Funeral Plans – A Sensible Option or a Con?

March 26th, 2015 | Posted by Lynn Strother in London | Older People

Do you have a funeral Plan? Have you thought about getting one? What do they cover? Do they save you money or is it just another type of insurance scam?

Most funeral plans have two or three levels of cover at varying costs – basic, moderate, premium – all offer something different and are called different things depending on which plan you choose. And it is important to go very carefully into choosing your plan, especially looking at the small print for exclusions so your friends and family are not landed with a massive bill which almost defeats the idea of getting a plan in the first place.

So what do most basic plans cover? Research by Mintel describes a basic funeral as averaging £3609 – nine years ago it was £2311 so you can see that if you bought your funeral 9 years ago – you would have made a considerable saving (although I am not sure how relevant it will feel to you as you will be laid out). For the £3609 you are likely to get a coffin, service and transporting the body – this also presumably covers you being picked up at the hospital or where you die and taken to the funeral directors but worth checking. What is not covered are things like flowers, limousine hire, venue and catering costs for the ‘wake’, publicity re the funeral, service leaflets etc. All this in a basic way can increase the cost of the funeral to over £7000.

The bad news is that Londoners pay nearly 35% more than the national average.

The bonus side of having a funeral plan is that you choose how you want to leave this world; do you want a service? Do you want friends and family to say a few words about you and your life? Do you want poems from your favourite poets? What special music? Do you want a family member to read out a message from you? Do you want flowers or donations to your special charity, or to the hospital where you were cared for? Where do you want to go? If you want to be buried – where? If cremated – where do you want your ashes scattered? What sort of ‘wake’ do you want – family to go for a meal together, hiring a venue and having all friends, family, neighbours, colleagues etc.? When you think of the possibilities for the service and after – there are endless possibilities and in several plans they will let you change small details over the years. There is no hassle for your family at a difficult time – the firm providing the plan will usually contact the funeral director for the family and handle the majority of the arrangements.

The other big advantage is that once you have paid – either a lump sum or instalments (although some providers charge interest if instalments cover over a year) you are protected from any further increases in funeral prices.

Disadvantages include having to really read the small print, to feel comfortable discussing your plans with friends and family, virtually all plans exclude burial plots, headstones and temporary grave markers. Burial costs are expensive due to the increasing land shortage. Half of the 358 local councils have said they will run out of burial spaces within 20 years and in London even faster.

Some plans exclude doctors fees – needed especially for cremation – and Ministers fees and all fees will increase by inflation. Although most will include transport of the body, many have a restricted mileage – 20 miles seems to be the average. Not all will offer a Chapel of Rest.

Of course there are alternatives – if you have a life insurance policy or over 50’s life insurance, check to see if it covers funeral costs. Most policies will pay out a lump sum for a funeral but family and friends will have to make all the arrangements. Some insurers will offer a discount on funeral arrangements if the lump sum is paid direct to a funeral director rather than family members.

You could just open a savings account specifically for your funeral but, with interests so low, would it be good value for money?

Banks will usually release money early from an estate to pay for funeral cost on the production of a death certificate and an itemised bill from the funeral directors.

If your family is on a low income they may be eligible for a funeral payment from the government providing the welfare changes do not cut these. At present a payment of up to £700 may be paid to cover burial or cremation fees. If you are fortunate to be leaving a fairly large estate on your death then again you should take advice as it may be more value for money for your funeral to be paid from the estate as all taxes on estates are based on funds after all debts and expense have been paid.

Of course you may decide not to have a funeral at all but to leave your body to medical science. This is obviously a very humanitarian gesture in offering yourself for the future of others. One of the difficulties may be if an inquest is required following your death as obviously, for medical science, they need the whole you.

Before you decide anything talk it over with friends and family and then get advice – don’t go for the first leaflet that comes through the door. Make sure you find out as much information as possible before deciding.

And whatever you decide to do – remember to highlight to friends and family and the funeral director that you have joined the NHS Organ Donor  Register. Call 0300 123 23 23 or visit www.organdonation.nhs.uk. You are in the unique situation of being able to improve another persons quality of life – the perfect gift to mark your leaving this world.

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