Regulation of pre-paid funeral plan providers – January deadline looms

FCA regulation: Act now or it may be your funeral

On 12 November 2021, the FCA wrote to all CEOs of funeral plan provider detailing the next steps for imminent regulation of the sector.

To summarise, the FCA has announced that it will begin to regulate the pre-paid funeral plans markets from 29 July 2022. By this deadline, providers and intermediaries must have appropriate authorisation to continue funeral plan activities. Any providers and intermediaries that are not authorised by this date will have to cease operations.

By way of background:

  • Providers are recognised as firms that enter and administer funeral plan contracts. Providers must apply for direct authorisation.
  • Intermediaries are firms that sell funeral plans to customers on behalf of providers. Intermediaries must apply for either direct authorisation or to be Appointed Representatives.

The FCA’s letter encourages early engagement, complete with a high-quality application to ensure authorisation is as fast as possible. Providers and intermediaries have had since 1 September 2021, to submit applications. The FCA has warned that the authorisation process may take up to 6 months and therefore any applications submitted after January 2022 may not be determined by the deadline. If the application forms are not fully completed or a firm applies for a permission that is not required, the process can take up to 12 months.

From 1 November, existing providers will pay an increased application fee of £14,000 (£3,500 for intermediaries). Firms entering the market for the first time after 1 September 2021 will continue to pay the standard fee of £10,000 (£2,500 for intermediaries).

The application process consists of multiple forms, all of which can be found on the FCA website. Applicants can find out more details about the FCA’s standards required for approval at

Firms that do not obtain authorisation (whether due to withdrawal, refusal, or absence of application) will need a clear plan to wind down their business before the deadline. This plan must be clearly explained to customers and, if necessary, the process of transferring client plans over to an authorised firm must begin. Any firm which does not intend to apply for authorisation must inform the FCA at [email protected] (and present its wind-down plan).

The FCA maintains a central record of all plan providers and the status of their applications.

The message is clear – act now, irrespective of whether your firm is intending to apply for authorisation or not. At this stage, prompt action is required to meet the FCA deadline, failure to obtain authorisation will result in a suspension of all affected business. SMCR compliance is a central element in the authorisation process. To those encountering it for the first time, the Regulation is complex and full compliance can be time-consuming. Choosing the right partner for your journey to SMCR compliance is the solution.

Corterum is here to help you every step of the way.