Prepaid funeral plans
What are prepaid funeral plans and should you buy one?
A prepaid funeral plan lets you pay for your own funeral in advance, potentially saving your family stress and expense when you die. But while things like a coffin and burial or cremation fees are usually covered, prepaid plans don't cover all funeral costs, so you'll need to check what's included before you stump up the cash. This guide helps you compare what's on offer and decide whether you should get one.
With thanks to Simon Cox of Funeral Solution Expert for his contribution to this guide.
What is a prepaid funeral plan?
A prepaid funeral plan allows you to pay for the essential elements of a funeral in advance, either for yourself or for someone else. Plans typically cover many (though not all) of the costs associated with a funeral, such as a coffin and a hearse.
So, if a prepaid plan is in place when you die, those close to you will have less to organise and less to pay towards your funeral. Plans can usually be taken out by anyone aged over 18, though some providers say you need to be at least 50 to buy one. If you want to pay for a plan with monthly instalments, there may also be an upper age limit (often around 80), after which you’d need to pay upfront.
The average cost of a basic funeral is just under £4,000 (which is actually a slight drop on previous years) and one in three UK funerals are now paid for in advance via a prepaid plan. But don't rush into buying one before reading this guide, as they aren't suitable for everyone
Funeral plans are now regulated by the FCA
You now have greater protection when taking out a prepaid funeral plan because, as of 29 July 2022, the sector has been regulated by the Financial Conduct Authority (FCA) – we cover your rights in more detail below.
Prepaid funeral plans: the six need-to-knows
Funeral plans can ease the financial and emotional burden on your family at a distressing time, but they won't be for everyone. Here's what you need to know...
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The big boon of funeral plans is that you pay today's costs, even if funerals are more expensive when you die
If funeral costs rise in future, your funeral plan is protected against inflation. For example, say you buy a funeral plan costing £4,000 today, but don't die for another 15 years. If in that time the cost of everything goes up (which is likely) and now the same funeral costs £6,000, your family won't be asked to pay the £2,000 difference.
However, some costs that are considered to be from a third party (such as cremation fees) may have risen, plus your family might have to pay extra depending on what guarantees were or weren't in the funeral plan contract, so you need to check before taking out a plan.
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It's cheapest if you pay for your plan upfront or over 12 months (if interest-free)
Most funeral plan providers have various payment options. There are typically four:
- Pay the lump sum. If you can afford to do this, it's probably your best bet. That's because: you're only paying for what the plan actually costs; the provider would pay for your funeral if you died tomorrow; and your money is now safe thanks to new regulations.
- Pay over 12 months. This is the next-best option if you don't have the entire lump sum, but can afford to clear the full amount within 12 months. You're usually not charged extra to do this, so in effect you're getting to pay off your plan interest-free for a year. Many plan providers ask for a small deposit (usually less than £100) when setting up a monthly instalment plan but this will be deducted from the total you owe – it's not an extra charge.
The only difference to paying upfront is that if you die within the 12 months and haven't finished paying off the plan, the provider will refund your family what you've paid, rather than provide the funeral. So this means your family will have to organise the funeral, plus they might be out of pocket if costs have risen since you took out the plan.
- Be careful. Spread the cost over up to 25 years. If you don't have the money now, or can't afford to spread the cost over a year, you can choose to spread your payments over a longer period of up to 25 years (depending on the provider). You can usually only do this up to the age of 80(ish), so if you're 75 for example and wanted to pay this way, the maximum length of time you could spread the cost over would likely be five years.
But paying a plan off over multiple years isn't a good option for many as you'll usually be charged interest, so will likely end up paying more than the funeral's worth. The only exception is if you die shortly after two years (or one year in some cases) of taking out your plan, in which case the provider must still pay for your funeral, even if you haven't paid off the plan.
- Avoid. Fixed monthly instalments until you reach 90 or die. Not many of these plans are sold anymore, but here you pay a fixed amount each month (it varies depending on your age) until you die or your 90th birthday, whichever's sooner. Generally, your fixed monthly payments would be lower than paying by the 'up to 25-year' option above, but because you could potentially be paying over a much longer period, overall you'll likely pay much more than the funeral's worth – unless you die earlier than expected.
- Pay the lump sum. If you can afford to do this, it's probably your best bet. That's because: you're only paying for what the plan actually costs; the provider would pay for your funeral if you died tomorrow; and your money is now safe thanks to new regulations.
