2023
9
UK Funeral Planning Market Report 2023
2023-08-30T04:15:39+01:00
OX1155123
2600
166201
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Report
en_GB
“With total funeral costs tending to rise above general inflation, prepaid plans can be a shrewd purchase as they lock in today’s prices as well as letting loved ones know…

UK Funeral Planning Market Report 2023

 2,600 (Excl.Tax)

Description

Stay ahead of the curve and secure future growth for your business with Mintel’s UK Funeral Planning Market Report 2023. Our full report is packed with consumer-led market intelligence, the latest trends and consumer behaviours affecting your industry. Get a 360° view of the UK prepaid funeral plan market including forecasted growth and analysis of consumer attitudes and preferences.

Below, we’ve handpicked the key insights analysed in the full report and summarised the core topics.

Key Topics Analysed in this Report

  • The market size and forecast of the prepaid funeral plan market and the largest providers.
  • Current status of funeral plans and preferred type of funeral.
  • Financial provision and current take-up of prepaid plans.
  • Factors behind choice of prepaid funeral plans.
  • Information channels used to find out more about prepaid plans.
  • Interest in alternate/non-traditional funeral arrangements.
  • Attitudes towards funeral and financial plans.

UK Funeral Planning Market – Current overview

The number of funeral plans sold in 2022 fell by 18% on the previous year. This decline was attributed to the industry becoming FCA regulated midway through the year, which saw the collapse of some providers.

Over the next five years to 2028, the number of new sales is expected to increase from 178,000 to 237,000 with sales of basic funeral and direct cremation plans continuing to drive growth.

Over two-thirds of over-65s in the UK have not made formal plans for their funeral, which highlights how a large portion of the target market for prepaid funeral plans remains underserved.

UK Funeral Plan Market Trends and Opportunities

More consumers relying on savings

Mintel’s market research found that over half of consumers agree that the ongoing cost-of-living crisis has made simpler funerals more appealing. Furthermore, rising interest rates could increase the number of people relying on savings to cover funeral costs instead of taking out a plan. Prepaid plan providers need to make consumers aware that relying on savings is a risky strategy, and highlight the fact that prepaid funeral plans provide protection against future inflation.

Normalise funeral discussions to boost engagement

Almost half of over-65s have not discussed their funeral with their family.  This lack of dialogue can ultimately cause greater emotional and financial burden. Prepaid plan providers can and should play an important role in helping to destigmatise the topic of death, easing the conversation into wider later-life discussions.

Our full market report features a comprehensive analysis of trends and recommendations for growth opportunities in the industry. Purchase our UK Funeral Planning Market Report to help your business grow during times of uncertainty.

More About this Report

This report examines the UK market for funeral planning, with a particular focus on prepaid funeral plans. To a large extent, the latter compete with over-50s guaranteed acceptance plans, which are covered in our UK Over-50s Guaranteed Acceptance Life Insurance Market Report. The report features market share and key market activity of the market leaders: Co-op Funeralcare, Dignity Group, Golden Charter, and Pure Cremation.

Expert Analysis from an Industry Specialist

This report, written by Lewis Cone, a leading Financial Services analyst, delivers in-depth commentary and analysis to highlight current trends in the UK Funeral Planning market and add expert context to the numbers.

With total funeral costs tending to rise above general inflation, prepaid plans can be a shrewd purchase as they lock in today’s prices as well as letting loved ones know of a person’s final wishes. This provides peace of mind for both the consumer and their loved ones, whilst protecting them financially and from having to make difficult funeral decisions at what is an extremely emotional time.

Lewis Cone - Research AnalystLewis Cone
Associate Director – Financial Services

Table of Contents

  1. Overview

      • Key issues covered in this Report
        • Products covered in this Report
        • Executive Summary

