What Is Pre-Need Funeral Contract? Definition

Why it matters

These plans can lock in some choices and relieve family decisions later, but terms vary. Ask whether prices are guaranteed, whether the plan transfers if you move, and what happens if the funeral home closes. Ask about refunds if you cancel. State laws govern how funds are held. The FTC Funeral Rule applies to pre-need arrangements, so you should receive a price list. Compare with other ways to pay.

Source: ftc.gov

Where we use this term

Burial insurance: is it different from final expense, and is it worth it?

Related terms

Funeral Trust: A funeral trust is an arrangement in which money is set aside with a trustee to pay for funeral costs later. State law sets rules for how the funds are held and used.
Pre-Need Insurance: Pre-need insurance is a policy or contract sold through a funeral home to pay for specific funeral goods and services chosen in advance. The benefit usually goes to the funeral provider, not to the family.
Funeral Costs: Funeral costs are the expenses for a funeral or other final arrangements, such as services, a casket or urn, a burial plot or cremation, and transport. Prices vary widely by provider and location.
Assignment of Benefits: Assignment of benefits is a written transfer of the right to receive policy proceeds to another party. In funeral planning, the owner may assign proceeds to a funeral home to pay the bill.
Burial Insurance: Burial insurance is a common name for small whole life policies that pay for burial, funeral, and related costs. The term is used the same way as final expense insurance. The benefit goes to a named beneficiary.

All 241 terms

Why it matters

Where we use this term

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