New crackdown on funeral plansSource: HM Treasury | | 04/06/2019
The government has announced new plans to crackdown on high pressure and bullying tactics to sell pre paid funeral plans. These tactics are often used to target those who are old and vulnerable and unaware exactly what they are buying. In some cases, the funeral plans are sold with misleading promises and to maximise the salesperson's commission.
Demand for funeral plans has grown significantly over recent years and last year over 177,000 plans were sold and cost on average between £2,500 and £5,000. A regulator does currently exist to oversee these plans, which operate on a purely voluntary basis and firms are not required to sign up to the rules. Under new proposals published earlier this month the regulation of the sector would be moved to the Financial Conduct Authority (FCA).
The FCA will seek to ensure that funeral plan providers are clear and fair in their treatment of customers and will also offer access to the Financial Ombudsman Service, enhancing consumer protection. Under the new plans, anyone found breaching the regulations can have their authorisation revoked, face fines and even criminal charges. The consultation on the proposed changes is open for comment until 25 August 2019.