Planning and paying for your funeral: prepaid plans and other options

A funeral plan lets you pay for some or all of your funeral costs in advance, either as a lump sum or in monthly instalments. 

Your money is held in a trust or whole-of-life insurance policy (separate from the provider), so it's protected and grows to cover future costs. 

All funeral plan providers must be authorised by the Financial Conduct Authority (FCA)Opens in a new window

Always check the FCA RegisterOpens in a new window to confirm your funeral plan provider is authorised before you commit. 

The cost of a funeral plan can vary depending on:

• what type of funeral and ceremony you want

• the type of coffin

• which provider you choose 

• where you live in the UK.

Funeral plan prices generally range from £1,500 for a direct cremation to £5,000 for a comprehensive burial plan.

Paying upfront is usually cheaper. 

Paying in instalments can add between 15 and 26% to the total cost due to interest and administration fees. 

If you die within two years of starting an instalment plan, some providers will refund what you’ve paid. Others will still cover the full funeral. Always check the terms and conditions before signing up.

All funeral plans include a funeral director to arrange and manage the funeral. What else is included depends on the plan you choose.

Providers typically offer three different types of funeral plans: 

• Basic — usually covers the cost of a direct cremation or burial only or may offer a contribution towards these costs.

• Standard — might provide a limousine for the funeral procession, basic coffin, along with the cover provided by a basic plan. 

• Comprehensive — might provide expensive coffins, limousines for the funeral procession and to transport guests to the funeral, more flexibility in access to view the body in a chapel of rest, and extras.

The table below shows what is typically offered in a standard funeral plan for a burial or a cremation. Be aware, what is covered will vary from provider to provider.

Before deciding whether a funeral plan is right for you, it’s important to consider the benefits and disadvantages of getting one.

Yes, if your provider is FCA-authorised. Your money must be held in a trust or as a whole-of-life policy. You're also protected by:

• The Financial Ombudsman Service (FOS)Opens in a new window — free and impartial complaints resolution

• The Financial Services Compensation Scheme (FSCS)Opens in a new window — which provides compensation or arranges a replacement plan if your provider goes bust.

Be cautious of cold callers claiming to represent authorised firms. Always verify using the number listed on the FCA Register, not one provided by the caller. 

If your provider goes bust, you’ll be moved to a new provider, possibly on different terms. You can reject the new offer and claim a partial refund, though it may be less than you originally paid.

If you’re considering buying a funeral plan, you might want to ask the provider the following questions:

1. Are there any cancellation charges?
2. What exactly is included in the plan and what potential costs aren’t?
3. Is it possible to cancel the plan if circumstances change, for example, if you’ve arranged for your spouse’s funeral but you later separate?
4. Does the plan allow you to choose the funeral director?
5. What if your chosen funeral director goes out of business?
6. What happens if the person the funeral is intended for dies abroad or away from home?
7. Can the funeral director arrange a funeral of a different standard from the one you’ve chosen?
8. If you pay by instalments, how long do you do this for and do you have to pay interest?
9. What happens if there are outstanding instalments when you die?
10. What freedom do you have to change the details of your funeral plan?

Make sure you pick a plan from the list of authorised funeral plan providersOpens in a new window They also have a list of providers that have not been approved to sell funeral plans.

Shop around by comparing providers and plans. Which?Opens in a new window and Fairer FinanceOpens in a new window both offer comparison tools.

Some providers may include commission and administration fees in the final cost. 

Read the terms and conditions carefully. It's important to make sure the details are right or you might not be covered.

Make sure the people you care about know your funeral plan exists and where the documents are stored. A funeral plan nobody knows about is a wasted expense.

If you have a will, your executors will be responsible for arranging your funeral, so it is useful to keep a copy of the plan with your will.

In Scotland, you can name someone to make decisions about your funeral after you die. If you do not name anyone, the law sets out who can take responsibility, starting with your spouse or civil partner, then your partner, children and other relatives. 

If you have a funeral plan, make sure the person who is likely to arrange your funeral knows about it and where the documents are kept. This can help make sure your wishes are followed and avoid delays or confusion. 

If more than one person has the same right to make decisions, for example several children, they should make those decisions together.

If you’re finding it hard to keep up with payments, it’s worth getting in touch with your provider as soon as you can. They have options available to help, such as pausing your payments for a while or putting your existing instalments towards the cost of your funeral. If you stop paying without contacting them, your plan could be cancelled, and you may lose some or all of the money you've paid in

If you cancel, most providers charge a cancellation fee of a few hundred pounds, then refund the remaining balance. You can also leave the balance as a contribution towards your funeral, though it may not keep pace with inflation.. 

A funeral plan isn't the only option. Here are some alternatives to think about before you decide.

• Put money in a savings account — Putting a little money aside each month is one straightforward way to save for a funeral, but funeral costs may rise faster than savings interest rates. Find out why it’s a good idea to save regularly and the saving options available to you in our guide Getting into the savings habit.

• Compare regular life insurance — some policies offer more generous cover than a funeral plan. For more information, see our guide What is life insurance?

• Consider life insurance for over-50s — pays a lump sum on death, but payouts don't always keep up with inflation, and you could pay in more than you get out. Find out how they work and what to watch out for.

• Check death in service employment benefit — some employers pay three to four times your salary to a nominated family member.

• Using money you leave behind in your estate — assets like property or investments can be used, though selling takes time. You can leave instructions for your funeral in a letter of wishes, which is a separate document that sits alongside your will.  Find out more about writing a will in our guide Making a will and planning what to leave.