An Article in Illinois has created some hysteria on the Illinois Funeral Directors Preneed Ponzi Scheme. The money left in the lady’s “Preneed account “is far less than what she will need for her funeral. Clearly the policy holder thought her funeral needs were covered.
The truly said part of this story is that the lady had a “non guaranteed preneed policy” which means that there is no guarantee that the money would be there to cover the funeral. What is truly remarkable is this article is that the reporter had no understanding how preneed funeral insurance works. She thought the consumer deserved to have her funeral covered.
Many times even the best reporters do not understand preneed.
If the Funeral Professional who sold the policy did not explain the non guaranteed preneed policy, shame shame. Many times people who purchase prepaid funerals just think that because they prepay it is all taken care of. This is not the case.
Putting all this aside the basic problem still exists in this case. The Illinois Funeral Directors Association(IFDA),took stole, mishandled, misappropriated, made bad investments with the people’s preneed money.
Snippet from “Broken trust: Prepaid funeral loss leaves Dixon family puzzled, waiting for answers”:
One such woman is Dixon resident Oma L. Grace, who in 1994 prepaid $6,508.94 for her funeral to Preston-Schilling Funeral Home in Dixon.
Grace, who now is 103 years old, presumed the cash deposit she paid would be used to cover the cost of funeral arrangements when her time came.
Hers is a non-guaranteed contract, meaning that the amount she paid does not guarantee the price for any specific goods or services. It reads: “Any funds paid under this contract are only a deposit to be applied toward the final price of the goods or services contracted for. Additional charges may be required.”
Sixteen years later, Grace and her family have discovered that the reality of her situation was far different from her original intention.
On April 6 of last year, Grace received a statement in the mail from Preston-Schilling listing the total charges for her funeral – $12,537.98.
This amount would not have been reason for alarm if the original balance on her account as of Sept. 29, 2008 – $12,028.01 – had matched its value as of April 6, 2009 – $8,160.35. In 7 months, the balance had decreased more than 32 percent.
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