The Commissioner for Consumer Protection has announced that a new mandatory code of practice is being developed to govern the growing popularity of pre-paid funerals.
The Commissioner, Lanie Chopping said it was currently estimated that $170 million in pre-paid funeral funds were being invested by funeral organisers in Western Australia awaiting the day they were needed.
“Pre-paid funerals allow you to pay in advance for your funeral through a funeral director at today’s prices, either in full or via regular payments,” Ms Chopping said.
Due to take effect on 1 March 2021, the new pre-paid funeral code was aimed at protecting consumers’ money from potential misuse by requiring the funds to be managed within secure investments under the client’s name until they were required.
“Prepaid funeral sellers (who are mostly funeral directors) will be required to forward all payments within 16 days of receipt to specified investment managers in the form of life insurance companies, friendly societies, licensed trustee companies or the Public Trustee of WA,” Ms Chopping said.
“Contracts will be required to detail all the goods and services provided, including the individual cost of each component plus fees.”
She said prices in the contract would be fixed at the time of signing to safeguard against future cost increases and inflation, while a 30-day cooling-off period would also apply.
“Under the code, pre-paid funeral contracts must outline what happens if the organiser’s business becomes insolvent, the client moves interstate or dies before full payment is made, if payments are missed or are late, and under which circumstances a refund is payable,” Ms Chopping said.
“In addition to the code, the Australian Consumer Law provides some protections around the supply of goods and services, including unconscionable or misleading and deceptive conduct, as well as unfair contract terms,” she said.
