Funeral Insurance: Beware of Deceptive Practices in Contracts

One-third of the 69 professionals offering funeral insurance who were audited were found to have irregularities, which resulted in 27 warnings and 5 orders to comply, according to the Fraud Prevention Agency (DGCCRF).
 

The French Anti-Fraud Agency (DGCCRF) is urging consumers to be vigilant in the face of "persistent deceptive business practices" in the funeral insurance and funeral services sectors.

In a 2022 investigation into fair business practices in the funeral planning sector (banks, insurance companies, mutual insurance companies, brokers, and funeral homes), the DGCCRF reported that one-third of the 69 businesses inspected had violations, which resulted in 27 warnings and 5 compliance orders. 

The violations range from unilateral changes to the terms of the insurance contract to policies that do not cover certain expenses—such as the cost of digging a grave—leaving the family to bear the remaining costs, according to the Directorate General for Competition, Consumer Affairs, and Fraud Control. It is also common for people not to be informed that their premiums far exceed the amount paid out upon their death.
 

"These are whole life insurance policies; these funeral planning contracts are designed to cover funeral expenses. They are not savings products, and any excess premiums are neither refunded nor capitalized," notes François Sobry, spokesperson for the DGCCRF. "It’s a sector that’s important for us to monitor because these consumer transactions take place in an emotional context, which can affect consumers’ vigilance—especially since they are generally unfamiliar with this type of commercial service," he adds.
 

Numerous Shortcomings in Consumer Information
In mid-October, the Financial Sector Advisory Committee (CCSF) adopted an opinion on funeral insurance policies, after also noting a "lack of overall clarity in the pre-contractual information provided to policyholders, particularly due to the inappropriateness of the regulations applied to funeral insurance policies." Sellers of funeral insurance policies have committed to improving the information they provide.
 

In 2020, the DGCCRF also investigated the business practices of funeral homes, uncovering numerous shortcomings in consumer information, which could lead to additional costs for the families of the deceased. Some providers create confusion between services required by law (provision of a casket, cremation, and/or burial) and optional services (preparation of the deceased, provision of burial vaults, or stone masonry work). “Significant discrepancies between the advertised price of caskets and the price billed to families” were also noted.
 

In light of the violations identified, the DGCCRF has launched a new nationwide investigation targeting the funeral services sector, which began in 2024 and will continue through 2025.