            • The five-year outlook for the prepaid funeral plan market
              • Figure 1: Prepaid funeral plan market outlook, 2023-28
            • The market
              • Market size and forecast
                • Figure 2: Forecast of prepaid funeral plan sales, 2018-28
              • Almost a quarter of funerals in 2022 were prepaid
                • Figure 3: Pre-arranged funerals as a share of all funerals in the UK, 2018-22
              • Direct cremations account for growing number of funerals
                • FCA regulation adds to blurring of funeral product and customer confusion
                  • Companies and brands
                    • Pure Cremation remains the largest prepaid funeral plan provider
                      • Figure 4: Estimated market shares of the top four funeral plan providers, based on volume sales, 2022
                    • The consumer
                      • A third of over-65s have made formal plans for their funeral
                        • Figure 5: Funeral planning status, by age, 2023
                      • Half of those with formal funeral plans have a prepaid plan
                        • Figure 6: Financial provision made for own funeral, 2023
                      • Cost is the most important factor behind choice of prepaid plan
                        • Figure 7: Prepaid funeral plan choice factors, 2023
                      • Funeral plan providers are the top source for product information
                        • Figure 8: Prepaid funeral plan information channels, by age, 2023
                      • Non-religious and celebration of life ceremonies appeal to a third
                        • Figure 9: Alternate funeral arrangements, 2023
                      • Under-55s more willing to pay a premium for ‘green’ funeral
                        • Figure 10: Attitudes towards funerals, 2023
                      • Confidence in product understanding is high but with room for improvement
                        • Figure 11: Attitudes towards financial plans for funerals, 2023
                    • Issues and Insights

                      • Push for price comparison and flexibility required as funeral costs continue to rise
                        • Providers need to help normalise funeral discussions to boost engagement
                          • Consumer duty provides opportunity to improve product understanding and value
                          • Market Size and Performance

                            • Sales of prepaid plans fall by close to a fifth…
                              • Figure 12: Volume of new sales of prepaid funeral plans, 2013-22
                            • Plans in-force slightly increase to 1.64 million
                              • Figure 13: Five-year summary of new sales, plans drawn down and plans outstanding at year-end, 2018-22
                            • Pre-arranged funerals account for a quarter of the overall funeral market
                              • Figure 14: Pre-arranged funerals as a share of total deaths in the UK, 2018-22
                          • Market Forecast

                            • Five-year outlook for prepaid funeral plans
                              • Figure 15: Prepaid funeral plan market outlook, 2023-28
                            • Direct cremation and alternate funeral services to drive plan sales growth
                              • Figure 16: Forecast of prepaid funeral plan sales, 2018-28
                            • Forecast methodology
                            • Market Drivers

                              • High excess mortality rate will result in greater number of plan usage
                                • Figure 17: Age specific mortality rate per 1,000 population, by gender – England and Wales, 2020-21
                              • Direct cremations account for growing number of funerals…
                                • Figure 18: Number of deaths and cremations – UK, 2017-22
                              • …with funeral directors adapting services to meet new trends
                                • The cost of a funeral declines for a second year…
                                  • …leading to more competitive funeral plan prices
                                    • Stubborn inflation adding to affordability concerns…
                                      • Figure 19: CPI and CPIH rates, 2022-23
                                    • …with most people feeling the effects of price rises
                                      • Figure 20: Consumers’ financial situation over the next year, 2023
                                  • Competition from Over-50s Guaranteed Acceptance Plans

                                    • Over-50s life insurance provides stiff competition…
                                      • …although annual sales have also experienced a decline
                                        • Figure 21: Volume sales of new guaranteed acceptance whole-of-life insurance vs funeral plans, 2018-22
                                    • Regulatory and Legislative Changes

                                      • FCA regulation adds to blurring of products and customer confusion
                                        • Outcome of CMA’s investigation into the funeral market
                                          • Consumer Duty adds further regulatory burden but should improve customer outcomes
                                          • Market Share

                                            • Pure Cremation remains the largest prepaid funeral plan provider
                                              • Figure 22: Estimated market shares of the top four funeral plan providers, based on volume sales, 2021-22
                                            • Other significant providers
                                              • The collapse of providers following FCA regulation has affected many plan holders
                                              • Competitive Strategies and Launch Activity

                                                • Co-op Funeralcare
                                                  • Figure 23: Key financial indicators – Co-op Funeralcare, 2019-22
                                                • Recent activity
                                                  • Looking ahead
                                                    • Dignity Group
                                                        • Figure 24: Key financial indicators – Dignity, 2019-22
                                                      • Recent activity
                                                        • Looking ahead
                                                          • Golden Charter
                                                            • Figure 25: Key financial indicators – Golden Charter, 2019-22
                                                          • Pure Cremation
                                                            • Figure 26: Key financial indicators – Pure Cremation, 2019-22
                                                          • Recent activity
                                                          • Advertising and Marketing Activity

