Consumer Protections

New Jersey has an extensive set of laws and regulations which govern the prepaid funeral market and provide consumers with the following protections:

  • Classifies the misappropriation of prepaid funeral funds as a criminal offense.
  • Restricts preneed sales, solicitation and promotion to licensed funeral directors.
  • Prohibits telephone or visitation “cold” calling.
  • Sets minimum disclosure standards.
  • Requires the existence of a prearrangement prior to providing a financial instrument for prepaying the funeral.
  • Provides that all funeral arrangements connected to a prepaid funeral agreement can be modified by specific individuals.
  • Provides that moneys used to fund revocable prepaid funeral agreements are 100 percent refundable upon demand by the purchaser, including all principal and interest (this does not apply to irrevocable agreements).
  • Requires that, with revocable prepaid funeral agreements, funeral directors return any proceeds in excess of the current retail prices to the purchaser or legal representative of the estate, or beneficiary (in the case of insurance products).
  • Provides for an irrevocable prepaid funeral agreement to be counted as an excludable resource for the purposes of SSI/Medicaid and General Assistance eligibility.
  • Prohibits funeral directors or firms from knowingly permitting themselves to be made the beneficiary of an insurance policy in conjunction with a prepaid funeral agreementt.
  • Prohibits the advertising and promotion of “discounts” that are not actual price reductions and which are based solely on an insurance policy’s premium rate table.
  • Prohibits the funding of prepaid funeral arrangements through retail installment contracts or credit life insurance and/or reverse mortgages.
  • Requires that all funeral insurance products used meet uniform standards established by the New Jersey Department of Insurance and are sold by a duly licensed funeral director and insurance producer.