Is Great Britain the proverbial “canary in the coal mine” for future U.S. death care purchases?

August 10, 2022/Business, Preneed/

This recent public relations press release indicating that a shift in attitudes of people in Great Britain about how people want to “Say Goodbye” to their loved ones makes one wonder if that shift will find its way across the Atlantic Ocean to the United States.

One report found that “sales of direct cremation plans – a straightforward and affordable alternative to traditional funerals where the deceased is collected, cared for, and then cremated without a service or mourners present – are driving growth in the whole pre-paid funeral plan sector.”

According to the press release, Great Britain’s Pure Cremation company took over the number one position in preneed funeral plan sales for the calendar year 2021. What is interesting about this purported fact is that Pure Cremation is a “Direct Cremation” provider of services.

The press release states that in 2021 the number of pre-paid plans in Great Britain grew by 35% which reversed a four-year trend of declining preneed annual sales in the country. Again, according to the press release, Pure Cremation overtook Co-op Funeralcare and Dignity as #1 in the sector by growing their pre-plan sales four-fold over their 2020 numbers.

A June 2022 survey commissioned by Pure Cremation found that 42% of respondents cited “low cost” as in important factor when planning a funeral. In addition marketing intelligence company Mintel2 mentioned in one of its reports, “With household budgets increasingly coming under strain from rising inflation, cost considerations are likely to come even more to the fore over the coming year.”

Related — As you may know the preneed funeral sales business in Great Britain has been under great scrutiny over the last several years. As of July 29 new rules and regulations have entered the business and the sector finds itself under the rules of the Financial Conduct Authority (FCA) in the country.

The FCA has recently authorized 26 providers of preneed plans in the country. Those 26 providers hold a total of about 1.6 million preneed plans and over 87% of the current market share.

Here are some of the new rules that are now in effect for these 26 providers:

A ban on cold calling.
A ban on commission payments to intermediaries, such as funeral directors.
A requirement for a funeral plan to deliver a funeral unless the customer dies within two years of taking out the plan, in which case a full refund will be offered.

You can read an article entitled “FCA takes over regulation of funeral plans” here

You can read an article entitled “Why a funeral plan should be essential” by Great Britain’s Financial Times here

Tom Anderson
Funeral Director Daily

Funeral Director Daily take: An interesting note I took from the Mintel2 report was this comment:

“The government’s raft of social-distancing measures introduced in March 2020 saw funerals subjected to heavy restrictions to minimize transmission, with caps on attendees persisting into 2021. This saw funeral planning becoming much smaller scale and reduced the average spend, limiting the growth in the sector despite the surging death rates.”

The report also made these points:

47% of all adults agree that the pandemic has made simpler funerals more appealing.
Direct cremations accounted for an estimated 14% of all funerals in 2020, up from just 3% the year before.

Pure Cremation’s business plan of being a “Direct Cremation” only provider seems to have came along at the right time to capitalize on the direct cremation trend in Great Britain.

The question I have moving forward is do we have the same thing happening in the United States? Have circumstances become such that a provider can capitalize on the potential of the American public to see “simpler funerals as more appealing” coupled with the “stress on household incomes” creating faster growth in the Direct Cremation slice of death care options?

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