Pennsylvania funeral, cemetery and prepaid-plan rights

Pennsylvania’s Funeral Director Law says no one may practice as a funeral director in the state without a valid license. Only a licensed funeral director or a resident intern (the statute spells it “interne”) may prepare or embalm a body. Ask for the name and license details of the funeral director responsible for your arrangements and check them with the State Board of Funeral Directors. [1][2]

Every Pennsylvania cemetery company must set aside each year, in a permanent lot care fund, at least 15% of the gross from lot sales or $1 per square foot of each lot sold, whichever is greater. For a mausoleum crypt the figure is 15% of the crypt’s construction cost or $50, and for a columbarium niche 15% of construction cost or $25, in each case whichever is greater. The fund is to be used for perpetual care, maintenance and preservation of the lots and grounds and for repair of cemetery buildings. Ask how the cemetery’s lot care fund is held. [14][15]

A newly organized cemetery company must deposit at least $25,000 with a qualified trustee before establishing a cemetery or selling a lot, unless it is a bona fide church or religious congregation, an association created by one, or a municipality. Most cemetery companies also need a registration certificate from the State Real Estate Commission; cemeteries owned or controlled by a church or religious congregation, a fraternal organization, an association created by one of them, or a municipality are exempt from that registration. The Commission may investigate a cemetery company and can fine it or suspend or revoke its registration. These exemptions do not by themselves tell you how a particular cemetery pays for long-term care, so ask for its care arrangements in writing. [16][17][18]

Only a licensed funeral director may offer or enter into a contract with a living person for funeral services to be provided when needed. Money a funeral director accepts for such a contract must forthwith be deposited in escrow, or transferred in trust, with a banking institution in Pennsylvania, and may be withdrawn only for the purposes it was accepted for. The State Board of Funeral Directors’ rule requires the entire amount received, including additional service or arrangement fees, to be deposited, and interest or earnings stay in the account with the principal. Ask which bank holds your money and whether it is held in escrow or in trust. [3][4][6]

The funeral director must report each prepaid contract to the Board. The rule says the report is not a public record, but it is available to the parties to the contract, heirs of the deceased, executors or administrators of the estate, courts and the Board. If you are a party, heir or estate representative, ask the Board how to request it. [5]

A separate 1963 law, the Cemetery and Funeral Merchandise Trust Fund Law, covers contracts for personal property or personal services for a future burial. The seller must deposit 70% of the retail sale price in a merchandise trust fund held by a Pennsylvania bank authorized to act as trustee, within 30 days after the end of the month in which final payment is received; before final payment, payments go monthly into a special account after the seller deducts the percentage it may keep. This law does not apply to sales of cemetery lots or graves, and it does not affect the Funeral Director Law’s prepaid funeral rule. Ask the seller which law applies to each item on your contract. [7][11][13]

Under that 1963 law, if a buyer defaults before final payment, the seller may keep 30% of the contract price from the special account as liquidated damages and must refund any balance. The 30% is measured against the contract price, not against the amount you have paid. Before signing an installment contract, ask what would happen if you stopped paying. [8]

The same law lets a buyer who has paid in full and moves out of Pennsylvania cancel by written notice to the seller and the trustee, before the goods or services are provided and before the death; the buyer receives the principal on deposit and the interest goes to the seller. If the seller cannot or does not perform promptly after the death and after a request, the family or next of kin may receive the amount on deposit from the trustee, and the seller remains liable for nonperformance. A contract term waiving the law’s provisions is void. Ask the seller in writing what the contract says about cancelling in any other situation. [10][9][12]