Co-Operative Funeral Plans....safe?

sleepymans

Bearing in mind recent publicity about the parlous state of the Co-Op's financial situation, how secure is the Co-Op funeral plan my elderly Mum bought about 5 years ago?


To be honest, OH and I were planning to buy one each as soon as we retire (I know, nothing like planning ahead, is there?


So what do others think about the risks of buying such plans and subsequently losing the money?

Crabapple

I don't know. But the policies must be underwritten so it would be unlikely that money would be lost.

Plus with the Co-op as they also have a large funeral business I would have thought they would be pretty safe.

Co-op have been writing to customers (certainly the banking ones) assuring them that their money is safe, if that helps!

bongonaut

Generally, the position with proper pre-paid funeral plans is that your money is invested by the provider in either a Trust Fund or a whole of life insurance policy. The plan purchaser is then guaranteed that the plan will pay for items specified in the plan at the time of need. If the investment has not performed, then it is the funeral director (in this case the Co-op's own) who will carry the shortfall.
It may be that there are additional items outside of the plan that will need to be paid for, but I don't think you have too much to worry about.
If you & OH are considering a plan, do shop around. Have a chat with any particular FD you would want to use. Do make sure that the plan provider is registered with the Funeral Planning Authority (FPA).

calreid

Has anyone any experience of the Golden Charter pre-paid funeral plans?

Is your money safe against the FD going out of business?

Mojisola

calreid wrote: »

Has anyone any experience of the Golden Charter pre-paid funeral plans?

Is your money safe against the FD going out of business?

They are listed here -
https://www.funeralplanningauthority.com/providers.html

Golden Charter don't guarantee to cover cremation costs like some other companies -
https://www.which.co.uk/money/insurance/reviews-ns/funeral-plans/the-costs-of-funeral-plans/

bongonaut

With GC plans your money is held in a Trust Fund which is a legally separate entity from their company, or it is used to purchase appropriate life insurance to cover the payout. Therefore if your selected FD goes out of business, your money is safe in the Trust and GC will help you to appoint a different FD.

Some GC plans do guarantee basic 3rd party costs, and some don't, so it is worth checking. The guarantee is actually given by the FD and not by GC. Even though another plan provider might say they guarantee crem fees etc, it wouldn't automatically follow that the FD of your choice would accept the plan if you didn't buy it directly from that FD. It's therefore often a good idea to speak to any specific FD you would like to use in the first instance.

Mojisola's previous post gives the website of the Funeral Planning Authority which does provide valuable info.

Mojisola

bongonaut wrote: »

Some GC plans do guarantee basic 3rd party costs, and some don't, so it is worth checking. The guarantee is actually given by the FD and not by GC. Even though another plan provider might say they guarantee crem fees etc, it wouldn't automatically follow that the FD of your choice would accept the plan if you didn't buy it directly from that FD. It's therefore often a good idea to speak to any specific FD you would like to use in the first instance..

The AgeUK funeral plans my parents had didn't work like this. The terms were set out when the plan was bought. AgeUK sign up a local FD who works within the guaranteed terms of the plan and you have to use that firm.

The FD who was providing the funerals for AgeUK changed between the time my parents took out the plan and their deaths. If you want a particular FD to manage the funeral, that would be something to check before signing up.

maggieann2luke

My Mother in Law had a Co-op funeral plan paid up. She died a fortnight ago and we found out we could only use Co-op FD and her plan only covered her coffin, hearse and church service. We will be paying other necessities ourselves then sort it out from her estate later.

Mojisola

maggieann2luke wrote: »

My Mother in Law had a Co-op funeral plan paid up. She died a fortnight ago and we found out we could only use Co-op FD

Wouldn't that be a given?

maggieann2luke

We only found out about this after she died and we were starting to organise things. The plan did not include grave digging but did pay for the burial. We are paying for the grave digging then will sort it from her estate later.