Prepaid funeral plans
Planning and prepaying for your funeral and burial arrangements
helps ensure that your wishes are honored, and relieves loved ones who are
grieving from having to plan and pay for a funeral.
Will I use a funeral plan?
A funeral plan is almost guaranteed to be used - the question is when.
If you plan and prepay for your funeral, it is important to let loved
ones know where to find detailed information, including the funeral home
where you planned and prepaid, otherwise family members may make new arrangements.
How can I prepay for my funeral?
You can preplan your funeral and burial without paying in advance, but
many people choose to prepay the expenses ahead of time. Contact several
locations to compare prices and understand your planning and pricing options.
Normally there are three ways to pay for a funeral ahead
A trust account set up by an authorized funeral home or cemetery.
A life insurance policy with your own licensed agency or a licensed
agent working with the funeral home or cemetery.
Funds set aside in a personal bank account that a loved one can access
to pay for a funeral.
Whichever method you use, remember to tell loved ones about the existence
of the prepaid policy or account.
Funeral contractsthe total cost,
the payment plan (if applicable), and method of payment
(trust or insurance)
an itemized listing of the funeral or burial service
and/or merchandise provided (casket, headstone, etc.),
guaranteed and non-guaranteed services and items; and
Once you have made your plan, you will receive a contract addressing important
The contract should tell how and where you will receive
funeral services. Make sure that each service you want is listed.
Can I get my money back if I change
If you establish a revocable prepaid contract funded with a trust, you
can withdraw the principal and accrued interest at any time. However,
if you establish an irrevocable agreement, you cannot withdraw any principal
or interest, or cancel the contract. If you are applying for Medicaid,
or other public assistance, an irrevocable trust would not be counted
toward your assets.
If you're healthy enough to purchase regular life insurance, the policy
could take care of your funeral costs. Some people who are unable to qualify
for a life insurance policy, however, buy a "small-face" or
"pre-need" type of life insurance that is designed to cover
their funeral costs.
Here are some factors to consider with these funeral
They may not pay if you die within a couple years of buying
It's a good idea to calculate how much you will pay in premiums compared
to what the policy will pay out. Are you better off saving on your own?
If the price of the funeral you want goes up significantly, will your
policy only cover a flat amount?
Life insurance should be purchased through a licensed
insurance agent. Some funeral service providers in Oregon encourage people
to buy life insurance policies with the funeral service provider named
There is no such thing as "funeral insurance"
that covers all possible expenses surrounding death and burial. Some consumers
buy expensive funeral policies that provide minimal services.
Switching from a trust to life insuranceWhy is this change being proposed?
Can I change the policy beneficiary if I move or want
to change funeral providers?
Will I get full value if I cancel the policy early?
How much will the funeral provider receive for moving
my funds from a trust account to an insurance policy?
How much commission will the insurance agent receive
for the sale?
What are the tax implications?
Do I have to prepay my funeral?
If your funeral plan provider tells you to switch from a traditional funeral
trust plan to life insurance, ask:
What should I be concerned about?Trusts contracts: The Oregon Division of Finance
and Corporate Securities certifies funeral homes and cemeteries that sell
contracts to prepay your funeral involving a trust. The division's financial
services examiners can provide a list of certified providers and answer
any questions about trusts.
Insurance: The Oregon Insurance Division licenses
insurance agents. Its consumer advocates can answer questions you might
have about whether an agent is licensed or how a funeral (life insurance)
policy might work.
Although there are many honest and reputable people and companies that offer
preneed funeral planning and prepaid contracts, there are unscrupulous con
artists who sell overpriced plans or simply take your money. Ask to see
a valid business license.
What laws protect me?Buy only the funeral arrangements you want. You have
the right to buy separate goods (such as caskets) and services (such as
embalming or a memorial service). You do not have to accept a package
that may include items you do not want.
The Funeral Rule, enforced by the Federal Trade Commission, ensures that
While federal and state law doesn't require the use
of an outer burial container (to surround the casket or urn), many cemeteries
" Get price information on the telephone. You don't
have to give them your name, address, or telephone number first. Although
they are not required to do so, many funeral homes mail their price lists,
and some post them online.
Learn more here.