There was an article in a recent weekend Guardian about funeral plans, with a headline saying more than 200,000 were sold last year but experts warn they could become a national scandal. At Probaters it is a little bit of a hobbyhorse as we have seen the dangers for a long time. The concept of a funeral plan is not bad in itself. In limited circumstances, it is a very good idea but there is no way a funeral plan should become a universal product. There are striking similarities between these plans and PPI: products sold to anyone whether needed or not and hard sellers chasing the commission.
They are promoted heavily by funeral directors and it was interesting to note that one particular funeral director summed up the opposition case. Lucy Coulbert said that “as a funeral professional I wouldn’t let my grandmother touch one with a bargepole – they’re that bad”. Another funeral director is quoted as saying “you don’t need to buy a plan: you just need to talk to your family and say: ‘look when the time comes this is what I want to happen’. I tell people to go and get an ISA … that will make enough money to pay for most of a funeral”.
The costs of a funeral and a memorial are the only post death liabilities which reduce the value of an estate for inheritance tax purposes. In the great majority of cases it just makes sense to let the estate bear the cost of the funeral.