California funeral price and prepaid funeral trust rights

When you begin discussing prices or the funeral goods and services offered, a California funeral director must give you a written or printed list that includes the price for professional services offered and a statement of the price range for all caskets offered for sale. The list must also say that the survivor handling the arrangements, or the responsible party, is entitled to receive, before any contract is drafted, a copy of any preneed agreement the funeral establishment holds that was signed and paid for, in full or in part, by or on behalf of the person who died. Ask for this list at the start of the conversation. [1]

Every funeral establishment must present that copy to the survivor handling the arrangements or the responsible party, in person, by certified mail or by fax, as agreed with them. An establishment that knowingly fails to present it is liable for a civil fine equal to three times the cost of the preneed agreement, or $1,000, whichever is greater. Ask whether the funeral establishment holds a preneed agreement for the person who died. [3]

The funeral director must place the price on each casket in a conspicuous manner, and each casket must be priced individually, whatever type of service is purchased. A funeral director may not charge the survivor or responsible party a handling fee for a casket they supply, and no funeral director or embalmer may charge an additional fee for handling or embalming a body when death was due to a contagious or infectious disease. Ask whether any charge on your statement relates to a casket you are providing. [2]

A licensed California funeral establishment may not enter into or solicit a preneed contract requiring payment to it unless the contract requires that all money paid, directly or indirectly, be held in trust for the purpose for which it was paid until the contract is fulfilled. Money received for deposit in trust must be placed with a trustee within 30 days of receipt, under a trust agreement signed by the funeral establishment, the person paying (the trustor) and the trustee. The trustee may be a bank or trust company authorized in California, or not fewer than three people, one of whom may be an employee of the funeral establishment. Ask who the trustee is. [4][6][5]

Trust income may pay a reasonable annual fee for administering the trust and build a reserve of up to 10% of the trust corpus, which is all the money paid in, as a revocation fee. None of the corpus may be used to pay commissions, other trust administration expenses or taxes on trust earnings. Before the funeral establishment has furnished the merchandise and services, the trustor or their legally appointed representative may demand in writing the return of the corpus and any income accrued in the trust, less a revocation fee not exceeding that reserve. Ask how much has been reserved as a revocation fee. [4][5][6]

A trustor who is eligible, or seeking to become eligible, for public social services may choose to make the trust irrevocable, and a trust agreement with certain public assistance recipients may provide that it is irrevocable if the value limits in the Welfare and Institutions Code are not exceeded. These preneed trust rules do not apply to cemetery property, cemetery commodities, cemetery service, or merchandise that is delivered as soon as it is paid for. Check whether your trust agreement includes an irrevocable choice before you sign, and ask a cemetery separately about the terms for anything you buy from it. [6][7]