Category Archives: funeral plan authority

funeral plan authority

Assist Funeral Plans Ltd

We have never had any dealings with Assist Funeral Plans Ltd which appears to be no longer trading. We were approached by a member of the public who had purchased an Assist Funeral Plan and was unable to get any response from them.  In theory, the clients’ funds should be perfectly safe in the Assist Funeral Trust – but we have as yet been unable to find out who manages that or where it is located.

Company details are available here (direct download from Companies House._

The Director is listed as GORDON, Michael Thomas.

His correspondence address was listed as 5 Jupiter House, Calleva Park, Aldermaston, Reading, Berks, United Kingdom, RG7 8NN (the address of UK PLC Registrations).  Mr Gordon apparently held 882 directorships!  Another address was Trevor Cottage, The Green, Horsted Keynes, Haywards Heath, West Sussex, RH17 7AW.

The only shareholder of the company was listed as Sibtain Mohammed Hussain.

The address listed for Sibtain Hussain seems to be an accommodation address at 3rd Floor, 207 Regent Street London W1B 3HH. Again, we contacted them on 12th December 2018 to see if they could help -(update) they have had no dealings with Assist at all and advise me that they occupy the whole building.  so this route won’t help: accommodation address agencies are required to confirm the identity of their clients, so if they were being used they should have more information.

We contacted the Funeral Planning Authority and this is what they had to say about Assist:

We recommend you contact the FCA Unauthorised Business Unit using the following email address: consumer.queries@fca.org.uk and request information on Assist Funeral Plans.  You can do this directly or through Trading Standards / Citizen’s Advice.  It may also be worth registering your concerns with the Police using the action fraud website (https://www.actionfraud.police.uk).  Assist Funeral Plans were not registered with the Funeral Planning Authority but the FPA will provide assistance to you if you and they can and can be contacted at info@funeralplanningauthority.co.uk.

A further disturbing article appears here.

If you have any further information please do let us know, with our Funeral Plan Watchdog hats on.

Competition in the Funeral Sector

The interim report published on 29th November 2018 presents the issues the Competition and Markets Authority (CMA) has identified since launching a Market Study into the funerals sector 6 months ago.

Stephen Pett (8)Stephen Pett of The Prepaid Funeral Review says “We are pleased to see these issues being addressed, which can only give people more motivation to plan ahead to avoid unexpected and often very large bills being imposed on vulnerable and grieving relatives. Dealing with vulnerable people is (or should be) an exercise in integrity, not sales skills, something which some firms forget!

Its initial work indicates problems with the market that have led to above-inflation price rises for well over a decade – both for funeral director services and crematoria services. The scale of these price rises does not currently appear to be justified by cost increases or quality improvements.

Given the nature and significance of the issues the CMA has identified, it believes the full powers of a Market Investigation – carried out by an independent group of CMA panel members – are required. Issues include that:

Today, people generally spend between £3,000 and £5,000 organising a funeral, and the price of the essential elements has increased by more than two-thirds in the last 10 years, almost 3 times the rate of inflation. Organising a funeral would now cost those on the lowest incomes nearly 40% of their annual outgoings, more than they spend on food, clothing and energy combined.

Customers could save over £1,000 by looking at a range of choices in their local area. However, people organising a funeral are usually distressed and often not in a position to do this – making it easier for some funeral directors to charge higher prices. Prices are also often not available online, making it difficult to compare options.

While some smaller funeral directors have sought to keep their prices low, other providers – the larger chains in particular – have implemented policies of consistently high year-on-year price increases. A number of these have now introduced lower cost funeral options, but this doesn’t go far enough to make up for years of above inflation price hikes. The CMA’s evidence also indicates most people who organise a funeral remain extremely vulnerable to exploitation and future rises in charges.

Cremations account for 77% of funerals, yet there are limited choices for most people in their local area and fees charged by crematoria have increased by 84% on average in the past 10 years, more than 3 times the rate of inflation.

Andrea Coscelli, chief executive of the CMA, said:

People mourning the loss of a loved one are extremely vulnerable and at risk of being exploited. We need to make sure that they are protected at such an emotional time, and we’re very concerned about the substantial increases in funeral prices over the past decade.

We now feel that the full powers of a market investigation are required to address the issues we have found. We also want to hear from people who have experienced poor practices in the sector, so that we can take any action needed to fix these problems.

The CMA will now be consulting on the potential market investigation reference and welcomes any views on the issues identified in its report by 4 January 2019.

It would also like to hear from people involved in the industry and others, who may have observed instances of poor quality standards in the back-of-house facilities of funeral directors. Details on how to respond are available on the funerals market study page.

Safe Hands Funeral Plans and the FPA

The Funeral Planning Authority

Though there is no statutory regulation/governance of the funeral plan industry at the present time (meaning there is no official set of standards that funeral plan companies must, by law, conform to), here at Safe Hands Funeral Plans – as a company committed to ensuring customers’ best interests are served at all times – we fully advocate and support the idea of there being statutory regulation of the industry and we feel that the FPA, with its industry knowledge, experience and expertise should be given statutory regulatory status by the government (which would mean that all funeral plan providers, by law, would have to be registered with the FPA).

