The Financial Conduct Authority (FCA) has announced it will be introducing new high standards for the funeral plan market ahead of the industry coming under regulation from 29 July 2022.
The regulator confirmed it will require firms to ensure that plans are sold fairly, perform as expected and provide value for money.
This includes new standards on advertising, a ban on cold calling, a ban on commission payments to intermediaries to ensure fair value, and those selling funeral plans will be subject to full checks on their fitness to operate to improve governance standards and oversight.
Sheldon Mills, the executive director of consumers and competition at the FCA, said: “Funeral plans should provide customers with comfort and certainty that their affairs are in order.
“Our new rules for the sector will drive up standards and ensure that when consumers buy a plan, they receive a product that matches their needs and expectations.”
He added: “We are banning all commission payments to intermediaries to make sure products offer fair value, and, having seen the real harm cold calling can cause consumers, we’ll be banning it.
“As we take over the regulation for this market, we will be rigorously assessing the firm’s fitness to operate. Firms must now plan for this new regulatory regime or prepare to leave the market in an orderly manner.”