How to compare funeral directors · Page 3 of 6

A prepaid funeral, from both ends

A prepaid funeral is a contract with a funeral director for a funeral chosen now and paid for in advance, at the current price, in one sum or in instalments. Comparing two plans means reading what each one fixes and what it leaves out; using one, later, means the family finding the contract and knowing what it already covers.

General information, not legal or financial advice. A prepaid funeral is not funeral insurance, which is regulated by the Commonwealth through ASIC and APRA; Moneysmart’s funeral insurance page covers that. The NSW Government suggests seeking independent legal or financial advice if you have concerns about a prepaid arrangement.

Before signing

Setting two plans side by side

The total on a prepaid plan only means something next to what it covers. The rules in four states point to the same handful of things to set side by side.

What the plan should spell out

  • Each part and its cost. In NSW, the business must tell you each component of the contract and its cost before you agree, and the services the contract does not cover. In Western Australia, the contract must show the total cost including GST, itemise each component, and give any fees and how the contract can be ended.
  • The service and the goods. A Victorian contract must be in writing and name the funeral service, any goods supplied with it and the total cost.
  • Where the money goes. Ask each plan who will hold the money, so the two can be checked by name. In Western Australia you must be given the investment manager’s own information, such as a product disclosure statement.
  • The paperwork. The Queensland Government suggests asking for a copy of the contract before you sign and taking it away to consider. With two plans, that gives you two contracts to read side by side.

What it may leave out

  • The burial or cremation. Check whether each plan includes it. The NSW Government warns that a director’s scheme might not.
  • The place itself. A grave plot, a niche in a wall or a place in a memorial garden can be prepaid too, and is typically bought directly from a cemetery or crematorium.
  • Cemetery time already paid. In Perth, the Metropolitan Cemeteries Board notes that some prepaid packages already include time in one of its chapels, so you may not need to pay for a director’s chapel as well.
  • Extras added later. In Western Australia, adding services after the person has died adds to the cost.

Drawn from the NSW Government, Consumer Affairs Victoria, the Queensland Government, WA Consumer Protection and the Metropolitan Cemeteries Board, each linked where it is used. Each point is that state’s rule or advice, not a national one.

The Queensland Government also says not to be rushed into signing, and to seek advice from a lawyer or financial adviser and talk to family and friends.

While it waits

Check the fund by name

Each state sets its own rules on where prepaid money must be held and on cooling-off, and its own page is the place to read them: NSW Government, Consumer Affairs Victoria, Queensland Government and WA Consumer Protection. When comparing two plans, the useful habit is to ask each one to name the fund or investment manager that will hold the money, and then check that name.

In NSW that check is easy. All pre-paid and contributory funeral funds must be registered with NSW Fair Trading, and the NSW Government’s guide lists the registered funds by name. In Western Australia, the contract itself must name the investment manager.

When the time comes

Using a prepaid funeral

  1. Find out whether there is one

    The first step in the NSW Government’s guide is a search: did the person arrange their funeral in advance, or buy a grave site? Their papers at home and their will are the places to look. WA’s rules below apply to contracts made since 1 March 2021. In Western Australia the search may be shorter, because a copy of the signed contract must go to the person it covers, the person who arranged it, and their next of kin or the executor of their will. The contract also names a contact person, usually the next of kin or executor, and the selected funeral director where a funeral broker arranged it.

  2. Read what the price already covers

    In Western Australia, once the person has died, their legal representative can agree to a change to the contract, such as adding a service. In Victoria, a provider must not ask for further prepayments or other amounts that the contract does not set out, and must not demand any payment for the funeral service beyond what the contract provides.

  3. Compare what is not covered

    Anything outside the contract, such as a cemetery fee the plan never included, or an extra the family chooses, is bought in the ordinary way, and the comparison in two quotes, side by side applies to it. In WA, extras added after death add to the cost.

  4. When the director has closed

    In Western Australia, every prepaid contract made since 1 March 2021 must say what happens to the money if the business closes, including through bankruptcy or insolvency. In NSW, the registered fund that holds the money must be separate from the funeral director company. Either way, the contract and the fund’s details are where the answer starts.

  5. When the money is released

    In Victoria, a provider must not accept money from the investment named in a prepaid contract unless it has supplied the funeral service as the contract says.

If it is not what was agreed

When a plan goes wrong

WA Consumer Protection suggests talking to a financial counsellor, a free service, about problems with a prepaid funeral product, and says you can contact Consumer Protection as well. For a complaint about the funeral director itself, in any state, complaints about a funeral director sets out the order to take it in. Questions to ask includes two for a family holding a prepaid plan.