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A prepaid funeral plan WON'T cover the costs of a burial plot, headstone and more – which can amount to £1,000s extra for your loved ones
Many providers will let you choose between a cremation or burial funeral plan. But watch out for any additional burial or cremation costs that may not be included. For example, the biggest cost unlikely to be covered by a prepaid funeral plan is a burial plot and headstone, which can easily set back your loved ones £1,000s extra (sometimes nearer to £10,000) when you pass away.
Burial funerals typically cost a lot more than cremation services, so the level of burial fees a plan will pay is often capped. If you do choose to buy a funeral plan and want to be buried, your family will therefore likely need to put a significant amount of extra money towards a burial when you die. Cremation fees can be capped too, depending on the plan.
So before you buy a plan, it's VITAL to understand what is and isn't included and make sure you budget for any extras. Unless you're really on a budget, it's better to avoid the very basic plans, as these are usually much more restrictive about the days that your funeral can be held.
What's usually included in a prepaid funeral plan:
- Transport of the body to the funeral directors' location
- Care of the body
- Visiting the body in the chapel of rest
- A coffin, hearse and funeral director personnel
- An allowance towards burial/cremation costs
What's sometimes included depending on the plan:
- A guarantee that crematorium fees will be covered (not capped)
- Doctor's fees (totalling £82 and needed for cremations outside of Scotland)
- Minister's or celebrant's fees
- Limousines for mourners
What's not usually included in a prepaid funeral plan:
- Burial plot (and some burial fees). Cost of a burial plot can range anywhere from £500 all the way up to £3,500 in areas like London.
- Any extra cremation fees. Typical cost up to £1,000.
- Headstone/memorial. Typical cost between £1,000 and £3,000.
- Funeral notices
- Order sheets
- Embalming. Typical cost £150.
- Flowers, catering and other costs for a wake. Typical cost £200+.
As you can see, the additional costs that your loved ones might have to fork out at the time of your passing – even if you've got a funeral plan – can be very expensive.
Paul McLean, of Integrity Funeral Care, who has been a vocal critic of prepaid funeral plans, says it's a common occurrence to find that funeral plans do not cover the entire cost required – leaving loved ones in a difficult financial position at an already very painful time. He advises exploring in detail what is and isn't included in a funeral plan, and making loved ones aware of what hasn't been paid for to reduce the likelihood of nasty surprises.
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Prepaid funeral plans now come with added protection, so your money is safe
From 29 July 2022, the FCA began regulating firms that provide and arrange prepaid funeral plans. This means:
- Your money's safe with an authorised provider. As you'll either get a funeral or you'll get a refund – even if the provider goes bust. That's because funerals paid for in instalments must go ahead even if you die before paying the final instalment. The only exception is if you die within 24 months of purchasing the plan, in which case the provider won't be required to pay for your funeral but must give a full refund.
There are some funeral plan providers, including Co-op and Dignity, which will pay out for a funeral if you die within two years of taking out your plan, as long as you've paid at least the first 12 months of instalments and your payments are up to date.
- You're protected by the Financial Services Compensation Scheme (FSCS) should your plan provider fail. The FSCS can either ensure your funeral contract is carried out as planned, or pay cash compensation.
- If you have a complaint against a funeral plan provider or intermediary, you can refer it to the Financial Ombudsman Service. Escalating a dispute to the ombudsman is free for you to do.
(If the issue happened before 29 July 2022, you'll still be able to refer it to the ombudsman service, but only if the firm was previously registered with the Funeral Planning Authority).
- Your money's safe with an authorised provider. As you'll either get a funeral or you'll get a refund – even if the provider goes bust. That's because funerals paid for in instalments must go ahead even if you die before paying the final instalment. The only exception is if you die within 24 months of purchasing the plan, in which case the provider won't be required to pay for your funeral but must give a full refund.
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If you move home, contact your plan provider to see if you can change to use your new local funeral director
When you buy a funeral plan, you'll need to tell the provider which funeral director you want it to arrange your funeral with. If you later move from the location registered to your plan, you'll need to see if you can change funeral directors. Many plan providers will allow you to, but some may charge a fee to do it. Check the terms of your funeral plan carefully before buying.
Changing your funeral director will also depend on whether your plan provider works with funeral directors in the area you move to. The areas covered vary with providers, so it's worth checking this in any plan you're considering.
Plans also specify how far a funeral director will go to collect a body. The mileage limit can vary, but what counts is whether there's a funeral director willing to take on your plan. Golden Charter, for example, works with a large number of directors so its collection mileage is limited to 25, whereas Co-op directors will go up to 50 miles. Some, such as Plan with Grace, have no limit on the number of miles they'll travel.
