Preneed: A Pandora's Box of Problems
In contrast to how the IFDA situation was handled, the California Department of Consumer Affairs has taken a public approach to disclosing its issues with the CFDA’s master trust by posting its website an audit report and the Association’s reply.
The DCA is unhappy with the Association, and the master trust fiduciary, with regard…
Several states have passed laws in the past few years mandating greater preneed oversight. But with state budgets in decline after the 2008 market crash, regulators are hard pressed to find a way to pay for consumer protection.
Colorado’s new law simply states that the contract seller shall bear the cost of its examination.
In…
The Comptroller’s Office mailed out letters to funeral homes last week advising how to report the first contribution to the Pre-Need Funeral Consumer Protection Fund. The letter tracks the first few paragraphs of the “Senate Bill 1682 Information” page from the Comptroller’s website.
The funeral home letter includes two documents: a Fee Payment…
Missouri funeral homes will get their first glimpse of their State Board’s proposal for self reporting for preneed sales. Under the prior law, preneed sellers merely reported the number of contracts sold and their aggregate sales price.
For Missouri regulators to properly assess whether ‘old’ Chapter 436 trusts and joint accounts are properly funded, the…
The next round of legislative proposals have been posted to the State Board of Embalmers and Funeral Directors website. At the top of the list is whether the trusting requirement should be raised from 85% to 100%. The proponent believes this will enhance consumer protections. He is not alone.
The Illinois Legislature heard the…
Small town funeral homes often lack the volume of business to warrant a ‘preneed program’. And, if there is no competition, why hassle with the costs of preneed compliance. The short answer is reputation and integrity.
A recent article about an Iowa funeral director suggests the operator may have only handled a hand full of preneed…
The Wall Street Journal has long been viewed as a leading source of business and investment news. But last weekend, the WSJ ran a short article on preneed, and demonstrated its lack of understanding of the transaction.
The article attempts to characterize preneed as an investment, and then explores issues such as cash surrender…
Give the State Board credit for attempting to clarify how insurance assignments must be handled for compliance with Missouri laws.
For several months, the State Board has sought clarifications from MO HealthNet regarding spend-downs. On May 12th, the Board emailed to the industry new MO HealthNet guidelines for insurance assignments. One day later, the legislature…
For more than 20 years, Nebraska preneed sellers have filed an annual report that accounts for the aggregate contributions and distributions from their trust funds. The annual report form also computes the amount of income that must be accrued to the account if the seller elects to withdraw excess income from the trust. In its…
Missouri’s funeral industry has been given 30 days to submit proposals for revisions to the preneed law that went into effect last August 28th. By email, the State Board has provided the guidelines for submitting changes that will then be discussed by the Board at public hearings to be held in June. The Board has…