I’m sure you’ve heard the story of people who lost the whole amount they gave to the funeral home that went out of business or was sold? In N.C. – here is why it’s safe for you to do.
The facts are as follows for North Carolina (other states are different):
All NC pre-need accounts are actually funeral trusts.
Just as with other trusts, funeral trusts have beneficiaries.
The funeral home is simply a beneficiary of the trust.
The future deceased person is also a beneficiary.
That person can also be the trustee.
Just as with other trusts, for funeral trusts the beneficiary can be changed.
This means, the funeral home can be changed.
If a funeral home goes out of business, a new beneficiary (funeral home) is named.
If the future deceased person moves out of town or out of state or just simply
wants to use another funeral home, the trustee can change the name of the funeral home.
There are times, such as for Medicaid planning, a Funeral Trust would have to be “Irrevocable”. We suggest that this type of planning be done in conjunction with an experienced Elder Law Attorney.
The funeral home NEVER has access to the trust funds prior to death.
The funds in the trust are always owned by the trustee, trustor OR the future deceased beneficiary BUT NEVER the funeral home.
Any funeral home in NC that is depositing pre-need funds in their own bank account is embezzling and, if used, misappropriation.
NC has a Board of Funeral Service governed by the state which conducts annual audits on all pre-need accounts for all funeral homes.
Thanks to: Joe R. Smolenski, III
V.P. and Manager, Renaissance Funeral Home, Raleigh, NC