Does where I live affect the price of the plan?
A prepaid funeral plan could be good if you live in, or are moving to an expensive area. Some large funeral plan providers have priced their packages, particularly for cremations, to work across big swathes of the UK. So, if you're in a location where funerals are pricey, you could make a saving buying a plan from a national company.
Similarly, if a funeral is in a less expensive area you could lose out with a funeral plan because burial and cremation costs behave in a similar way to property; they're all about location, location, location. If the funeral's going to take place in a less expensive area, you may find it cheaper to go with a small local provider, rather than a company with a national pricing strategy.
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You can save on burial plot costs if you share a family plot or opt for a woodland burial
Burial costs can vary dramatically. Buying a plot can cost just a few hundred pounds in remote rural locations, to £1,000s in cities and over £10,000 in some parts of London. This variation puts them outside plans – although some will permit any spare allowance to go towards the cost of a plot.
Despite recent hikes in crematorium fees, cremations where you choose not to bury the ashes usually work out cheaper than burials because you don't have the same associated costs of buying a plot and paying towards site maintenance. And it's worth noting, you don't actually own a burial plot, it's more of a lease, usually up to 100 years. Then it'll need to be renewed – for a fee.
You can cut burial costs by £100s or £1,000s
- If you don't need to buy a plot because you've already got one, or are prepared to buy one to share, there will then only be £100s to pay for opening a grave. In some circumstances, total costs could work out less than cremations.
- You could choose a plot in a cheaper location. Even though some councils charge £100s more for non-residents, it could still work out cheaper.
- A natural burial or woodland site will be cheaper than a council-owned site, but you'll need to ensure materials used are biodegradable.
- A standard coffin sourced via an undertaker can cost about £350, but you may be able to source a biodegradable one for around £200.
- If you are a member of a mosque or a synagogue, there may be special arrangements.
- If you don't need to buy a plot because you've already got one, or are prepared to buy one to share, there will then only be £100s to pay for opening a grave. In some circumstances, total costs could work out less than cremations.
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Is it worth paying for a funeral plan?
Below we've highlighted when it might – and might not – be a good idea to buy a prepaid funeral plan.
The big unknown is when you'll end up needing to use the plan. But that isn't a reason not to buy one. If you've paid off a plan in full, you know it's there when you need it. While if you die before you've paid off your plan, you'll ether get all your money back, or you'll get the funeral you were paying towards, depending on how soon you die after taking the plan out.
Prepaid funeral plans: when are they worth it?
A prepaid funeral plan is likely to be worth it if... |
You have the cash to pay for one upfront, or you can afford to pay for one over 12 monthly instalments (as long as they're interest-free, as is often the case). |
You think your family would struggle to cope with organising and/or funding your funeral when you die. | |
You're unlikely to have enough money left in your estate to pay for your funeral when you die. | |
Funeral prices increase after you take the plan out (this is likely over the longer-term). | |
You want to be cremated and live in an expensive area, as many plans guarantee cremation costs. | |
It's a GREY AREA if.. |
You take out a plan and then move house within the UK. Many (but not all) providers let you choose an alternative funeral director closer to your new address, but there may be fees involved. |
You're assessed for help towards care costs. If your council thinks you’ve bought a funeral plan to reduce your savings and avoid paying care fees, they may still assess you as if you still had the money. | |
A prepaid funeral plan is unlikely to be worth it if... |
Paying for it puts you in debt. |
The number of years you're paying the plan off over means you end up spending more than the funeral is worth. | |
You plan to move abroad. | |
You agree to pay it off over monthly instalments and then miss one or more payments. | |
You buy a restrictive plan that doesn't give you the funeral you want. | |
Funeral prices fall after you take the plan out (though this is fairly unlikely in the long term). |
How the cost of funeral plans compares to paying direct
It's possible to find a funeral that costs less than a similar plan, so if you think your family will be cool-headed enough to shop around and not succumb to upselling after a loved one has passed away, you may not need to buy a plan.
Bear in mind that the cost will vary considerably depending on where you live, and you'll likely pay more if you opt for a burial over a cremation. According to SunLife's most recent Cost of Dying Report, the total average cost of a burial was £4,794 in 2022, while a cremation was £3,673.
Have a look at funeral prices in your local area and compare that to a few different prepaid plans to get an idea of whether they offer good value for money. But don't underestimate how much it'll be worth to your family to know plans are already in place when you die.
