Customers who hold pre-paid funeral plans with Tamworth Co-operative Society are being assured their money is secure.
The Financial Conduct Authority (FCA) will be regulating all funeral plan providers from 29 July 2022. Any company wishing to offer funeral plans from that date must be authorised by the FCA.
The reassurance follows news that Safe Hands, a UK-based funeral plan provider, has gone into administration. Safe Hands recently withdrew its application to the FCA to be authorised as a funeral plan provider, leaving customers wondering how they will be affected.
There has been speculation that other funeral plan providers could follow suit.
However, Glen Speak, general manager of Tamworth Co-op’s funeral service, says its plan holders have nothing to fear.
He said: “We appreciate recent press reports might have caused some anxiety, but we did not offer Safe Hands products. In addition we are making new arrangements to ensure our customers’ money and benefits will continue to be secure.”
More than 2,000 letters are to be sent out to Tamworth Co-op plan holders notifying them that their plans will be transferred to Ecclesiastical Planning Services.
“The cost of authorisation, in terms of both initial registration and of maintaining compliance, is excessive for a co-operative the size of Tamworth,” added Mr Speak.
“We therefore decided our best option would be to partner with a larger organisation that has a strong knowledge of financial services regulation.
“Our plan holders’ money will still be held by Royal London Insurance Society as it is now, but in future the plans will be provided by Ecclesiastical Planning Services. It is one of the most trusted names in the industry and is currently going through the authorisation process.
“It was founded in 1887 and is part of the Benefact Group. As the fourth largest corporate donor to charity in the UK, the group gives available profits to good causes. As a co-operative we share similar values, so this link-up makes a lot of sense.”
Although the transfer will not negatively impact existing plans, Mr Speak said Tamworth Co-op customers can also opt to have the original amount they paid refunded.
Chris Clark, Managing Director of Ecclesiastical Planning Services, has confirmed that its application for FCA authorisation is in progress.
“We are supporting a number of funeral plan providers that do not intend to become authorised by the FCA and wish to make suitable arrangements for their existing funeral plans,” he said.
“Whilst statutory regulation under the remit of the FCA may prove challenging for some providers, our view remains that standards will be raised. We welcome the new regulation and the extra protection that it will provide for funeral plan customers. We remain positive about the prospect of authorisation.”
Mr Clark also welcomed the partnership with Tamworth Co-op.
“Glen Speak and his team have many years of experience, and are dedicated to helping make funeral services unique, reflecting personal wishes. Tamworth Co-operative Society is also a member of the National Association of Funeral Directors and adheres to its code of practice.
“Many people want to help their family, both financially and emotionally, by planning their funeral in advance. This secures the funeral costs and alleviates the financial burden for loved ones at an already difficult time. Families often find it hard to make decisions on what their loved one would have wanted in their funeral service, and a pre-paid funeral plan removes this worry. We are delighted to be partnering with the Tamworth Co-op.”
