Millions of Americans have entered into contracts to prearrange their funerals and prepay some or all of the expenses involved. But protections vary widely from state to state , and some state laws offer little or no effective protection. Some state laws require the funeral home or cemetery to place a percentage of the prepayment in a state-regulated trust or to purchase a life insurance policy with the death benefits assigned to the funeral home or cemetery.
States have different requirements for handling funds used for prearranged funeral services.
Some prepaid funeral plans can be transferred, but often at an added cost. If your family isn't aware that you've made plans, your wishes may not be carried out. And if family members don't know that you've prepaid the funeral costs, they could end up paying for the same arrangements. You may wish to consult an attorney on the best way to ensure that your wishes are followed.