It is no secret that the larger funeral home operators have more preneed options than the industry’s mom and pops. The large operators have the volume of business that will attract insurance companies and banks, and their program incentives and discounts. Economies of scale provide the larger operator preneed advantages when going ‘toe to toe’ with the smaller operator. A completely different ‘have’ and ‘have not’ environment exists within the cemetery industry. One crucial fact distinguishes cemetery preneed from funeral preneed: a burial space, and certain merchandise and services, can be delivered prior to death. That fact is a problem for both insurance companies and banks, and accordingly, neither industry has courted the cemetery industry in the same manner as they have the funeral industry. And, there are other factors which complicate cemetery preneed. Consequently, cemeteries tend to be more ‘have nots’ than ‘haves’. The lack of preneed not only puts the cemetery at a disadvantage with funeral homes when competing for vault and marker sales, the cemetery also runs the risk of losing out completely to cremation.
Over the next months, this blog will examine the state of cemetery preneed, and its regulation. While the cemetery industry, as a whole, has been slower to embrace the preneed transaction than the funeral industry, some cemeteries have aggressive preneed programs. With such a distinct dichotomy within the cemetery industry, regulators must decide whether to spend resources on the few, or for the mass.