Prepaid funeral plans guide 2022

From the 29th July 2022, UK prepaid funeral plans will be regulated by the Financial Conduct Authority (FCA), providing protection for consumers.

This guide provides details of funeral plan providers the FCA ‘intends to approve, along with information, prices and reviews to help you find the right plan for you.

Over50choices is an independent company. We do not give funeral plan advice and are not associated with any provider.

Ashley Shepherd

Updated 29th July 2022

What is a funeral plan?

A funeral plan lets you arrange and pay for your funeral in advance and at today’s prices. Pre-arranging the services of a funeral director this way and making the arrangements now can make things easier for family when the time comes, both financially and emotionally.

Is buying a funeral plan a good idea?

A funeral plan could be a good idea if you have the money available and want to remove the pressure of arranging and paying for your funeral from your family. Also, as you freeze costs at today’s prices, it could help avoid inflation if funeral costs continue to increase.

If you are considering a prepaid plan, it’s always a good idea to make sure the company you choose is a reputable one and your money is protected. From the 29th July 2022, only Financial Conduct Authority authorised funeral plan providers are legally allowed to sell funeral plans. So to choose the best funeral plan for you before this date , make sure they are an "FCA intended to approve" company.

FCA regulated funeral plan providers

Funeral plan provider	FCA Regulated	National or Regional
Avalon Funeral Plans		National
Celebration of Life		National
Coop Funeral Plans		National
Crystal Cremations		National
Dignity Funerals		National
Distinct Cremations		National
Ecclesiastical Planning Services		National
Golden Charter Funeral Plans		National
Golden Leaves Funeral Plans		National
Low Cost Funerals (Memoria & Affordable Funerals)		National
Open Prepaid Funerals		National
Plan with Grace		National
Pure Cremation		National
Choice (Funeral Partners)		Regional
Central England Co-op		Regional
F A Albin & Sons		Regional
Family Funerals Trust		Regional
Freeman Brothers		Regional
Haven Personal Funeral Plans		Regional
Independent Funeral Plans		Regional
Peace Funerals		Regional
Southern Co-op		Regional
Fosters Funeral Directors		Regional
William Alty Funeral Services		Regional

How do funeral plans work?

A prepaid funeral plans lets you arrange your own funeral services in advance. The services included in the plan will vary depending on the type you choose and the provider.

A simple plan for example may include the funeral director’s services, a hearse, a simple coffin and the cremation or burial fees. Whereas a comprehensive plan may also include a more expensive coffin and cars for family.

The price you pay for the services included in the funeral plan is fixed and will never go up. Once you’ve paid for your plan, the services included are guaranteed. So, if funeral costs do increase, your family won’t have to pay a penny more for the services included in your chosen plan.

What is not included in a prepaid funeral plan?

Prepaid funeral plans are designed to cover the basic elements of a funeral, but this does not include all funeral costs. The funeral director’s services, use of the chapel of rest, the coffin, hearse and the cremation fees are usually included however additional services such as embalming, memorial stones, stationary, flowers and the wake aren’t.

And although plans typically include burial fees (or an allowance to help with these costs), this won’t include the actual burial plot.

What is funeral insurance?

Funeral insurance is a term that can be used to describe an insurance backed funeral plan or over 50 life insurance. Here is how the two different funeral insurance options work:

Insurance backed funeral plan

Many funeral plans use a trust fund to hold customers money safe until their funeral services are required, however some use a life insurance policy. With this type of funeral insurance, you pay a fixed monthly premium either for life, or until you reach a certain age (typically this is 90). You are covered for the funeral services included in the plan after an initial waiting period of 1 to 2 years. Depending on the type of funeral insurance plan you choose, it will typically include the funeral director’s services and the cremation or burial fees.

Over 50 life insurance

This type of funeral insurance pays out a cash sum when you die that your family can use to help with funeral costs, or however they prefer. You pay a fixed monthly premium either for life or until you are 90 and you are covered for the cash sum after the initial waiting period of either one or two years*.

