Funeral plans: how they work, and what protects your money
Updated 14 October 2026. Figures checked against official sources on 14 October 2026.
A funeral plan is a funeral paid for in advance. Since 29 July 2022 every funeral plan provider has to be authorised by the Financial Conduct Authority.
Worked example: someone aged 72 spending £25,000 a year. Your money lasts to 95, with £48,582 left.
Worked example
Your money lasts to 95, with £48,582 left.
- Age now
- 72
- Retire at
- 72
- Pots
- £300,000
- Take-home wanted
- £25,000 a year
- Plan until
- 95
What protects your money
| Protection | With an authorised provider |
|---|---|
| If the provider goes bust | The Financial Services Compensation Scheme can step in |
| If you need to complain | The Financial Ombudsman Service |
| Cold calling | Banned |
| Commission to funeral directors | Banned |
| Paying by instalments | The plan must deliver the funeral, or give a full refund if the person dies within two years of taking it out |
Without authorisation there's no ombudsman and no compensation scheme. Check the provider on the FCA's Firm Checker before paying.
What to check a plan includes
- Collection, and from where: hospital, home or care home, day or night.
- A service, or a direct cremation with nobody attending.
- Whether the crematorium or burial fee is fully covered, or only partly.
- Whether the price is fixed, or more may be due later.
- If paying by instalments, how long they last.
Plan or savings
| Funeral plan | Money kept in savings | |
|---|---|---|
| Price | Set when you buy (check what's fixed) | Whatever the funeral costs at the time |
| Your money | Paid to the provider | Stays yours, earns interest |
| If the provider fails | Covered by the compensation scheme, if authorised | Bank savings are protected up to the scheme's limit |
Questions people ask
Are funeral plans regulated?
Yes. Since 29 July 2022 funeral plan providers have to be authorised by the Financial Conduct Authority. Check a provider on the FCA's Firm Checker before paying.
What happens if a funeral plan provider goes bust?
With an authorised provider, the Financial Services Compensation Scheme can step in. Without authorisation there's no compensation scheme and no ombudsman to complain to.
Is cold calling about funeral plans allowed?
No. Cold calling about funeral plans has been banned since 29 July 2022, along with commission paid to funeral directors and other go-betweens.
Sources
Rates and rules were checked against these on 14 October 2026. Worked-example figures come from the calculator, using 2026/27 tax rules.