Contracts and How to Read Them

I will admit that I may have, allegedly, signed a dotted line or two in my life without fully understanding what I was agreeing to. I bet some of you have also done this. However, when it comes to funeral contracts, it’s really important to me that you understand what you’re looking at. Not just for money reasons, but also for your peace of mind. 

I’m sure you’re confused as to why this topic needs its own post. What’s the big deal? We sign contracts every day, sometimes more than once a day, for all kinds of stuff – cell phones, credit cards, apps, rental agreements, etc. What makes funerals any different?

Well, unlike all the things I just listed, contracts for funeral services are designed by the government in an effort to protect you, gentle consumer. So, naturally, they make for great light reading. Note my heavy sarcasm.

I will now break down the basic layout of a funeral contract in a grossly oversimplified fashion. Hopefully, this will allow anyone reading to have an easier go of it come curtain call.

There are three parts to a funeral contract: 

1. Services – The services area of the contract is exactly that. It creates the structure of the contract and contains its only non-declinable charge, the basic service fee, which covers the overhead incurred during the time of the services provided. This area also includes charges pertaining to transferring the deceased, preparation of the remains, supervision and facilities charges, and vehicles used, such as hearses and/or livery to suit the family’s needs.

2. Merchandise – Another self-referential category. Merchandise covers any non requisite funeral goods like caskets, urns, stationary (programs or prayer cards), flowers, etc. that may be purchased to enhance a funeral service. Be aware that depending on your State, these items may be subject to sales tax. 

3. Cash Advances – Third-party items that are procured at-cost by the funeral home on the family’s behalf, like clergy, cemetery fees, death certificates, permits, musicians, hairdressers, newspaper obituaries, etc. This portion is kind of like an I.O.U. All of the services listed have to be paid upfront. So the funeral home is, in effect, reimbursed by the family at the time the contract is paid.

When you look at a contract you’ll notice two things right away: the pages are long and the font is small. 

Why long pages? 

This is because there are several mandated disclosures and fine print disclaimers that must appear on the contract. Some disclosures may change depending upon the services selected. For example, every contract with refrigeration in New York must disclose why you’re being charged for refrigeration. At our funeral home we require refrigeration after six hours of having the deceased in our care, when embalming is not being performed. Also, if the deceased is being transferred to another state or country, we must disclose why we are using specific shipping materials for that purpose.

Why small print?

Funeral contracts must list, in detail, the services it will provide to each family. They essentially look like an a la carte menu. The items you select will have the price listed next to them. The items you decline will have “N/A” or a zero in the price column. This is for your protection. The absence of blank space prevents unscrupulous folks from writing in prices for items you did not agree to purchase. 

Here is a an example of a preplan contract from Texas. While it’s not exactly the same as the contract you’d see at-need during the arrangement conference, the first two pages are an accurate representation of itemized costs and services.

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