                                                            • Adspend on funeral plans grows again in 2022…
                                                              • Figure 27: Total above-the line, online display and direct mail advertising expenditure on funeral director services, prepaid funeral plans and over-50s life insurance, 2019-22
                                                            • …driven by second consecutive bump in advertising by Pure Cremation
                                                              • Figure 28: Top 10 above-the line, online display and direct mail advertisers of prepaid funeral plans, 2019-22
                                                            • TV advertising is still most dominant ad channel…
                                                              • …although other channels still play an important role
                                                                • Figure 29: Above-the line, online display and direct mail advertising expenditure on prepaid funeral plans, by media type, 2019-22
                                                              • Co-op Funeralcare release celebrity podcast series about grief
                                                                • Nielsen Ad Intel coverage
                                                                • Funeral Planning Status and Preferences

                                                                  • A third of over-65s have made formal plans for their funeral…
                                                                    • Figure 30: Funeral planning status, by age, 2023
                                                                  • …whilst half are not expecting to make plans in the next decade
                                                                    • Targeting those in full-time employment key to increasing plan-making
                                                                      • Cremation preferred by 45% of people…
                                                                        • …although a fifth of under-55s prefer a burial
                                                                          • Figure 31: Preferred type of funeral, by age, 2023
                                                                      • Funeral Planning Provisions

                                                                        • Half of consumers with formal funeral plans have paid for it in advance
                                                                          • Figure 32: Financial provision made for own funeral, 2023
                                                                        • Over-55s more than twice as likely to hold a prepaid plan
                                                                          • More than a fifth expect their funeral costs to be covered by life insurance
                                                                            • Target under-55s with savings and ringfenced estate money to expand the market
                                                                                • Figure 33: Financial provision made for own funeral, by age, 2023
                                                                            • Factors Behind Choice of Prepaid Funeral Plan

                                                                              • Cost is the most important factor behind choice of prepaid plan…
                                                                                • Figure 34: Factors behind choice of prepaid funeral plan, by age, 2023
                                                                              • …with under-55s demanding flexible payments
                                                                                • Only a third considered FCA regulation compliance
                                                                                • Prepaid Plan Information Channels

                                                                                  • Funeral plan providers are the top source for product information…
                                                                                    • Figure 35: Prepaid funeral plan information channels, 2023
                                                                                  • …although under-55s place a higher value on the opinion of family/friends
                                                                                    • Figure 36: Use of family/friends and funeral plan provider for prepaid plan information, by age, 2023
                                                                                  • Providers need to promote the use of price comparison sites to help ease the burden of rising costs
                                                                                      • Figure 37: Use of price comparison websites for prepaid plan information, by age, 2023
                                                                                  • Alternative Funeral Arrangements

                                                                                    • Non-religious and celebration of life ceremonies appeal to a third…
                                                                                      • Demand for virtual funerals dwindles after pandemic boom
                                                                                        • Figure 38: Interest in alternative funeral arrangements, 2023
                                                                                    • Attitudes towards Funerals

                                                                                      • Cost of living likely to fuel demand for basic funerals
                                                                                        • Figure 39: Attitudes towards funerals, 2023
                                                                                      • Split opinion on live streaming’s appropriateness
                                                                                        • Majority would like to plan their own funeral instead of loved ones…
                                                                                          • Under-55s more willing to pay a premium for ‘green’ funeral
                                                                                              • Figure 40: Interest in paying more for an environmentally-friendly funeral, by age, 2023
                                                                                            • Taboo around discussing death must be tackled
                                                                                              • Figure 41: Funeral plan discussion with family, by age, 2023
                                                                                          • Attitudes towards Financial Plans

                                                                                            • Confidence in product understanding is high but with room for improvement
                                                                                              • Personal touch still vital when purchasing funeral plans
                                                                                                • Figure 42: Attitudes towards financial plans for funerals, 2023
                                                                                              • COVID has driven more to make plans in advance via online channels
                                                                                                • Figure 43: Funeral planning attitudes – CHAID – Tree output, 2023
                                                                                            • Appendix – Data Sources and Abbreviations

                                                                                              • Abbreviations
                                                                                                • Sources
                                                                                                  • Consumer research methodology
                                                                                                    • CHAID analysis
                                                                                                      • Methodology
                                                                                                        • Figure 44: Funeral planning attitudes – CHAID – Tree output, 2023
                                                                                                        • Figure 45: funeral planning behaviours – CHAID – Table output, 2023
                                                                                                    • Appendix – Forecast Methodology

                                                                                                      • Market forecast
                                                                                                        • Figure 46: Volume of new sales of prepaid funeral plans – prediction intervals, 2018-28
                                                                                                      • Market drivers and assumptions
                                                                                                        • Forecast methodology

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