Funeral costs in UK
Thinking about funeral costs can feel worrying, but a prepaid funeral plan offers real peace of mind. By paying in advance, you lock in today’s prices and help make sure your loved ones won’t face unexpected bills when they’re already dealing with grief.
As with any big financial decision, it’s normal to question what will happen with your money, and to get reassurances that you won’t be left out of pocket should anything go wrong.
In this guide, you’ll learn how past failures at providers like Safe Hands and Prosperous Life affected families and prompted industry change, what the FCA rules introduced on 29th July 2022 mean for you, how the Financial Services Compensation Scheme (FSCS) protects you if a provider collapses, and how to choose a trustworthy plan provider.
1. What Went Wrong Before Regulation
Before July 2022, funeral plan companies weren’t required to keep customer payments separate or prove financial stability. When firms failed, plans could be cancelled without warning—and money was often lost.
One example is Safe Hands Plans, which entered administration in March 2022, owing around £60 million to 46,000 customers. That money had been invested offshore in high-risk ventures. Administrators expect to recover just £7–£9 million.
Another case, One Life Funeral Planning, had its FCA application rejected in July 2022. With 16,000 customers and no authorisation, it ceased trading and entered liquidation. Plan holders faced delays, confusion, and uncertainty about whether they’d get a refund or replacement plan.
These collapses caused not just financial loss, but emotional stress—funeral delays, urgent borrowing, and paying twice. They highlighted the urgent need for regulation and transparency.
2. FCA Regulation from July 2022
As of 29th July 2022, funeral plans are regulated by the Financial Conduct Authority (FCA). Only FCA-authorised firms may sell or manage plans, and selling without approval is illegal. Plan funds must now be ring-fenced in a trust or insurance-backed account.
Providers must file regular financial reports and treat customers fairly. If something goes wrong, you can complain to the Financial Ombudsman Service—even if the plan was bought before regulation, as long as the firm was previously registered.
The new rules limit mis-selling, increase clarity, and rebuild trust. A 2023 report by Funeral Solution Expert found over two-thirds of consumers felt more confident buying a plan after regulation came into force.
3. Financial Services Compensation Scheme (FSCS) Protection
Since July 2022, plans from FCA-authorised firms are protected by the FSCS. If your provider fails, FSCS can pay up to £85,000 per person, per firm. You may choose a like-for-like plan or receive cash compensation.
The FSCS works with administrators and the FCA to resolve cases quickly, usually without the need to file a claim yourself. A 2023 FSCS poll found 72% of consumers now know their funeral plan is protected—up from 45% in 2021.
Though the damage from Safe Hands and Prosperous Life was severe, regulation today ensures funeral plans are monitored more closely and offer protections similar to other financial products.
4. How to Ensure You’re Making a Sound Investment
Even among regulated providers, due diligence is essential. Confirm your provider is listed on the FCA Register. Only authorised firms may legally offer plans.
Check how your money is held—either in a trust or insured account—to understand how it’s protected. Transparency here is key.
Look for detailed quotes that show what’s included and excluded. Even if your money is secure, it’s important to know what services you’re paying for.
Research the market. Big brand names aren’t always better or more affordable. Smaller providers may offer more competitive prices or better customer service.
Conclusion
Finally, check a provider’s reputation. Look at reviews on Trustpilot or Feefo, how long they’ve been operating, and whether they’ve had complaints or regulatory issues. A clear sales process and good customer service are positive signs.
Thanks to FCA regulation and FSCS protection, prepaid funeral plans today are far more secure. With regulated providers, ring-fenced funds, and up to £85,000 in compensation, you can plan with confidence.
By choosing an FCA-approved, FSCS-protected provider and knowing how your money is managed, you give peace of mind to yourself and your family.
Why not speak to us about the UK’s lowest-priced inclusive direct cremation plan? We independently verify our prices every week against the market, so you can be confident that you’ve secured the best deal available.
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