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With funeral costs often reaching £3,000 or more, more and more careful people are taking pre-paid funeral plans.
What do those plans cover? Are they worth it? How much will you have to pay?
This all-you-need to know guide will allow you to compare the best pre-paid plans of the market in 10 seconds, and get to know everything about funeral plans: cover features, prices, tips and much more. Let’s dive in!
Table of Contents
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What is a pre-paid funeral plan?
A pre-paid funeral plan is the best manner to organize and pay for your funeral expenses in advance (limousine, body care, etc.) and take the pressure off your family.
Basically, those funeral plans allow anyone to pay in advance and plan their own (or someone else’s) funeral with the chosen provider. That way, when the times come, no one has to take care of those painful and expensive things.
You will not only protect your relatives and loved ones against unexpected costs related to your own funeral, but you will also be sure that things happen the way you want them to happen.
Are prepaid funeral cover worth it?
With the rising cost of funerals, often reaching up to £4,000, people are getting more and more prepared, taking pre-paid funeral plans. Actually, about a fifth of all British funerals are paid in advance through those paying schemes.
Key benefits of pre-paid funeral plans are:
- they give you and your loved ones entire peace of mind regarding how things will be handled;
- you will take the pressure off your children, step-children, family relatives when the times come, financially but also emotionally;
- you will have things organized the way you want (cremation, celebration, limousine etc.);
- they protect you against inflation in case funeral costs increase;
- funeral costs will be withdrawn from your financial inheritance and therefore not subject to taxes;
- pre-paid plans can become very advantageous if you are moving in a really expensive place such as London, where burial plot cost can reach £10,000.
Funeral pre-paid plan will not cover your relatives against rising third-party allowance fees such as cremation cost.
Getting a pre-paid funeral plans really worth it especially when you are getting older, suffering from medical conditions or having a risky life through your job or living conditions. However, anyone aged of 18 or over can apply to a pre-paid funeral plans.
The alternative of not purchasing pre-paid funeral plans is to save money in a separate account. However, you will not be protected against a rise of funeral main cost. The other main thing to know is that, paying upfront, those funeral costs will be excluded from your financial inheritance and therefore not subject to taxes.
How does pre-paid funeral plans work?
They are 3 main different ways to pay for your pre-paid funeral plan:
- you can pay in full at the time of purchase. This is a popular option to avoid inflation, and take the financial pressure of your family with left-to-pay monthly installments. You do not to have the total sum saved on an account though;
- you can pay monthly, over 12 months. This is a good in-between option as it will allow you to decrease risk of funeral cost inflation only spreading payments over 12 months, but still benefit from affordable premiums;
- you can spread the total funeral cost over several years (from 2 and up to 30 years) to benefit from monthly premiums starting at only a few pounds per month. However, your loved ones might have to pay remaining installments.
Pre-paid funeral plans are not, at this time, regulated by the Financial Conduct Authority but are about to be. Meanwhile, if you are planning to buy a funeral policy, make sure your provider is registered with the Funeral Planning Authority.
How much is a funeral plan in UK?
Let’s find below indicative funeral costs and pre-paid monthly premium depending on the level of pre-paid funeral plans you’d like.
|Average funeral cost|
Can I pay for my funeral now?
Funeral insurance are prepaid plans, you pay in advance for what will happen later, at today price. You can pay either monthly or annually, most insurer propose monthly payment.
Is it smart to prepay your funeral?
Yes, it is a smart option to prepay your funeral expense payment. The average cost of a funeral is around £2000. Funeral expenses payment are quite flexible, as you can pay monthly or annually.
Choosing prepaid funeral cover is a smart idea, as it will give peace of mind for you and your family.
What does a funeral plan cover?
The best prepaid funeral plans include:
- A simple or high quality coffin depending on what you’ve chosen;
- Mileage cover: fees related to body transportation and hearse;
- Care and visit of the body in a chosen chapel;
If you opt for a more premium policy, you may also find as included as standard:
- Third party allowance (cremation cost, minister/celebrant cost, doctor fees, limousines…): this is often included in the funeral plans but take a close look at your contract, if you chose the cheapest funeral plan, sometimes this is not included.
What does pre-paid funeral plans not cover?
Funeral plans do not cover:
- Memorial, headstones, burial plots;
- Funeral notices in local newspapers;
- Extra body care such as embalming;
- Funeral flowers and after-celebration catering.
Burial plots can be extremely expensive, reaching £10,000 in some areas of London, against a hundred pounds only in very rural areas. Make sure you’ve taken this into account in your calculation.
Should you pay your prepaid funeral cover in full or monthly?
Funeral costs can be heavy. Paying in full for £3000 or £4000 is not an easy thing. You can also pay your funeral cover monthly, a lot of providers propose this option.
You should know that by paying monthly, you will have fees that will be added to your funeral cover cost. Be aware of that, you will save about £200 or £300 if you pay in full your funeral cover.