The benefits that families receive when pre-arranged funeral or cremation arrangements are made are significant. Families often comment on two main benefits of pre-arrangement which are emotional benefits and financial benefits.
When having to face making arrangements for a loved one, it is difficult to make the many decisions that must be made at a time when you are emotionally distraught. By having final wishes in order, this ensures that these decisions are not being left to those in grief. Additionally, this process can ensure that final wishes are followed through with and can give others the peace of mind in knowing that this is what their loved one would have wanted.
There are financial benefits to paying for funeral or cremation arrangements beforehand. By arranging a pre-arranged funeral or cremation, you “freeze the cost” of the funeral home’s services and merchandise at today’s cost. For example, if you purchased an arrangement at $5,000 today, and many years later this same arrangement cost $7,500, you would not have to pay the difference. Additionally, with a pre-arrangement, payments can be made at an amount that you can afford. This can be beneficial even to those with life insurance. For example, a life insurance policy that has a death benefit of $5,000 may be enough to cover certain arrangements today, however when the cost of a funeral or cremation arrangement increases, will $5,000 be enough to cover the expenses? By taking out a pre-arrangement, you guarantee the cost of the funeral, and the life insurance can be left to assist surviving loved ones.
Commonly Asked Questions and Concerns
Are my Funds Safe?
There are two funding options for pre-arrangements that are acceptable within the standards of the Colorado Department of Regulatory Agencies who oversee Pre-Need Arrangements in Colorado. Trust and Insurance Pre-Arrangements are the two allowable funding options. At the Kent Funeral Homes, we feel that Insurance Pre-Arrangements offer the best options for families. A licensed insurance agent affiliated with our funeral homes can assist in writing insured pre-need arrangements for families. In purchasing an insurance funded pre-arrangement, the purchaser maintains ownership of the policy and can determine and change the beneficiary. In addition to being overseen by DORA, insurance policies are maintained under insurance regulations as well.
How Does “Freezing The Cost” Work?
In order for Funeral Homes to be able to “Freeze the Cost” of pre-arrangements, they are allowed to accept the growth (or interest) that is earned on the policy up to the current (at the time of death) cost of the services that were pre-arranged. If the interest or principal amount exceeds the current cost of services (which seldom happens), the additional amount will be returned to the next of kin or designee. However, if the principal and growth (or interest) are less than the current cost of the service, the family is not required to pay the difference. (Note: This does not apply to “Cash Advance” items that are paid outside of the funeral home such as gratuities, sales tax, opening and closing of the grave, etc.). As you can see, the main benefit to the funeral home is in securing the opportunity to serve a family in the future.
What If I Move Away From The Area?
If you move away from the area, it may still be possible for the Kent Funeral Homes to honor
your pre-arrangement. For example, we still serve many families who have moved to the front range or western slope and wish to have a service or be buried in Leadville or the surrounding area. It is important to note that should you move outside of our service area (i.e. out of state or out of the area without the intention to have a service or be buried in the area) that another funeral home is not required to honor the pre-arrangement made with Kent Funeral Homes. However, the principal amount that you paid into your pre-arrangement in addition to any growth on the policy would still be owned by you and could be applied toward the costs at another funeral home should they not be able or willing to honor the pre-arrangement as written.
Please contact us for additional information or to set up an appointment to discuss Pre-Arrangements in detail.
Arrangements can be made in the comfort of your own home by clicking the button below. Fill in as much as you are comfortable with and we'd be pleased to meet with you to discuss further. See the form below for details.