Last updated 14 April 2022

There are numerous pitfalls in negotiating benefits from many of the available funeral funds and plans. The only recourse for persons upset about sharp practices (unethical practices) is contractual and consumer remedies (see the chapter on Consumers and Contracts).

Cash benefit schemes

Under a cash benefit scheme, a sum of money is provided for the funeral upon the death of the beneficiary. Such a scheme may be a benefit of membership of a particular organisation, such as a trade union.

Some cash benefit schemes are organised upon a contributory basis (i.e. the member has to make regular contributions to the scheme). There are several dangers with contribution schemes:

  • non-payment of subscriptions—some schemes will not pay benefits if the member has failed to keep payments to the fund up to date. As a result, years of contributions may be lost and no benefit received from the fund
  • an inability to cash in—there may not be provision for the member to cash in contributions to the fund. In such cases, the only way to receive any benefit from the fund is to die and have the money paid for the funeral
  • the imposition of conditions affecting the disposal of the body—restrictions may be placed upon the payment of the cash benefit if, for example, the recipient of the benefit must be cremated
  • limited entitlement—the benefit that is offered by such a scheme is limited to a set sum. The sum is usually nowhere near enough to pay for a basic funeral.

Non-cash benefit schemes

Under a non-cash benefit scheme, the burial or cremation is performed free for the member of the scheme.

Usually, such schemes are organised and operated by the funeral industry itself. They can be operated upon the basis of a contribution or a once-only payment.

This type of scheme also has pitfalls. They can include:

  • the failure of the funeral company to provide the type of service contracted for by the deceased. Usually, people pay for a certain type of funeral or cremation. When the cost of such a service has risen by the time of death, the funeral company may not provide it. Many companies base their refusal to perform such a service on conditions included in the fine print of the agreement. Such conditions may include:
    • a rise and fall clause—this clause may be included to ensure that the person who desires a certain type of funeral at the time of joining the scheme will have to pay an additional sum, over and above the contributions already made, to receive a funeral of the standard and type originally desired
    • a set cost clause—when the cost of the funeral originally desired has risen by the time of death, it will not be provided. Instead, a funeral that costs the price originally agreed upon will be substituted
  • non-transferability of rights under the scheme
  • unexpected charges by the undertaker if the member dies outside the geographical area in which the undertaker operates
  • the absence of entitlement to cash in the benefit.