Sun Life Direct

Sun Life Direct

July 03, 2012 06:20 ET

Is the Government's Funeral Payment Scheme Fit for Purpose?

As Funeral Poverty hits a record GBP118 million(1), a new report sheds light on the emotional and financial distress families suffer when looking to the welfare state for support with funeral payment

LONDON, UNITED KINGDOM--(Marketwire - July 3, 2012) -

- Almost half of 69,000 applications for a Funeral Payment (FP) rejected(2)
- So-called "pauper's funerals" (Public Health Funerals) expected to rise as it becomes "too expensive for poor people to die"
- Funeral Payment applicants forced into debt by committing to funeral cost of £1,000s prior to finding out if they will receive state support

A new Cost of Dying Special Report into Social Fund Funeral Payments from Sun Life Direct and the University of Bath reveals that the Funeral Payment scheme, intended to contribute to the cost of funerals for the most vulnerable in society, is failing to meet mounting demand. As the cost of funerals increases and economic austerity continues, the report warns that a burgeoning older population is likely to bring ever-increasing pressure on an already stretched system.

69,000 applications were made for a Funeral Payment last year; moreover, almost half were rejected, leaving large numbers of vulnerable people having to consider alternatives such as a Public Health Funeral or, so-called, "pauper's funerals". Even for those successful in their application, the typical sum awarded of £1,217 falls far short of today's average cost of £3,091 for a funeral(3), leaving many with significant outstanding debt to pay.

The study paints a picture of an outdated support system at odds with the reality of modern day funerals. For example, the research indicates that the process through which family members are currently assessed is unclear and relies too heavily on traditional notions of the 'nuclear family', not taking into account the quality of relationships and the inclination to pay towards the deceased's funeral. As such, survey respondents were often left feeling confused, frustrated and a sense of social shame when applying for assistance. Furthermore, the process was also felt to exacerbate claimants' ill health, over half of whom were seeking help for depression, anxiety and insomnia.

Within an international context, the study suggests that the UK is in a weak position to address the provision of state support for those who cannot afford a funeral. An emphasis on individualism that regards death as a private event, a reliance on a free market economy to regulate funeral costs and a political narrative of welfare dependency rather than entitlement make for a perfect storm of disadvantage to confront the underlying issues.

Dr Kate Woodthorpe, a lecturer in Sociology at the University of Bath and author of the report, comments: "Quite simply, it is becoming too expensive for poor people to die. Thousands of the most vulnerable in society are being let down by a system of state support that lacks coherence and is so unclear that some applicants have to resort to alternative means to organise a funeral. One participant in the study decided to undertake a DIY funeral, buying her mother's coffin from the internet and picking up the body from the hospital in her car. She subsequently sold the car to generate cash to pay for the funeral costs."

The UK's ageing demographic is also set to worsen the problem of state support for funerals. Last year alone, the number of applications rejected for a Funeral Payment increased by 6.9 per cent, and this is likely to jump again as the death rate is forecast to rise by 17 per cent each year for the next 15 years(4). With rising concerns about pensioner poverty and the cost of social care, having sufficient resources on hand to pay for a funeral is set to become an issue for a growing number of people.

Simon Cox, head of life planning at Sun Life Direct, says: "We have to ask ourselves whether the current infrastructure for end of life support is fit for purpose. Something must be done, and quickly. A good starting point would be to address the issue of timing. More often than not the claimant will need to commit to funeral payment prior to confirmation whether they will receive support. Bereaved people must know what they will receive before they agree to taking on debts, otherwise we will see the most vulnerable caught in a spiral of debt and distress."

Notes to editors

About the research

The Cost of Dying Special Report: Social Fund Funeral Payments was commissioned by Sun Life Direct and carried out by the Centre for Death and Society at the University of Bath. It outlines the key findings from a qualitative study into the process and experience of applying for a Social Fund Funeral Payment (FP). The research involved interviewing claimants, funeral directors and stakeholders in order to examine and evaluate the way in which state support was being organised and administered. To contextualise the research internationally, and to enable the development of a cohesive set of recommendations, the study was complemented by a comparative analysis of state support and provision for funerals in 18 countries, (Australia, Canada, Ireland, New Zealand, South Africa, the United States, Belgium, France, Germany, Greece, Italy, Spain, Switzerland, Denmark, the Netherlands, Norway, Sweden and Japan).

* Sun Life Direct Cost of Dying Report - Series of annual reports commissioned by Sun Life Direct and carried out by Mintel Research Consultancy since 2004. The research uses a consistent approach to ensure data comparability over time in exploring the financial and emotional costs associated with dying. The study draws on responses from funeral directors and a panel of UK adults.

About Sun Life Direct

Sun Life Direct is a provider of Over 50s Life Insurance, Funeral Plans and Term Life Insurance. In fact, the Guaranteed Over 50 Plan is the nation's most popular choice for over 50 life insurance (ii).

The Sun Life name has been around for 200 years and has roots stretching back to 1810. By 1900 Sun Life were the first to offer life insurance without the need for a medical - something we're still proud to offer today. More information on Sun Life Direct can be found at

(ii) Most popular whole of life guaranteed acceptance plan bought directly. ABI statistics, Q1- Q4 2011

About AXA

AXA UK is a part of the AXA Group. The AXA Group is a worldwide leader in insurance and asset management serving 101 million clients. It is ranked the largest insurer in the world by net written premium and the top insurance brand globally.

In the UK AXA operates through a number of business units including: AXA Wealth; AXA Commercial Lines, AXA Personal Lines, AXA PPP healthcare, AXA Ireland and an independent distribution business Bluefin. AXA employs over 13,000 staff in the UK.

For full year 2011, IFRS revenues amounted to Euro 86.1 billion and IFRS underlying earnings to Euro 3.9 billion. AXA had Euro 1,079 billion in assets under management as of December 31, 2011.

The AXA ordinary share is listed on compartment A of Euronext Paris under the ticker symbol CS (ISIN FR0000120628 - Bloomberg: CS FP - Reuters: AXAF.PA). AXA's American Depositary Share is also quoted on the OTC QX platform under the ticker symbol AXAHY.

The AXA Group is included in the main international SRI indexes, such as Dow Jones Sustainability Index (DJSI) and FTSE4GOOD.

(1) Sun Life Direct Cost of Dying Report* 2012
(2) Annual Report by the Secretary of State for Work and Pensions on the Social Fund 2010/2011

(3) Sun Life Direct Cost of Dying Report* 2011
(4) National Audit Office (2008) The potential cost savings of greater use of home- and hospice- based end of life care in England, prepared by RAND (Cambridge: RAND).

Contact Information

  • To view the complete report, please contact:
    MHP Communications
    Elliot Bishton
    +44 (0)20 3128 6132