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If you haven’t made provision for your funeral, your family will have to pick up the tab – and if they don’t have access to large amounts of ready cash, this will certainly add to their grief.
Personal Finance asked Marius du Plessis, group communications manager at Avbob, Minki Ngcobo, chief executive at the Doves Group, and Wjm Piek, managing director of Martin’s Funerals Franchising, what the average funeral costs.
Avbob, Doves and Martin’s – all big names in the funeral and burial business – have websites, but none of them publishes prices for the various services the companies provide.
The only prices you might find are for the funeral polices they sell. Avbob and Doves are authorised financial services providers (FSPs). Martin’s franchisees are representatives for Assupol Life, which is an FSP.
Du Plessis says the absence of specific prices is because the range of products and services is large, and they are tailored to suit the needs of the deceased’s relatives. However, he says “the most basic service” could be performed for R7 500, inclusive of VAT. This charge applies to both cremations and burials.
The average funeral performed by Avbob costs “plus-minus R12 000”, Du Plessis says.
Piek says burial prices can start at R6 000, although the price depends on the choice of coffin and the services required. Cremations can start at R8 000, but the actual cost also depends on the coffin you choose. He says there’s no limit to what you can pay for a coffin, citing the burial of Michael Jackson, whose gold-plated casket reportedly cost US$25 000 (R222 500 at current exchange rates).
Ngcobo says it’s impossible to say what “the average” funeral costs, because the company is “dedicated to personalising each service to the particular client’s requirements”.
The cheapest coffin that Doves sells is R700, and the priciest ones go for more than R50 000, Ngcobo says. Avbob’s cheapest coffin is R1 360, and its top-of-the-range casket sells for R24 500, Du Plessis says.
Piek says Martin’s doesn’t sell coffins to the public. The company provides a comprehensive service that includes the care, transportation and cremation or burial of the deceased, as well as the funeral service itself.
Ngcobo says if you opt for a burial, Doves charges a service fee of R4 700, which covers removing the deceased, handling all documentation (including the death certificate), storing the body, caring for and preparing the body, buying a coffin and using a hearse.
Ngcobo says the service fee for a cremation is R5 000, which covers all of the above services, plus collecting the ashes from the crematorium. But the price excludes the cost of a coffin and having the medical forms signed before the cremation.
Both Du Plessis and Ngcobo say they would advise consumers to invest in a funeral policy.
“The cost per month is really affordable, and the benefit once death occurs is not merely monetary but also peace of mind,” Ngcobo says.
Ngcobo says 36 percent of Doves’ clients are covered under a funeral policy and 22 percent are members of organisations that cover funeral costs in full or in part, such as a burial society or a friendly society. The remaining 42 percent pay for funerals out of their own pockets.
Du Plessis says it is important to buy cover from a reputable insurer and to make sure the policy provides for your needs.
Piek says you should use a reputable funeral director. “It also helps if the funeral director is a member of the National Funeral Directors Association, Independent Funeral Directors Association and South African Funeral Practitioners Association, as members would have to adhere to codes of conduct and prescribed regulations.”
There are many ways that you can provide for your funeral, including:
* An emergency fund, which involves saving money, usually in a bank account. If you want to put aside money to cover your funeral expenses, you will have to save the money in a family member’s bank account, because when you die, your bank accounts will be frozen, along with the rest of your assets.
* If you have a life policy or your employer provides you with group life cover, the policy may offer a funeral benefit, which usually pays out within 48 hours of your death. You will not necessarily be underwritten. This means your premiums will not be determined by the risk that you pose to the insurer.
* If you have a funeral policy, a cash benefit is paid to your beneficiaries on your death. You buy these policies from life assurers or funeral parlours, and limited or no underwriting applies. A six-month waiting period usually applies.
* A funeral plan, which can be bought from a funeral parlour, burial society or short-term insurer, covers you and sometimes members of your immediate or extended family, too. No or limited underwriting applies.
The funeral assurance market can be treacherous, and the Financial Services Board and National Treasury have realised the need for consumers to be better protected against funeral parlours that may not be licensed for this business.
National Treasury has proposed the introduction of the Microinsurance Act to regulate funeral assurance. Ingrid Goodspeed, chief director of financial inclusion and market conduct at Treasury, says Treasury plans to release draft legislation for comment this year and to table the legislation in 2014 for implementation in 2014/15.