William Stalter is the founder of Stalter Legal Services and the Preneed Resource Company. Bill focuses his law practice on preneed and death care compliance, serving banks, funeral homes, crematories, and cemeteries. He has written multiple published articles
By Bill Stalter on Posted in Exams/audits,Missouri - SB1In our last post we discussed the need for the Missouri State Board to provide guidance to their financial examiners regarding Section 436.425 and insurance funded contract forms. In this post we will discuss Section 436.425 and trust or joint account funded contracts. Subparagraph 9 has created confusion for examiners and sellers. That section states… Continue Reading
By Bill Stalter on Posted in Compliance,Exams/audits,Missouri - SB1At its April meeting, the Missouri State Board of Embalmers and Funeral Directors discussed the formation of a “Phase 3 Committee” that would provide input for the revision of the Board financial examination handbook. The Board staff is about half way through the second round of preneed examinations (“Phase 2”), and the Board wants to… Continue Reading
By Bill Stalter on Posted in Preneed Tax,TaxesWe continue our discussion of the composite Federal Form 1041QFT with a post about the individual account statement. With the composite return, income and expenses are allocated to the individual preneed account and taxes are computed at that level rather than at the trust level. To allow the IRS to test the composite tax liabilities,… Continue Reading
By Bill Stalter on Posted in Exams/audits,Missouri - SB1The Missouri State Board of Embalmer and Funeral Directors met this past December to discuss changes to the Preneed Examination Handbook, and former Board Chairman Don Lakin made a proposal that has merit. The State Board has licensed approximately 315 preneed sellers. The current preneed examination procedures contemplate an onsite visit to each seller. Many… Continue Reading
By Bill Stalter on Posted in Exams/audits,Missouri - SB1Our next criticism of Missouri’s pending Exam Handbook is its violation of the Four Corners Rule, which requires a document to stand on its own when being interpreted and applied. Common law precludes parties from going to outside sources when applying the document to different situations. While the Handbook gives lip service to the Four Corners… Continue Reading
By Bill Stalter on Posted in Exams/audits,Missouri - SB1,UncategorizedThe newest edition of the Missouri Preneed Exam Handbook has some significant problems. The one we will discuss today is ambiguous instructions regarding the review of preneed contracts. Paragraph 13 of the Handbook’s scope of financial examination states: 13) Staff shall look at 100% of all active preneed contracts that have been sold since the period… Continue Reading
By Bill Stalter on Posted in Exams/audits,Missouri - SB1“Nitpicking” was one of the terms frequently used by Missouri funeral directors when referencing their preneed exam exceptions report. (Other descriptions are not appropriate for print.) The initial exam guideline provided no guidance to examiners for prioritizing problems found in preneed contracts and records. It was common to see exception reports with dozens, even hundreds,… Continue Reading
By Bill Stalter on Posted in Exams/audits,Missouri - SB1The Missouri State Board’s proposed exam handbook would have examiners perform more of their review before an onsite visit is scheduled at the funeral home. By performing a desk top review, the examiner would be better prepared when visiting the funeral home. This should expedite the examination process. There would be four stages to the… Continue Reading
By Bill Stalter on Posted in Exams/audits,Missouri - SB1,RecordkeepingMissouri’s pending preneed exam handbook will establish a new record keeping requirement for the state’s preneed sellers: monthly records of consumer payment receipts and the transmission of those funds to the preneed funding agent. Seller record keeping proposals are not new to the Board. (Missouri Seller Records: The State Board Proposal) The Board’s staff proposed… Continue Reading
By Bill Stalter on Posted in Exams/audits,Missouri - SB1The Missouri State Board’s proposed exam handbook places a new emphasis on tracking consumer payments to funeral homes. There are two elements to the Board’s strategy: confirming the consumer’s funds make it to the appropriate funding agent, and that those funds are remitted to that funding agent within the time periods required by Chapter 436. … Continue Reading
By Bill Stalter on Posted in Exams/audits,Missouri - SB1,Recordkeeping,UncategorizedThe Missouri State Board of Embalmers and Funeral Directors introduced a new preneed examination handbook at its October meeting. (Click the following hyperlink to access the preneed handbook.) The proposed handbook would change the emphasis of the preneed exams from contract and recordkeeping compliance to tracking consumer funds paid to the funeral home. For most… Continue Reading
By Bill Stalter on Posted in Final Expense Trust,Preneed,PreplanningThis section of the New York Time’s funeral planning article attempts to address two separate issues. The issue of what happens when the consumer moves away is one of portability and whether the preneed contract can be transferred to a new funeral home. As we discussed in our first post on the Times article, certain… Continue Reading