What is the difference between a funeral plan and life insurance?

Funeral plans and life insurance are quite different. A funeral plan guarantees to provide your chosen services as detailed in the plan when you die, whereas life insurance pays out a cash sum that can help with funeral costs.

So, a funeral plan provides the actual funeral services whereas life insurance just provides money to help with the costs.

How secure are funeral plans?

Funeral plans are secure as they are regulated by the Financial Conduct Authority which means your services will be secure and your money safe. Authorised funeral plan providers must abide by the FCA’s rules and standards and customers are protected by the Financial Services Compensation Scheme should anything go wrong.

To legally sell funeral plans, a company must be authorised by the FCA. To check your chosen funeral plan provider is ‘intended to approve’ by the FCA , take a look at our table above. Or just go to the FCA’s list of pre- authorised funeral planning companies on their website.

What are the pros and cons of a funeral plan?

A prepaid funeral plan can be worthwhile as there are several advantages in having one in place. However funeral plans also have some drawbacks, so it helps to understand all the pros and cons before deciding if its right for you.

Prepaid cremation plan pros

It can save you money if funeral costs continue rise
Guarantees the services included in the plan
Saves your family from arranging your funeral when the time comes
It avoids possible cashflow issues at the time of need
You choose the type of funeral service you want
Avoids your family being ‘over sold’ services at an upsetting time
Exempt from inheritance tax
Not classed as savings so won’t count in care home means tested assessments
Could save money if you live in an expensive area
Monthly plans provide services after the initial waiting period, even if you haven’t completed the payments

Prepaid cremation plan cons

Could cost more if funeral prices fall
Won’t cover all costs, such as stationary, memorial tributes, the wake, flowers
Some funeral plans have limitations such as the time and location of the cremation
May restrict your use of funeral directors
You may have to pay more if you move area
Could cost more if you live in a less expensive area
You may need the money now

How much does a prepaid funeral plan cost?

The cost of prepaid funeral plans ranges from £3,000 to £4,500 depending on the services included and company you choose. Your method of payment can also affect the price you pay for a prepaid plan, as monthly funeral plan instalment options incur additional fees.

Prepaid plan payment options

Paying in full – the cheapest way to pay as you don’t incur any additional fees. Once you have paid, the services included in your plan are guaranteed with nothing more to pay.

Paying over 12 months – Many UK funeral plan providers allow you to spread your payments over 12 months without incurring additional fees. If you were to die before completing the 12 instalments, your family would need to pay the outstanding balance.

Monthly instalments – payments can be spread between 1 to 30 years depending on the company you choose and your age. As long as your monthly premiums are up to date, your services will be guaranteed once you have paid into the plan for an initial waiting period of either 1 to 2 years**. So if you were to die after the initial waiting period but before your instalments are complete, your services as detailed in the plan would be provided with no charge to your family.

What is the cheapest funeral plan?

The cheapest funeral plan you can buy will depend on the type of funeral you prefer. Direct cremation funeral plans cost less than traditional funeral plans however they don’t include a service. So, if you want to save money and are happy with a simple unattended cremation, direct cremation may be worth considering.

Some companies offer cheaper traditional funeral plans that include a service but have certain limitations such as the date and time of the funeral service. You just need to be happy with the limitations.

What age can you buy a funeral plan?

With many funeral plan providers, you need to be at least 18 years old to apply although some only accept customers who are 50 years of age or older.

You also need to be a UK resident; other than that, your application is guaranteed to be accepted.

What are the alternatives to a prepaid plan?

