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I paid Safe Hands for a funeral plan: Can I get my money back?


I’m 77 and paid Safe Hands £3,355 for a funeral plan six years ago – can I get my money back? Steve Webb replies

In 2016 I paid Safe Hands £3,355 for a cremation service. 

I have since read that they may not have the funds to honour my funeral. Should I try to get my £3,355 by the cancellation of my policy? I am a 77-year-old man and divorced.

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I paid Safe Hands £3,355 for a funeral plan six years ago – can I get my money back?

Steve Webb replies: Some people feel very strongly that even if they can’t leave much to their loved ones, they are determined to make sure that their funeral costs are covered.

As a result, as in your case, they take out what is called a ‘pre-paid funeral plan’ where you hand over money now and then some or all of your funeral costs will be covered when you die.

There have been concerns that the market for these products is not well regulated. Much money is spent promoting them which can mean that a chunk of your premium is simply paying a sales commission.

In addition, people may take out a policy years or even decades before they die, and there was no way of being confident that the company you were dealing with would still be trading by then or would have enough money at that point to pay out on all the policies.

In response to this, the Government undertook a review of the funeral plan market and from 29 July 2022 the Financial Conduct Authority will take over regulation of the sector.

Steve Webb: Find out how to ask the former Pensions Minister a question about your retirement savings in the box below

Steve Webb: Find out how to ask the former Pensions Minister a question about your retirement savings in the box below

From that date onwards only companies who are authorised by the FCA will be allowed to sell funeral plans. There will also be a ban on ‘cold-calling’ to sell funeral plans.

The FCA say that their reforms are designed to achieve four things:

– You get the plan you’ve paid for at a fair price, and it meets your needs

– Your money is looked after and used responsibly

– You get the information you need to make an informed decision

– Those selling plans meet [FCA] rules.

Go here for more details. 

Companies currently selling funeral plans have had to decide whether or not to apply for authorisation and the company you used – Safe Hands – have decided not to do so.

Since you sent in your question, the company has gone into administration, and there is more information on their website here, as well as some frequently asked questions. 

The website indicates that the administrators are exploring whether existing plans could be transferred to a new provider, but it is possible that you may lose some of the value of your policy.

For now, unfortunately, there is relatively little that you can do other than to wait and see what happens when Safe Hands is wound up.

But your experience shows why regulation of this sector was needed.

Anyone considering buying a funeral plan may wish to wait until the FCA takes over regulation of the sector at the end of July or at the very least to make sure that the firm they are using is one of those which has already been approved.

What should you do if contacted by someone claiming to be from Safe Hands? 

The administrators have warned Safe Hands plan holders to be alert to the possibility of fraud, writes This is Money.

They say if you are contacted by someone claiming to be from Safe Hands Plans, FRP Advisory, Dignity or any other company claiming to be involved in the administration, end the call.

Once you have done so, contact the administrators using the following details.

Website: www.safehandsplans.co.uk

Administrators’ email: [email protected]

Administrators’ helpline: 0800 640 9928

Ask Steve Webb a pension question

Former Pensions Minister Steve Webb is This Is Money’s Agony Uncle.

He is ready to answer your questions, whether you are still saving, in the process of stopping work, or juggling your finances in retirement.

Steve left the Department of Work and Pensions after the May 2015 election. He is now a partner at actuary and consulting firm Lane Clark & Peacock.

If you would like to ask Steve a question about pensions, please email him at [email protected].

Steve will do his best to reply to your message in a forthcoming column, but he won’t be able to answer everyone or correspond privately with readers. Nothing in his replies constitutes regulated financial advice. Published questions are sometimes edited for brevity or other reasons.

Please include a daytime contact number with your message – this will be kept confidential and not used for marketing purposes.

If Steve is unable to answer your question, you can also contact MoneyHelper, a Government-backed organisation which gives free assistance on pensions to the public. It can be found here and its number is 0800 011 3797.

Steve receives many questions about state pension forecasts and COPE – the Contracted Out Pension Equivalent. If you are writing to Steve on this topic, he responds to a typical reader question here. It includes links to Steve’s several earlier columns about state pension forecasts and contracting out, which might be helpful.  

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