Get the facts before you pay upfront

money@mirror.co.uk FUNERAL plans are big business – 1.5 million of them have been sold over the past decade.

Taking out a plan can be a good way for families to protect themselves against the escalating cost of funerals and they are a means to spread the bill into affordable repayments.

People are attracted because the average funeral costs £3,757, and for a burial it is £4,267.

However, the industry is not regulated by the Financial Conduct Authority, despite the fact it involves people paying cash upfront in a lump sum or via instalments, for a product that may not be used for many years.

This leaves people vulnerable to rogue firms and that can mean highpressure selling, losing money paid into plans, and being left with no funeral. Some families then don’t get what was paid for in advance and are slapped with unexpected bills.

There is an industry voluntary regulator, the Funeral Planning Authority, which firms can choose to sign up to and which means they follow a code of practice.

This offers some reassurance for people taking out plans, but not all providers are signed up to it.

The Government is currently looking into how the funeral plan industry can be better regulated due to concerns about high pressure and misleading sales, a lack of redress if things go wrong, and doubts about the way cash paid upfront is handled by some firms.

And the Competition and Markets Authority has launched a major investigation into the funerals market, which is estimated to be worth £2billion a year, after it found prices had risen well above inflation for the past 10 years.

A study into the funeral plan sector by consumer group Fairer Finance found serious problems, from heavyhanded sales tactics to concerns over the security of people’s money.

And it uncovered the fact that there is confusion over funeral plans as people don’t understand the difference between the types of schemes on offer – some are comprehensive and cover all costs, while others pay towards some costs and don’t include other vital elements.

And worryingly, three-quarters of