In May 2018, Safe Hands Funeral Plans submitted its formal application for registration with the Funeral Planning Authority. For any provider, the application, assessment and approval process can and does take several months to conclude – and here at SHFP we are as confident as we can possibly be that our all aspects of our operation will be found, by the FPA, to meet with their qualifying criteria, and that we will be successful in becoming registered with them well before the end of the 2018. In the mean time, customers should take great comfort from the fact that legislation exists, under the Regulated Activities Order (Financial Services and Markets Act 2000), that all funeral plan companies must, by law, abide by to ensure their customers’ monies are invested in trust funds that are independent (meaning the customers, not the company, are the beneficiaries of the trust fund), that the investment of the trust fund is independently managed, that the assets of the trust are independently analysed every 3 years to assess whether they are sufficient to cover the company’s liabilities (customers’ funerals, in other words), and that the company itself is independently audited. In all respects, Safe Hands Funeral Plans complies with this legislation.

Further details about the FPA and their registration process can be found at www.funeralplanningauthority.co.uk.

Funeral Plan Research – How Big Is The Teacup

Below is an article produced by Dignity Funeral Plans commenting on a report they paid for from Fairer Finance.

Our comments: the report itself is actually not too bad, but Dignity has overhyped it to follow their own agenda.   One interesting fact it unearthed is that Dignity Funeral Plans no longer cover doctors fees for cremation.

It also fails to point out that Dignities many crematoria charge around 50% more than the average, thus disadvantaging other providers some of whose third-party allowances are not enough even to pay the fee at a Dignity crematorium! To be fair, they do offer much longer time slots than many other crematoria, so higher costs are inevitable.

FCA regulation, with its predecessors, managed to reduce the availability of person to person financial advice by more than 90%, and decimated the number of genuine independent financial advisers.   Whilst we agree there are cowboys selling the plans, and some of the literature could be a great deal clearer, on past record, FCA regulation would be a disaster for all but Dignity and the Coop who either have direct sales forces or tied agents, mostly very big – Dignity cancelled our agency because we couldn’t promise to sell 1,000 of their plans every year!  Independent Advice, such as ours, would be priced out of the market by heavy-handed regulation.

On to the PR, there is a link to the actual report at the bottom.

Funeral Plans Research: Lack of regulation leaves millions of consumers at risk

Unregulated funeral plan market leaves millions of pounds of consumer money at risk

  • Report says perfect storm is brewing of misleading sales practices, lack of consumer understanding and lack of regulation in funeral sector
  • Up to 6 million people over the age of 50 have been contacted; around a third of those contacted felt they were pushed to take out a plan
  • Lack of transparency and compensation scheme means millions of pounds of consumer money could be at risk
  • Report calls for statutory regulation of the funeral plan sector

Independent consumer group, Fairer Finance, in partnership with Dignity Funerals, has published a report calling for stronger regulation of the funeral planning industry. The report, “Is the prepaid funeral planning market working well for consumers?” suggests there is significant evidence of mis-selling within the industry and that millions of pounds worth of consumers’ money could be at risk. Although the report was commissioned by Dignity, Fairer Finance retained full editorial control.

Funeral plans are an effective way for consumers to plan and pay for a funeral. Between 2006 and 2016 there has been a near fivefold increase in the number sold each year.  As a result 1.2 million UK consumers now own a plan. It is believed that a significant proportion of this growth is due to websites purporting to be comparison sites combined with high pressure telesales tactics.

Funeral plans look and feel like a financial services product, but 75% of consumers wrongly believe their plan is regulated by the Financial Conduct Authority.

The report shows that:

  • There is evidence of persistent and high pressure sales practices often through aggressive third party sales intermediaries. A telephone survey of 1,001 adults over the age of 50 indicates that as many as 6 million people have been marketed to by funeral plan providers or their agents and nearly half (49%) of those contacted over the phone have been re-contacted 2 or more times, 46% agreed that they were being pushed to take out a plan when re-contacted and 63% felt this additional communication was not ‘useful’.
  • Lack of clarity – Consumers do not understand the differences between plan types, are confused by industry terms and are unaware of the potential for and scale of extra costs, and other product exclusions. Over 90% of those identified as contribution style funeral plan holders wrongly thought their plan guarantees to pay for cremation costs when this was not the case.
  • Mismatch of customer expectations – The research demonstrated that consumers tend not to understand what is and isn’t guaranteed by their plan. Customers buying these plans are often elderly and more vulnerable and not around to check whether the product met their expectations when a claim is made.
  • Safety of consumer money – There is very poor transparency around what happens to customer money. While all money must be placed in a trust, or a whole of life policy, few providers are explicit about funding levels and where the money is invested.  There is no safety net if a provider was to become insolvent.
  • Lack of consumer protection – The industry is subject to voluntary regulation by the Financial Planning Authority. Some providers are not part of this voluntary regulation scheme.  Third party sales firms are not even subject to voluntary regulation. Consumers do not have access to an Ombudsman service in the event their complaints are not resolved satisfactorily.

