The warning follows recent research which found that 42% of funeral plans and life insurance policies do not provide sufficient cover for an individual’s needs.
It also found that just over a third (42%) of those who had a policy in place to cover funeral costs were only covered for a total value of £3,000.
Meanwhile, a quarter (24%) of respondents said they were only covered up to £2,000 despite funeral costs for a cremation and simple service for example, costing around £3,290 on average according to supplier.
A fifth (20%) of adults surveyed with less than £4,000 in funeral cover wanted a burial ceremony, which would typically cost around £4,383.
Those with less than £4,000 of funeral cover expect other cost items such as catering (19%) and limos (11%) to also be included in the cover.
However, among adults over 50, two-thirds (68%) still do not have life or insurance cover.
For those without a funeral plan or life insurance in place, 33% said they would ask family members to take the value of their estate or set aside a pot of savings ( 29%) to meet the cost of their funeral.
Paul Bridgwater, head of insurance at OneFamily, commented: “The entry into force of the new regulations will likely mean that some funeral finance providers will not be able to operate or will choose not to apply for authorisation.
“As a result, we expect to see more advisors turn to life cover to meet this consumer need and guaranteed acceptance plans for the over 50s can be a simple and neat solution,” he said. he continued.
“That’s why it’s essential that advisors ask the right questions and ensure that the policy and payment levels they advise are really going to meet the client’s needs.”
Mike Allison, Chief Protection Officer at Paradigm, added that intermediaries now have a “clear path” to offer customers a “viable alternative to partially or fully cover their funeral costs using trusted and regulated organizations such as OneFamily. with regulated products”.
“Whole Life Plans have always been there to form the basis of clients’ future planning to cover a variety of events.”