The UK competition watchdog is launching an in-depth market investigation into the funeral sector.
The Competition and Markets Authority (CMA) says it is concerned about the effectiveness of competition in the funeral market and is carrying out an in-depth market investigation.
The investigation will focus on the funeral directors and cremation services and is expected to be completed in the next 18 months.
The average cost of a funeral is now £4,271, with many people typically paying between £3,000 to £5,000, two-thirds higher than a decade ago.
Some of the largest firms have increased prices between 6% and 8% each year for the past eight years and some local authorities have hiked fees even higher, the watchdog says.
The CMA says that the reluctance of firms to disclose clear prices, including online, or to provide comprehensive information on quality and range, makes it difficult for people to compare funeral directors.
It found low numbers of crematoria in local areas and that high fixed costs and the planning regime were making it difficult for new companies to enter the market.
The watchdog says that as many people are vulnerable when organising a funeral, they are not in a position to look at a range of choices. This appears to have made it easier for some funeral directors to charge high prices.
Pippa Wicks, deputy chief executive for the Co-op, says: “We welcome the CMA’s decision to launch a market investigation and we hope it will lead to improved protection for families through access to consistently high standards of funeral care and a range of services that offer value at an affordable price.
“We’re pleased to see that the CMA investigation will also look at ways in which competition and prices in relation to crematoria services can be improved for the benefit of customers.
“We’ll continue to work with the CMA as they progress with the market investigation.”
Prices between funeral directors can vary significantly and you could save over £1,000 by comparing funeral directors in your local area.
While you will want to do the right thing when a loved one dies, it is not disrespectful to give some thought about funeral costs.
In conjunction with Age UK and the Money Advice Service, the CMA has also produced advice for those who need to arrange a funeral.
Arranging a funeral
You don’t have to use a funeral director. If you want to make the arrangements yourself, you can contact the cemeteries and crematorium department of your local council.
If you do use a funeral director, there are generally three elements to the costs:
- the funeral director’s professional services fee
- third party costs – often called disbursements - that the funeral director pays on your behalf such as for the cremation or burial
- optional costs – such as for catering or flowers.
Get at least two quotes if you can. Funeral directors’ charges vary, so it is important you understand any terminology used, what is included and what would incur an extra charge.
You should get itemised quotes by telephone, visiting their premises or checking to see if their prices are online.
You can ask for a detailed price list to help you compare costs – funeral directors who belong to the National Association of Funeral Directors (NAFD) or National Society of Allied and Independent Funeral Directors (SAIF) are required to make these available.
Comparison websites or online funeral directories may help your search – but bear in mind they may not cover all funeral directors in an area.
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Burials are often more expensive than cremations. Most funeral directors offer lower cost funeral options including ‘simple funeral’ packages or can arrange a direct cremation or funeral-without-service (where the body is cremated or buried without mourners present).
Don’t feel the need to hurry unless you have to for religious or other reasons. If you can, take the time you need and avoid making decisions on the spot.