A prepaid funeral plan lets you choose the funeral services you want at the price you want to pay. However, if your main intention is leaving money to help towards these costs, alternative options are available:

Over 50 life insurance – pays out a cash sum when you die that your family can use however they choose. This could offer an affordable solution but keep in mind that the cash sum paid out is fixed, so inflation will reduce its value over time.
Savings – Putting money to one side each month is one option for helping with funeral costs. It may be worth checking your savings are keeping up with funeral costs and making sure your family has access to the money when the time comes. There is also the chance that you may need to dip into those savings from time to time, which could leave insufficient funds when the time comes.
Your estate – if you have property, savings or investments, then there’s a good chance there will be funds to pay for the funeral. The main consideration is whether your family can access the funds, or if they will need to pay for the funeral out of their own money, recouping the cost once the estate is settled.
Do nothing – if you don’t have funds in place and your family are unable pay, your local council could arrange a public service funeral. It will be the simplest of funerals with no choice in when, where or how the funeral takes place.

Funeral plan top 6 need to knows

If you’re considering buying a funeral plan, our top 6 funeral plan need to knows are designed to help you find the right plan for you:

If you can afford it, paying for your prepaid plan in one go, or over 12 months (if no additional fees) is the cheapest option
Check the plan can be moved if you change address and if there are any associated costs. If you want flexibility, you may also want to check if the company offers nationwide coverage.
Be sure what services are guaranteed so you can budget for additional services if required.
Only choose a company (from 29th July 2022) that is FCA authorised. If they are not authorised, they are not legally allowed to sell you a funeral plan.
Check funeral plan reviews. Some plan providers have better customer ratings than others.
Tell your family you have bought a plan, so they know what to do and who to contact when the time comes.

Compare funeral plans

Your questions answered

Can I choose either a burial or cremation funeral?
- Most prepaid plans give you the option to choose either a burial or cremation funeral but the way the plan works for each service may differ. For example, leading funeral plan providers such as Golden Leaves and Dignity guarantee the cremation fees but make a contribution towards burial fees.
Can you buy European funeral plans?
- European funeral plans are available for people that live or have second homes in Spain, Portugal, Cyprus and the Canaries. They can provide cover for arranging a funeral either there, or here in the UK.
Do I need to choose my Funeral Director now?
- Funeral plan providers use the services of certain funeral directors. For example, Co-op funeral plans use co op funeral directors and Dignity funeral plans use Dignity funeral directors. The plan provider will usually choose one of their panel of funeral directors based on where you live. If you have a specific funeral director you prefer to use, check which funeral plans they accept.
What if I move home?
- Plans provided by national funeral planning companies are flexible and portable, so if you move, the plan moves with you. You simply contact your funeral planning company to let them know your new address and they will move the plan to a funeral director local to your new home.
  
  Some companies may charge for this service though, so it could be worth checking before you buy your plan.
Can I tailor the plan to include my personal requirements?
- When you buy a plan you are typically getting a specific set of services. Some plan providers will allow you to add or change services such as extra cars or a different coffin, but these will incur additional charges.
  
  Personal wishes such as requests for music, readings or poems can be added for free and will help your family understand what you would have wanted when the time comes.
Can I buy a plan for someone else?
- Yes you can buy funeral insurance for someone else. You will be able to specify this when applying for the plan by adding yourself as plan representative. As the plan purchaser and representative, all correspondence will be sent directly to you if you wish.
Do I need a medical to buy a Funeral Plan?
- No you don’t. Your application will be accepted regardless of your state of health.
Do I have to be over 50 years of age to purchase a plan?
- Most providers will allow you to buy a plan from the age of 18, but some have a minimum age requirement of 50.
Can I get an eco-friendly or green funeral plan?
- Eco-friendly or green funeral plans are available and some plan providers include biodegradable coffins in their plans as standard.
What happens if I die abroad?
- If you die whilst abroad your repatriation cover on your travel insurance if you have it would get you back home and then the funeral director will provide the funeral services as outlined in your prepaid plan.
  
  Alternatively if the family decide to have the funeral abroad, they can cancel the plan and receive a full refund minus the cancellation fee.