A funeral plan is when you make arrangements for your own funeral and pay for it in advance. A funeral plan is often organised through a local funeral director or by responding to marketing literature received from a national funeral planning company.
There should be two components to arranging a funeral plan:
- Identifying what you want to happen in your funeral.
- Setting aside an appropriate amount of money to pay for it.
The Ethical Funeral Plans Trust was set up to take care of monies that people pay towards their own funeral plans, and ensure that they will grow, over time, in line with inflation.
We don’t provide funeral plans ourselves but look after the money that our funeral directors receive from their funeral plan customers.
The central reason for our existence is to keep the money that you have paid for your own funeral plan safe and secure, and to ensure that the required funds are available at the time of need.
There are quite a lot of organisations that provide Funeral Plans.
However, what makes EFPT distinctive is that we are driven by our commitment to act ethically in everything we do.
As far as we are aware, we are the only Trust committed to all the following:
Having terms and conditions that are clearly expressed and fair
Insisting upon funeral directors operating transparent pricing policies
Banning our funeral directors from using dubious marketing tactics
As far as practical, investing planholders’ monies in ethical funds
Giving surplus funds (after all funeral planholders’ funerals have been paid for) to charities, rather than to directors or trustees
We don’t make ‘bonus’ payments to funeral directors and we don’t pay trustees other than nominal meeting fees and fees for any professional services provided.
We work with a small but increasing number of carefully selected independent funeral directors who share our beliefs and who agree to our terms and conditions.
They must have a fair and transparent pricing policy, and each of the plans that they sell must clearly identify the services that are included.
We also require the funeral directors who work with us to behave ethically in all their dealings with both the public and ourselves.
A list of the funeral directors that we work with can be found via this link.
Firstly, you can rely us to act in an ethical and professional manner to ensure that your money will be well looked after an wisely invested.
This is the sole purpose of the Trust, and the Trustees draw upon professional financial advice to ensure that they achieve it.
The second type of guarantee relates to the cost of carrying out your funeral, whenever it takes place in the future.
The cost of any funeral includes two elements: the funeral director’s costs, and the disbursements (monies paid to third parties like crematoria, celebrants, etc.).
If you have an EFPT plan, whoever is arranging your funeral will not have any additional amount to pay for the funeral director’s costs at the time of the funeral (subject to there being no change in the family’s wishes).
As far as disbursements are concerned, the money that you have included in your plan for these will have grown in line with inflation (see detailed Terms and Conditions) and this amount will be set against the actual costs of these items at the time of your funeral. If the actual cost of the disbursements has grown by more than this, then the difference would be payable by the person organising the funeral. When there is such a balance payable, and in most cases there isn’t one, it will be relatively small in terms of the overall cost of the funeral.
If your funeral director goes out of business at some time in the future, your money is still safe, because the Trust is holding it. So the funds that you have paid in can be used to pay an alternative funeral director at your time of need.
The trustees continually monitor the performance of their investments and check that they meet their liabilities to funeral planholders.
In addition, they take expert advice and ensure there are regular assessments of the Trust made by independent actuaries.
As far as possible, EFPT invests its funds in ethically sound companies and organisations. Examples of funds that are being used now, or have been used in the past, include: Triodos Bank Fixed Interest Account; Alliance Trust UK Ethical Fund; and Rathbone Ethical Bond.
The Trust doesn’t distribute any surpluses that its investments generate to plan sellers, funeral directors, funeral planning company directors, or even the trustees themselves. Any surpluses that do accrue are retained in the fund. We believe that this is prudent and right - investment returns can go down as well as up and our commitments are only to the funeral planholders whose monies we are holding.
If there is a surplus in the Trust when all its commitments to its planholders have been met, the Trust will distribute these monies to children’s charities.