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Death Care Law
Is it time to put a price on the guaranteed option that your funeral home offers? The Preneed Resource Company is now offering the administration, documents and compliance required for a trust funded price protection program.  For the past ten years, preneed investment returns have not kept pace with funeral operation costs.  Funeral homes have also been forced by state regulators to absorb losses from non-compliant preneed programs.  Preneed shortfalls have left many funeral homes in an economic bind, and they can no longer afford to charge today’s prices for a funeral that may not be performed for 10 years, maybe 20 years.    For funeral homes needing a way out of their preneed pit, PRC’s Price Protection Program provides mutual benefits for both the funeral home and their families.  In contrast to some insurance funded inflation protection programs, the consumer never pays more than the cost of the funeral arrangement at the time of need.  With insurance based programs, families may pay hundreds, even thousands, of dollars more than the at-need cost of the funeral.  That’s profit protection for the insurance company, not price protection for the consumer.  Higher preneed costs to families mean more cremations, and fewer traditional funerals, for the funeral home.  Insurance based programs require families to purchase 10 to 20% more coverage than what the funeral costs today.  If this should result in excess insurance proceeds, those funds will end up being paid to either to the family or to the state.  With the PRC price protection promise to families, excess trust earnings are paid to the funeral home.  Depending on certain factors, the difference in payment to the funeral home can be hundreds, even thousands, of dollars. Understanding the following factors that lead to preneed shortfalls can lead your funeral home back to the path to preneed profits:  Preneed Investment Return Duration of the Preneed Contract Duration of Installment Payments Sales Expense/Commission Retained Funeral Home’s Operation Cost Increases The Price Protection link: Price Protection | Death Care Compliance Law PRC Price Protection Program Basics Two Guaranteed Options are offered: 10 Year and Life Time For a 10 Year Guarantee, a 5% surcharge fee is included in the prearrangement cost.  At the end of the 10 Year Guarantee, the Life Time Guarantee can be purchased for 5% of the then current funeral arrangement price. For a Life Time Guarantee, a one- time 10% surcharge fee is included. For installment contracts, a 6% installment fee is also included in the monthly payment. The consumer is given the following “cost guarantees”: Payments in excess of the actual at-need cost will be refunded. If the trust value at the time of performance exceeds the at-need cost, a portion of the Surcharge Fee will be refunded (up to the ‘excess value’). Monthly payments can be prepaid to reduce installment fees. All surcharge fees and installment fees are deposited to trust, and are fully refundable upon cancellation. For the consumer that cannot afford the lowest possible installment payment, a non-guaranteed final expense trust can be purchased.  The consumer’s funds will be invested in a diversified investment pool designed exclusively for death care funds.  When the trust has grown sufficient, the final expense trust can be converted to a guaranteed contract.  Or, the consumer may continue to maintain their funds in the final expense trust. The Program includes: Installment Payment Administration Specially Designed Contract Forms GPL Disclosures Annual Economic Reviews Reports and Forms for Refund Computations Contact us if you want to comparison of your program’s costs and benefits to the PRC Price Protection Program.  
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Preneed Resource Company 5350 W. 94th Terr, Suite 202 Prairie Village, KS 66207 Tel: 913-378-9922 Tel: 800-449-0030 Fax: 913-378-9924