Funerals

(asked on 17th January 2018) - View Source

Question to the HM Treasury:

To ask Mr Chancellor of the Exchequer, what representations he has received on strengthening the regulation of the funeral plan market.


Answered by
John Glen Portrait
John Glen
Paymaster General and Minister for the Cabinet Office
This question was answered on 24th January 2018

The provision of a funeral plan is defined as a regulated activity and falls within the Financial Conduct Authority’s regulatory remit unless specific exemption criteria are met. This arrangement and these exemption criteria are set out in the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001.

This legislation exempts funeral plan providers from the Financial Conduct Authority’s regulatory remit where the following financial arrangements are conducted, which are designed to ensure that the customer’s payments are secure:

    1. the customer’s money is held in a trust fund, where more than half of the trustees are unconnected with the funeral plan provider. This trust must be managed by an authorised fund manager and be overseen by a Fellow of the Institute and Faculty of Actuaries; or

    2. the customer’s money is placed in a life insurance policy, issued by an authorised insurer.

      HM Treasury sets the legislative framework for the regulation of financial services, including the provision of funeral plans, and continues to keep such exemptions under review to ensure the maintenance of effective prudential and conduct standards.

      HM Treasury regularly engages with external stakeholders and has heard views relating to the funeral plan market from a range of sources, including consumer groups and funeral plan providers.

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