Some groundwork can be established during the first phone call. My standard inquiry is normally sufficient to give me a clear picture. I ask whether grave space has been set aside for the deceased. If the answer is yes, that usually means a complete funeral with ground burial rather than cremation. A family already intent on cremation usually tells me so at that point. When we later meet the family at the residence, we ask them to bring the necessary paperwork to the arrangement conference, including life insurance policies. If the family has life insurance, that is normally a good sign.
Many insurance companies accept a funeral-home-provided assignment form, which allows the home to assign the proceeds to pay funeral expenses, assuming that the beneficiary of said policy is amenable to the idea. However, in many instances, I have discovered that policies have lapsed because of nonpayment of premiums or the death benefit has been greatly reduced because of loans taken out against it. Other policies have been in force for only a matter of months, and there is generally a two-year contestability clause, which means that the company won’t pay off on a policy less than two years old. I have seen some very sad faces before me when I have had to report that the policy the family was depending on is no good.
One Cincinnati-area funeral home was caught a few years ago accepting the total proceeds of insurance policies, even when that amount was substantially more than the stated funeral expenses. On the form the employees would enter “total proceeds” on the line where they would normally write the amount needed. The beneficiary was likely asked to sign a blank assignment form or simply did not read what he or she was signing.
We no longer assume that people have life insurance. Employers tend to eliminate it from benefit packages when cutbacks occur. Customers without life insurance are then forced to work out some sort of payment plan, which usually turns out to be a bad deal for us. Some families request making monthly payments of $100—which means that they can’t pay a $5,000 funeral bill for more than four years!
From experience, I can report that such payments are rarely even carried out to completion. An old funeral director friend of mine once said, “The tears dry up when the bill arrives.” That adage holds true today. If directors are not paid within thirty days, we will probably not see our money without a fight. We hear many different things: “We’re waiting for our income tax refund,” “As soon as we sell Dad’s house, we’ll pay your funeral bill,” “We need to sell Mom’s car first,” or “My aunt in Indiana is sending the money.”
A classic consumer ploy is when a family calls one funeral home to take care of their deceased father, and that bill is never paid. Later the mother dies, and the family calls another funeral home, with no intention of paying that bill either. Then, a few years later, Grandma passes on, and that same family calls upon a third funeral home…and so it goes.
We funeral directors have been forced to rethink our credit policies. In years past, if traditional collection procedures failed, we merely waited until someone else in the family died. Then we would attempt to collect on both funerals—or at least on the first one—or we would hope that any family still owing from a previous funeral would call a different home.
As late as the 1970s, few funeral homes asked bereaved families to sign expense contracts. They rightly assumed that the bill would be paid promptly. If not, there was no recourse except for a collection agency or attaching a lien on the responsible party’s residence, since we couldn’t exactly repossess the merchandise. That’s why without life insurance, funeral homes now ask for payment in full before they render any services.
Today there is little, if any, public assistance from cities or counties to pay for funeral costs. Most have an indigent program designed to provide a decent burial for someone with no immediate family. A grave space, burial vault, the opening and closing of the grave, and a grave marker are provided at no charge, and the cemetery bills the city. Funeral homes are instructed to place the body in a “reasonable” casket and deliver it to the cemetery for a brief graveside service. The city then pays the funeral home $500.
Many low-income families who have been in dire financial straits for years or even generations are quick to inquire about any available government assistance. Other poor families scrape together the money to bury their loved ones, without complaining that the city, county, or state should ease their burden. But there have been many occasions on which families have heard of the indigent program and assume that it is there for anyone who requests it.
I met with a young lady recently who sat down to discuss funeral arrangements for her recently deceased grandfather. As I compiled the necessary information, I discovered that all her grandfather’s children were deceased, he had no siblings, and the five surviving grandchildren were all he had left. The granddaughter further informed me that the man had no life insurance and was not a war veteran. She then inquired, “Before we go any further, can you call the city and make sure Grandpa is eligible for a city burial?”
I asked her how she knew about such a thing, since most people other than funeral directors do not even know the proper terminology. She explained that when her mother had died a few years earlier, the family had used the indigent burial program, and they had done so again when her sister died months later.
I called the city, and the man in charge asked me to repeat the family’s name, which I did. According to policy, he said, he would need to meet personally with the granddaughter to question her about her financial circumstances. The city was changing its attitude regarding city cases; too many families had been abusing the system. Large numbers of sons and daughters were expecting the city to bury their parents for free.
After her meeting, the granddaughter told me that she was shocked and embarrassed when she was asked how much she paid for rent and her monthly car payment. The city ultimately turned her down because she and her siblings all worked, most of them owned homes, and all of them were successfully meeting their car payments. It probably didn’t help her case that her family had taken advantage of the city’s generosity on two previous occasions.
Social Security pays a lump-sum death benefit of $255. In years past, anyone who paid into or drew Social Security received that amount. The payment was sent to the surviving spouse—or if there was no spouse, to the funeral home providing services. In 1974, the policy changed and the benefit is payable only if the deceased has a surviving spouse or minor children.
The Veterans Administration used to pay $450 for the funeral expenses of a deceased veteran who served during wartime. Today, the VA makes that payment only if the deceased was drawing a VA pension, was injured in action, or died in a VA medical facility. Many benefits are still available to veterans—free grave spaces in a national cemetery (many local cemeteries also offer free graves to veterans), government-provided grave markers, and U.S. flags. The VA obviously pays the funeral expenses of those killed in action. There are a surprising number of families who have been misinformed somehow that the VA pays the funeral expenses of any deceased veteran. I suppose that when informed that the VA provides a lump-sum death benefit in some cases, some folks assume that means the entire funeral bill is going to be paid.
The state of Ohio ceased its welfare burial award program several years ago. The state used to pay a funeral home $750 to provide a “decent” burial for those who were Medicaid-eligible or for those drawing Supplemental Security Income. At my former place of employment long ago, we conducted several welfare funerals each year, and we saw certain families a number of times.