Funeral costs fall for first time in 17 years

According to SunLife’s annual Cost of Dying report, the cost of a basic funeral fell to £4,056 in 2021

A stone cross marks the site of an ancient tomb at the foot of a tree and covered by tall grass. In the background, there are other patinated stone crosses lost in the vegetation.

Photograph taken at Brompton Cemetery, London, UK. 

Brompton Cemetery is one of the Magnificent Seven Cemeteries, a set of 19th-century London landscape cemeteries.

The cost of the average funeral has gone down for the first time since 2004, with funeral services having changed drastically because of the pandemic.

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According to SunLife’s annual Cost of Dying report, the cost of a basic funeral fell to £4,056 in 2021, down 3.1% since 2020 and the first time that costs have fallen since the insurer began its research 17 years ago.

Although the cost of a basic funeral may have dropped, the most affordable type of funeral – a direct cremation – has risen in cost to £1,647, an increase of 6% compared to 2020. A direct cremation is a cremation without a service, and remains are either returned to a loved one, or scattered in a remembrance garden at the crematorium.

Between February 2020 and July 2021, 24% of funerals were direct cremations, six percentage points higher than the national average during the last four years.

Mark Screeton, chief executive at SunLife, said: “With government restrictions limiting the kind of send-off we give our loved ones for much of the year, this drop in cost doesn’t come as a surprise. Neither does the rise in direct cremations, which were often the most practical service available during the pandemic.”

Growing numbers of people who’ve decided to pay for their funerals in advance are choosing direct cremations to keep costs down too. According to pre-paid funeral plan comparison site Funeralplanmarket.com, the number of people opting for a direct cremation when they took out a pre-paid funeral plan last year doubled to 79% compared to the previous 12 months.

Sally Howarth, of Funeralplanmarket.com, said: “Our view is that the dramatic increase has been caused by the pandemic making people want to spend their money on living rather than dying.

“Yes, a percentage of our customers will doubtless be feeling the cost of living squeeze but overall the pandemic has been a wake-up call about the importance of enjoying life while it lasts. The reduced premiums that come with direct cremations mean people have more to spend on things that they can enjoy today.”

New protections for funeral plan customers
New rules are due to come into effect this summer that will provide greater protection for consumers choosing to take out pre-paid funeral plans to cover funeral costs.

Free guide to funeral plans

The new rules will mean that from 29 July 2022 onwards, funeral plan customers will be able to make a complaint to the Financial Ombudsman Service, and will also have protection from the Financial Services Compensation Scheme (FSCS) should their provider fail. Cold calling will be banned from the same date, along with commission payment to intermediaries.

Sheldon Mills, Executive Director, Consumers and Competition at the financial regulator the Financial Conduct Authority, said: “Funeral plans should provide customers with comfort and certainty that their affairs are in order.

“Consumers thinking of purchasing a pre-paid funeral plan before regulation should look into their options carefully to decide whether it’s the right product for them. Consumers should be sure they understand what their plan does and doesn’t provide before they pay, and whether there are extra charges applicable.”

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