funeral directors”, a claim a great many independent funeral directors now reject. On its website, GC confesses “We work on behalf of more than 3,300 independent funeral directors throughout the UK.” Why on earth would anyone want to buy a funeral plan that works in the service of the very people who stand to make money out of them? Beats us.  

But GC has achieved a market share great enough to enable it effectively to act as funeral broker, and that’s seriously worrying. So: praise the Lord if the hullabaloo has the effect of concentrating minds and curing funeral directors of their dependency on this lousy financial product.

So far as we are concerned at the GFG, the present squabbles are between businesses with a failed business model.

Going forward, we recommend that funeral directors subject a funeral plan to the Lynch Test before endorsing it. The Lynch Test? Yes, the Lynch Test. It goes like this:

Does this plan facilitate face-to-face accountability between the buyer of the funeral– the personal representative of the person who has died — and the seller — the funeral director?

The only good funeral plan is one that restores the lost link between buyer and seller.

Again: The only good funeral plan is one that restores the lost link between buyer and seller.

Can this be achieved? Yes, it can. Shortly, we’ll show you how.

UPDATE 12-02-2015: I wrote to David Latham at NFFD HQ asking how Safe Hands had funded its prime-time ad slot on ITV on 09-02-2015. He replied as follows: 

“The advertising campaign is limited to the Yorkshire area only and was a special introductory package for a new advertiser. Consequently, the amount spent was minimal. More importantly, the cost was met by the NFFD, so I can state, categorically, that it most certainly WILL NOT affect the long term investments of Safe Hands’ plan holders. Whereas some other providers use their clients investments to advertise their services, you may be interested (and comforted) to know that Safe Hands most certainly does not.”

An offer they can’t refuse

18 December 2014
Charles
12 Comments
Categories: funeral plans

A number of independent funeral directors have sent us a copy of a letter they have received from Golden Charter:

Dear _________

The latest Funeral Planning Authority statistics confirmed that Golden Charter is now the leading seller of funeral plans. As a non-seller, your existing plans currently do not attract our seller’s additional premium, payable when the plan matures. To date, Golden Charter has held this seller’s premium in the Trust in the hope that your company would, one day, become a seller of Golden Charter plans. 

However you, along with other non-selling independents, have declined several invitations to become sellers, and it appears unlikely that you will join us in the future. This means we are now holding money in the Trust which is unlikely to be required and much of that contingency can be released for redistribution to our shareholders and exclusive sellers in the years ahead. 

In November the board unanimously agreed that those funeral directors who do not actively sell Golden Charter funeral plans after 31 December 2015 will no longer be eligible for this historic premium on existing plans, even if they should become an active seller at a later date. 

…

It is not too late … I would urge you to reconsider …

Of course, this is not the only attraction. Sellers of Golden Charter plans also receive allocations of future funerals. We allocate far more plans or legal charges than all the other companies combined and the volume is growing rapidly. Gaining your share of that future market must make becoming a seller worthy of consideration. 

… 

In closing, it is my hope that you will take this opportunity to join with Golden Charter, and become part of the success story owned by and run entirely for the benefit of independent funeral directors.

The letter is signed by Michael Corish, Managing Director.