Preneed: A Pandora's Box of Problems
The question isn’t whether preneed needs to change, but how to change it.
The November 2nd edition of the Funeral Insider highlights a new industry survey by Citrin Cooperman, a highly regarded accounting firm. The newsletter includes a section on preneed, and experts’ take on the survey. Their consensus is that preneed is broken.
With the upcoming new year, Illinois smaller funeral homes will begin searching for a corporate trustee for their preneed funds. With the Legislature’s approval of the Governor’s Amendatory Veto of SB1682, funeral directors lose the authority to serve as fiduciary of their own preneed funds.
The anxiety over Missouri’s new preneed law will temporarily peak this Friday with the passing of the due dates for annual reports and license applications. To give the industry a breather, and to assess SB1’s flaws, the Missouri State Board of Embalmers and Funeral Directors reached an informal agreement on October 20th to table any…
Death care regulators seem to believe that the majority of funeral home and cemetery operators are honest and well intended. But, the regulators must contend with the occasional operator who views trust funds as their own. Before taking offense with the regulator’s skepticism, operators need to reflect on the arrogance of operators such as those reflected in a…
Like most states’ preneed laws, Missouri’s Chapter 436 has always contemplated a depository accounts for the small funeral operator who provides preneed as an accommodation. Many funeral homes do not sell enough preneed to warrant the expense and hassle of either a trust or an insurance license. Chapter 436 allows the funeral director to place…
The old axiom was that it would take three consecutive legislative sessions to get a preneed bill passed. If Missouri and Illinois are indicators of the current preneed reform movement, the charm may be based not on attempts but actual bills passed by the legislature.
The Illinois Comptroller’s proposal for preneed reform, SB1682, is progressing…
Taxpayers, through their local governments, have always borne some of the cost of death care. Taxes go toward the maintenance of abandoned cemeteries and the final disposition of the indigent. But as the New York Times reports, the economy is causing more families to abandon the care of their dead to local governments. While many…
The funeral director’s decision about how to fund his preneed is influenced by the state’s trusting requirement, investment returns, administrative convenience and the volume of preneed business. Essentially, there are three methods of funding preneed: the depository account, the master trust and the insurance policy.
The funeral director’s use of the depository account predates all…
The emergency rule that implements Missouri’s $36 per contract fee becomes ‘official’ on October 4th. Missouri funeral directors question whether the fee is too high, and whether it will contribute to the decline in preneed sales. The analysis required for the emergency rule reports that the fee is expected to generate $612,000 of revenues that will…