Call for statutory regulation of pre-paid funeral plans
12 August 2018
Funeral plan provider Golden Charter has called for the Funeral Planning Authority to be given the power of statutory regulation of pre-paid funeral plans, arguing it would better serve IFA and consumer interests.
The group says providing the FPA with enhanced powers would provide the funeral market with a focused regulator. According to Golden Charter, if the funeral market were to be regulated by the FCA it could put the choice of the funeral director for an intermediary’s client at risk as it would impose a regulatory burden that does not take into account the nature and size of a funeral director’s business.
Mark Moran, Golden Charter’s director of sales, said: “We welcome the call for evidence by HM Treasury and hope we can get to a point where consumers, and intermediaries, fully understand what they are getting when they take out a funeral plan, as well as ensuring any questionable practices are removed from the industry.”
While the majority of pre-paid funeral providers are members of the FPA, membership remains voluntary. As such, Golden Charter is campaigning for membership to become compulsory.
Moran added: “As a founding member of the Funeral Planning Authority, consumer protection has long been a priority for Golden Charter and we strongly believe the best way forward when it comes to regulation is to make membership of the FPA mandatory and provide it with statutory powers so it can hand out appropriate sanctions.”
But despite calls by some industry commentators for plans to move to an insurance-only backed model, Golden Charter has said that since only four insurance companies currently underwrite such contracts, the sector should retain both trust-backed and insurance-backed options.
Moran continued: “Funeral plans play an important part in later life planning, particularly as funeral costs have outstripped inflation in recent years. As such it is important that customers and intermediaries know they have the flexibility when it comes to paying for the funeral plan, as well as understanding what they will receive at maturity. We believe in offering a wide range of payment methods to ensure customers can select the option that best suits their individual circumstances, and our independent Trust allows just that.”
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