By Bill Stalter on Posted in Prepaid Funeral Contract,Preplanning,Transition DocumentsWe’re back to that recent New York Times article about funeral planning. The reporter offers spot on advice about the ‘gaps’ of preneed arrangements. A surviving parent will frequently advise adult children that they need not worry about his (or her) funeral because they have purchased a preneed contract. As the article suggests, adult children… Continue Reading
By Bill Stalter on Posted in Guaranteed,Non-guaranteed,Preneed,Prepaid Funeral Contract,Transition DocumentsEarlier this year, the New York Times ran a story that on funeral planning that raised several valid issues and recommendations. We will use the next few blog posts to explore certain issues and recommendations in greater detail. With this post we will start with the article’s discussion of prepaying for a preneed contract, and… Continue Reading
By Bill Stalter on Posted in Exams/audits,Missouri - SB1The rift between the Missouri State Board of Embalmers and Funeral Directors and their Executive Director culminated in her resignation effective June 30th. Over the course of the past several years, the State Board drew the ire of the industry in a number of ways. The staff implemented regulation proposals before they were officially promulgated,… Continue Reading
By Bill Stalter on Posted in Exams/audits,Missouri - SB1,UncategorizedOur first recommendation to the Missouri State Board of Embalmers and Funeral Directors is that they assume, and maintain, control over the preneed examination procedures. The exam procedures implemented two years ago were never submitted to the Board for review and approval. Accordingly, the examination procedures handbook should remind the staff that any change made… Continue Reading
By Bill Stalter on Posted in Exams/audits,Missouri - SB1With an action that caught some by surprise, the Missouri State Board of Embalmers and Funeral Directors voted to suspend future preneed examinations and accept recommendations on a new process. We have made several posts on the faults of the Missouri examination process, and now commend the Board on taking a bold action. The Missouri… Continue Reading
By Bill Stalter on Posted in Exams/audits,Missouri - SB1To begin reform of its preneed exam process, the Missouri State Board of Embalmers and Funeral Directors is seeking input from the industry by this Friday, June 8th. Specifically, the State Board is requesting comments to the Exam Procedures Handbook prepared by its staff. We have made edits to that handbook, and will provide more… Continue Reading
By Bill Stalter on Posted in Price Protection,UncategorizedIt only took 15 months, but the Missouri State Board finally approved a rule to clarify what fees a preneed seller may charge when offering a guaranteed price contract to consumers. Low investment returns from insurance and trusts forced many funeral homes to stop offering guaranteed price contracts to consumers. Funeral homes’ cost increases were… Continue Reading
By Bill Stalter on Posted in Missouri - SB1Another welcomed change made by the State Board on April 25th was to approve an extension on the filing of annual reports. Missouri has one of the shortest periods (60 days) for filing a preneed annual report. Neighboring states not only granted more time (Illinois 75 days, Iowa 105 days and Nebraska 150 days), they… Continue Reading
By Bill Stalter on Posted in Missouri - SB1,UncategorizedAt its April 25th meeting, the Missouri State Board unwound two controversial staff proposals: mandatory consumer disclosures for preneed contracts and the formation of an insurance funded contract. With 20 CSR 2120-3.205 , the Board staff sought to require Missouri preneed sellers to provide consumers with a two page list of disclosures. Those disclosures proved… Continue Reading
By Bill Stalter on Posted in Exams/audits,Missouri - SB1The April 25th meeting of the Missouri State Board of Embalmers and Funeral Directors marked an important transition where industry members assumed control over the protection of consumers’ preneed funds. After the first round of financial examinations, the Board’s procedures for the second round were defined by the Board’s staff, and never submitted to the… Continue Reading
By Bill Stalter on Posted in Compliance,Exams/audits,Missouri - SB1Ten years after the collapse of NPS, the Missouri State Board of Embalmers and Funeral Directors has a confidence problem with licensees and legislators. Licensees see a regulator that is obsessed with DBAs, renewal reports, and exams that focus on contract provisions. Legislators see a regulator that will not fulfill the SB1 mandate to protect… Continue Reading
By Bill Stalter on Posted in Compliance,Exams/audits,Missouri - SB1The latest rumor being spread about the Missouri State Board of Embalmers and Funeral Directors is that the Board members met in a closed executive session without staff or attorneys to discuss the need for change in the legal representation of the Board. According to the rumor, the decision was made to send the Board… Continue Reading
