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Tirey Law July 31, 2017

In the U.K., families are discovering that many pre-paid funeral plans do not cover all of the costs of funerals. Americans often face the same problem.

Funerals can be very expensive and they get more expensive all the time.  To spare their families the expense of paying for their funerals and to hedge against future price inflation, a growing number of people are choosing to get their own pre-paid funeral plans.

The U.K. has seen a huge increase in the number of people that get these plans; however, very frequently the plans do not cover all of the funeral costs.  There are often hidden expenses, such as flower arrangements.

Funeral companies have made it very difficult for many people to learn what is and is not covered. They also face stiff sales competition, so they exclude more and more services from the pre-paid plans.  They often give the customer a lower price without always telling the customer what is not included.

The Guardian reported on this in "Pre-paid funeral plans failing to cover the cost of dying."

The same thing is happening in the U.S. and can create difficulties for many families.

Estate plans often include ways to pay for funeral services.  If an estate planner incorrectly thinks the full cost of a funeral is paid for, then they are unlikely to leave extra money for the funeral in the estate plan.  That means families often need to take assets dedicated for other things to pay for some of the funeral costs which are not covered in the plan.

If you get a pre-paid funeral plan, make sure that everything is included before signing the contract.  If you are not sure if it is, then speak to an elder law attorney.

Reference: The Guardian (July 8, 2017) "Pre-paid funeral plans failing to cover the cost of dying."