MANY people buying prepaid funeral plans are not aware that their preferred undertaker may not carry out their wishes, it is claimed.

Steven Tapper, boss of one of Dorset’s leading funeral directors, spoke out after the funeral prepayment industry was investigated in in a documentary, Pay Now, Die Later, in ITV’s Tonight strand.

The programme found the prepaid funeral sector was growing fast without any regulation, with £4.3billion already set aside for prepaid funerals. It raised concerns that consumers often did not know what was not covered by the plans.

Steven Tapper, joint managing director of Tapper Funeral Service, said: “The TV programme highlighted how a plethora of new companies that have no connection with the funeral business, are aggressively selling prepaid funeral plans and often by questionable means. The reporter uncovered that a funeral plan is sold by these companies at a typical ‘at-need’ rate but that means that when the funeral is required, the actual funeral director is only paid a percentage of the original amount.“The difference as the reporters noted, is kept by the ‘prepayments’ company for their own service.”

But he said some prepayment companies were wrongly suggesting they were keeping costs down by “bulk-buying” funerals.

“In simple terms, what the prepayments companies are saying to consumers isn’t true,” he said.

“They do not approach any one funeral director and offer dozens of funerals at a contract rate; they cannot as there simply are not enough of the plans for any one area to achieve a ‘bulk-buy’. What they actually do is approach a funeral director and offer them, say, 70p in the £1 for the funeral package that is described.

“Most funeral directors of substance and quality – and most likely the very ones that the plan holder has assumed will be appointed – give a very simple ‘no’. My reason for this is why would a funeral director of repute provide a very large discount to a third party that they would not give to their own loyal private clients?”

He said the result would either be a reduced service from the preferred funeral director, or that the prepayments company would find another firm that was prepared to provide the funeral cheaper.

“This is likely to either be a funeral director from further afield or a funeral director of a lesser reputation and quality who will take on the work,” he said.

The Competition and Markets Authority (CMA) has launched a review of the funerals market, which is due to be published in November.

The Funeral Planning Authority (FPA), set up by the industry to regulate providers, has said: “The FPA agree that there are some problems in the market, but these are limited, and caused by a very small number of providers who are not FPA registered, constituting approximately five per cent of the markets for new plans.”

It says new regulations would be “disproportionate” and less effective than making FPA regulation compulsory for all providers.