Drew Callingham, director of Oak Circle Accounting, looks at how funeral businesses can continue offering trusted pre-need services while adapting to regulatory expectations.

“Pre-need funeral plans offer comfort to families and long-term value to firms. Since the Financial Conduct Authority (FCA) took over regulation in July 2022, the stakes have shifted. Funeral firms must now adapt in response. What was once seen as a cashflow buffer or a loyalty driver is now a regulated financial product, with all the compliance obligations and risks that entails.

The first is financial: delivering tomorrow’s service at yesterday’s prices. Many older plans were sold under guarantees that are now unsustainable – especially where firms committed to covering rising third-party costs in full. Inflation in cremation, burial, and energy costs has outpaced even the best-intentioned actuarial forecasts. Without active portfolio reviews, what looks like secured future revenue may actually be a string of unprofitable obligations.

The second is operational, particularly for firms managing legacy plans outside the scope of an FCA-authorised provider. The FCA now requires clear disclosures, complaint handling protocols, records retention and fit-for-purpose systems. If you’re administering plans yourself, even informally, you may fall foul of new standards and face sanctions without being absolutely clear on their regulatory position.

The third is reputational. Families now expect seamless service delivery, regardless of who originally sold the plan. Unclear records, mismatched expectations or admin delays can all damage trust, and that damage extends far beyond a single case. In this trust-led industry, consistency and compassion are everything.

There is still real value in pre-need – when plans are written with clarity, priced realistically and reviewed routinely, but they are not a ‘set-and-forget’ asset. Every funeral director should be asking:

• Who underwrites our plans, and are they FCA authorised?

• Are we making any representations that could be construed as regulated advice?

• What controls do we have around plan fulfilment, pricing drift, and cost coverage?

The bottom line: pre-need is no longer a simple sale. It’s a regulated commitment with long-term financial and reputational consequences. Managing it well isn’t just good practice – it’s now a matter of legal compliance and business survival.”

For more information, email drew@oakcircle.co.uk