Prepaid Funeral Plans
May 21, 2012 By Frank & Kraft, Attorneys at Law
The prepaid funeral plan is basically a plan that allows someone to prepay for their final arrangements, as well as plan them in advance. The money is either held in trust until it is needed, or will be taken from an insurance policy. Due to the rising costs of funerals and burials, the prepaid funeral plan has become very popular in recent years.
According to surveys conducted by AARP, about 32% of people over the age of 50 have made some type of prearrangement for their funeral or burial.
When someone makes arrangements with a funeral home and pays for it out of pocket or through a life insurance policy, there is no government regulation. If the arrangement involves a third party or a contract, the government then regulates it.
There are a number of advantages to prepaid funeral arrangements.
You will not have to stress about the details because you’ll know that it is all taken care of and paid for.
It will ease the burden on your loved ones during a very difficult time.
With a prepaid funeral arrangement you can control everything about your own funeral.
Having your final arrangements already paid for will keep your family from having to get into their savings or sell assets to cover the cost of a funeral.
If there is a contract you are guaranteed the products and services that you purchase, or an equivalent if the products or services are not available at the time they are needed.
The cost of products and services will be locked in, so you will pay nothing more even if the cost triples.
The contract may allow for a transfer to another funeral home or a refund if you are no longer in the area at the time services are needed.
Though there are many advantages to the prepaid funeral, there are also a number of problems that you may encounter as well.
If your plan includes a trust fund or insurance funding, you may not be eligible for a refund if you cancel the plan.
It is necessary to read your contract carefully concerning any transfer of the plan to another funeral home. If you leave the State, you may not be able to transfer the plan unless it specifies that you can in the contract.
The funding options may also be different after transferring the plan.
If an itemized list is not given to you at the time you sign the contract, it is possible that the funeral home can claim some services were not included.
If the funeral home goes out of business you may not have a way to recoup your investment.
If you are thinking about a prepaid funeral plan it is a good idea to contact the state board that regulates the funeral industry, as well as consumer groups. Always read the contract completely before signing and agreeing to a prepaid plan.
ABOUT THE AUTHOR: Paul Kraft
Experienced estate planning attorneys Indianapolis IN of the Frank & Kraft Attorneys at Law offers estate planning and business planning resources to residents of Indianapolis IN.
Copyright Frank & Kraft, Attorneys at Law
More information about Frank & Kraft, Attorneys at Law
Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.
When someone makes arrangements with a funeral home and pays for it out of pocket or through a life insurance policy, there is no government regulation. If the arrangement involves a third party or a contract, the government then regulates it.
There are a number of advantages to prepaid funeral arrangements.
You will not have to stress about the details because you’ll know that it is all taken care of and paid for.
It will ease the burden on your loved ones during a very difficult time.
With a prepaid funeral arrangement you can control everything about your own funeral.
Having your final arrangements already paid for will keep your family from having to get into their savings or sell assets to cover the cost of a funeral.
If there is a contract you are guaranteed the products and services that you purchase, or an equivalent if the products or services are not available at the time they are needed.
The cost of products and services will be locked in, so you will pay nothing more even if the cost triples.
The contract may allow for a transfer to another funeral home or a refund if you are no longer in the area at the time services are needed.
Though there are many advantages to the prepaid funeral, there are also a number of problems that you may encounter as well.
If your plan includes a trust fund or insurance funding, you may not be eligible for a refund if you cancel the plan.
It is necessary to read your contract carefully concerning any transfer of the plan to another funeral home. If you leave the State, you may not be able to transfer the plan unless it specifies that you can in the contract.
The funding options may also be different after transferring the plan.
If an itemized list is not given to you at the time you sign the contract, it is possible that the funeral home can claim some services were not included.
If the funeral home goes out of business you may not have a way to recoup your investment.
If you are thinking about a prepaid funeral plan it is a good idea to contact the state board that regulates the funeral industry, as well as consumer groups. Always read the contract completely before signing and agreeing to a prepaid plan.
ABOUT THE AUTHOR: Paul Kraft
Experienced estate planning attorneys Indianapolis IN of the Frank & Kraft Attorneys at Law offers estate planning and business planning resources to residents of Indianapolis IN.
Copyright Frank & Kraft, Attorneys at Law
More information about Frank & Kraft, Attorneys at Law
View all articles published by Frank & Kraft, Attorneys at Law
Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.