James Daley, Managing Director and Founder, Fairer Finance, said; “Funerals have become ever more expensive over the past decade, and pre-paid plans can be a great way of locking in today’s prices, whilst also ensuring your family isn’t left with this significant financial burden after you’re gone. Although there are some reputable providers working in the interests of consumers, the sector has rapidly expanded over the last few years, with our research revealing a worrying number of conduct issues and lack of consumer protection.

“The combination of a fast growing market fuelled by high pressure sales to a potentially vulnerable customer base is creating a perfect storm. A growing number of customers are likely to be let down when their plan is claimed on – with some funeral plan providers passing on significant extra costs to the families. And there is a concern that client money is not always being adequately looked after. Without intervention, we may yet see a Farepak-style collapse in this market, which leaves thousands of customers out of pocket.”

Simon Cox, Head of Insight and External Affairs, Dignity, commented;
“The sector is evolving into a two-tier market; those committed to offering quality products and services, versus those willing to “sell at all costs”, without strong governance or worry about fair customer outcomes.

“We believe a governance gap is responsible for an explosion of online and telesales organisations who have moved on from PPI and accident claims management into funeral plans. Our worry is that this situation is not sustainable, and before too long poor practice will result in one or two struggling to fulfil their obligations, leaving the rest of the sector to deal with the debris.”

Dignity and Fairer Finance are committed to working positively with consumers, government regulators and partners in the industry to explore these recommendations and encourage other plan providers to do the same. It is hoped that over the coming months, an improved consumer environment in the sector can become a reality.

Click here to download the full report

Funeral Planing Authority On Fairer Finance Report

The Funeral Planning Authority has its comments below. We believe that the Fairer Finance Report is highly influenced by its sponsor.  Dignity offers very expensive funerals and very expensive funeral plans. It operates 17 of the 20 most expensive crematoria in the UK and has been reported to the Competition and Markets Authority for its efforts in increasing costs with local monopolies.  The Funeral Planning Authority has made steps forward in its make up, but until it takes monitoring its own members seriously, it can’t pretend to be a Regulator. That said, anything is better than sending in the wrecking crew from the Financial Conduct Authority.  Yes, funeral plan sales need standards, and the industry (NOT led by the FPA) js taking giant strides to stop sales through call centres who do not act with integrity.   FCA Regulation has a track record of reducing the availability of advice by 95% – and we offer advice, not sales.

But on to the Funeral Planning Authority Press Release:

The FPA recognises some of the challenges within the Fairer Finance report and believes that driving up industry standards and helping to protect customers’ interests is of the upmost importance – and central to our work.  It is partly for these reasons that we have recently made our Board fully independent and are investing further in our Compliance activities.

Many of the issues which are detrimental to consumers relate primarily to providers who are not registered with the FPA and we believe this supports our view that customers should only deal with registered providers. We also believe there is a strong case for this to also apply to funeral directors.  Support for this approach would very quickly eliminate some of the poorest behaviour in the market.

FCA regulation is not the ‘easy’ option
When it comes to increasing regulation as recommended by the report the FPA believes that FCA regulation of the sector is not the ‘easy’ solution that it first seems. The report effectively acknowledges that it would take years but also suggests a lift and drop approach to FCA regulation would be relatively easy to implement. Given the different business models that exist we do not believe this to be the case. As a simple example in a trust based model it is not clear whether the FCA would regulate the provider, the trust or both.
 
FCA regulation would not lead to a better outcome for customers 
FCA regulation of the funeral plans sector would not lead to a better outcome for consumers as it would:

    • Increase the cost of plans as increased compliance costs are passed on to customers.
    • Reduce market choice as smaller players are excluded from the market to the benefit of larger players.
    • Potentially remove Funeral Directors from the sales process as the FCA regulatory regime makes it too onerous for firms to supervise them.
    • Move selling to more telephone based models that fit better with the FCA compliance regime.
    • Reduce the scrutiny on individual providers as these providers would be small firms in the FCA hierarchy of firms – increasing the likelihood that FCA would adopt a one size fits all approach requiring providers to meet similar standards and expectations to those applied to much higher risk sectors.
    • It has also been suggested that FCA regulation would provide access to the Financial Ombudsman Service and the FSCS. It is not at all clear how this would work in relation to these plans, which are a pre-payment for a funeral and not a financial investment.

FPA’s focus is to drive up standards with the end consumer front of mind
At the FPA our focus is to provide reassurance to customers that they will be treated appropriately and that the funeral they have purchased will be delivered when needed. To do this we continue to drive up standards amongst registered providers; encourage funeral directors work only with registered providers; and encourage customers to ensure they are buying a plan from an FPA registered provider. Continuing this work – with the support of the industry – is how we believe the industry is best regulated and offers customers the best protection. If, ultimately that needs the FPA to be a statutory regulator then we would support that.