How to buy a funeral plan
Before you start thinking about which provider to go with, you need to think about what sort of funeral you want and the level of plan you want to take out.
A big factor is whether you want a cremation or a burial, as this can have a significant impact on the cost. If you live in an expensive area (or just aren't sure how much a burial or cremation might cost where you live), look for a plan that guarantees the full cost of your burial or cremation will be covered. If you opt for a plan that has a maximum spend limit, your family may end up having to foot the bill if the full cost of your burial or cremation isn't covered.
You then need to decide what's important to you – how long you pay the plan off over, whether you want a specific funeral director or a particular style of coffin, if mourner's limos are important to you, for example. These will all play a part in narrowing down your options.
Here are some key differences between common plan levels, which include a funeral service (unattended direct cremations or burials are usually cheaper still):
- A basic plan can cost anywhere between £2,000 and £3,500 and usually covers transporting and caring for the body, plus disbursements towards officiate fees and the cremation or burial costs. But cheaper plans often mean you're restricted on the time and day of the funeral service and you won't get a mourners' limousine. The coffin is likely to be very basic.
- A standard plan usually costs between £3,000 and £4,000 and gets you a choice of times and day of the week for the funeral, and a generally a better quality coffin, such as a wood effect coffin. You might get one mourners' limousine with some standard plans.
- A higher-level plan is likely to cost more than £4,000 and will include everything from the basic and standard packages, and usually includes at least one (if not two) limousines for mourners to travel in. You can also expect to have a higher-quality coffin, often wood veneer or sometimes even solid wood.
Which plan provider and package should you choose?
Once you've thought about how much you want to spend and what sort of funeral you'd like, you can start comparing plans. But with so many providers and packages available to choose from, knowing where to start can be a challenge.
There are currently 26 funeral plan providers authorised by the Financial Conduct Authority (FCA). Many of these firms have made changes to their plans since the new FCA regulations were introduced in July 2022.
So, we've reviewed the market and found two providers you may want to consider if you're after a burial funeral, and three to bear in mind if you want a cremation. However, do bear in mind:
- We've focused on nationwide providers that work with a large number of funeral directors.
- All providers featured guarantee that full cost of your burial/cremation will be covered.
- The best plan and provider for you will depend on your location, budget and funeral preferences, so always read all the documentation to understand exactly what is and isn't included.
- This is meant as an overview of the plans on offer. As the services will be provided by different funeral directors, we haven't been able to take customer service into account here.
Top prepaid funeral plan providers for burial funerals
(1) After 13 months of up-to-date payments if paying in instalments. (2) After 12 months of up-to-date payments if paying in instalments.
Top prepaid funeral plan providers for cremation funerals
(1) After 13 months of up-to-date payments if paying in instalments. (2) After 24 months of up-to-date payments if paying in instalments. (3). After 12 months of up-to-date payments if paying over five / 10 years. After 24 months of up-to-date payments if paying over more than 10 years.
Want to compare more prepaid funeral providers?

Where can I go for further help?
If you need more help on funerals and their costs, you can get free and impartial guidance from the Government's Money Helper service or Citizens Advice.
You can also turn to FuneralAdvice.org – a consumer-orientated website set up by the National Society of Allied and Independent Funeral Directors in response to the CMA's criticism of the difficulties faced by the public in choosing funeral options.
What are the alternatives to a prepaid funeral plan?

If you don't have a prepaid funeral plan in place when you die, there are a few ways that your funeral could be paid for. These are the main ones:
- Your estate pays. In the first instance, your family should check if there’s enough money left in the estate to pay for your funeral.
- Your family pays. If they have the means, your family might be able to pay for your funeral.
- A public service funeral. If you have no family, or they can't afford to pay for your burial, your local council can arrange a public service funeral – but this is a no-frills option and you won’t have any choice in how, when or where the funeral is carried out.
- Direct cremation/burial. This is a cheaper alternative to a traditional funeral, but no mourners are allowed to be present and there's no funeral service of any kind.
- Help from the state. If you or your partner get certain benefits, you might be eligible for a funeral expenses payment to help pay for some funeral costs, including cremation/burial fees, a doctor's certificate, death certificate and transport costs for the body and for mourners. You might also get up to £1,000 for any other funeral expenses, such as funeral director's fees, flowers or the coffin. How much you get depends on your circumstances.
Prepaid funeral plans Q&A
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