At last, safe funeral plans – but we’ll be watching
IT has been a rather fraught journey, but at last the pre-paid funeral plans market is now properly regulated. Since Friday, it has come under the eye of the Financial Conduct Authority (FCA). It means that buyers of plans can now be confident that they are not getting a raw deal – and that the product will do exactly what it says on the tin. That is, pay for the funeral they have bought in advance.
Twenty six companies have made it to regulation. A few (most notably Safe Hands Plans and Unique Funeral Plans) have folded while many others have offloaded their plans to rivals.
Thirteen companies which have not managed to get authorisation have until the end of October to transfer their plans to a rival or refund customers’ premiums.
About 2,000 ‘appointed representatives’ of the 26 regulated firms will be permitted to sell plans. Most are funeral directors. Buyers will be able to check their credentials against the FCA’s list of regulated firms. If their details are not on the register, avoid them like the plague.
On Friday, the FCA assured me that its regulation of the funeral plans market would lead to ‘higher standards’ in the industry and ‘boost consumer protection’. It stressed: ‘We expect to see an improvement in the way customers are treated, with better value products, better sales practices and tighter controls in place so consumers can be confident they will receive the funeral they expect.’
The regulator has done a good job in sorting out the wheat from the chaff. But its work has only just begun. It now needs to ensure that nobody ever again has to go through what 46,000 customers of Safe Hands have just experienced – being informed that their plan is worthless because of corporate greed and wrongdoing.
This newspaper has led the way in exposing the shady world that was the funeral plans market pre FCA – a fact acknowledged last week by provider Golden Charter which thanked us for The Mail on Sunday’s ‘involvement over the last year’.
I trust we won’t have to turn the spotlight on again.
INVESTMENT trust Personal Assets is a bolthole asset. Run by Troy Asset Management, it strives to both preserve and increase the value of investors’ wealth. More Steady Eddie than gung-ho – investing in gold, bonds as well as equities. A fund for all seasons. Over the past year, it has maintained its share value while other high profile funds have crashed through the proverbial floor.
Tomorrow, the £1.8billion fund, listed on the London Stock Exchange, will make itself even more appealing to investors – new and old – by doing a share split. Existing shareholders will receive 10 shares for every one they currently hold, with each new share valued at a tenth of the price.
The overall value of shareholders’ fund won’t change, but it will enable the shares to be more easily traded by private investors. Instead of being valued at around £490 each, they will trade at £49, allowing new investors to buy them more easily through regular savings plans.
It’s a smart move by the trust although it should have made this change a while ago. Personal Assets can be bought through all the major investment platforms, as can similarly defensive trusts such as Capital Gearing, RIT Capital Partners and Ruffer.
TALKING of investment platforms, it is good to learn that Interactive Investor is continuing to chip away at charges.
From the start of September, the cost of buying and selling shares, investment trusts and exchange traded funds through the platform will fall from £7.99 to £5.99.
THIS means its trading charges will be lower than rivals – most notably Hargreaves Lansdown – although Interactive is unusual in applying a monthly subscription fee, ranging from £9.99 to £19.99 dependent upon what service is required.
‘Investors can’t control the markets, inflation or interest rates,’ Richard Wilson, boss of Interactive, told me. ‘But they can control their investment costs.’
Spot on. Lower charges should be the order of the day. Time for Hargreaves to follow suit.