Pre-paid funeral plan provider expanding as clients lock in to fixed terms
Cheadle based pre-paid funeral plan provider Prosperous Life is experiencing significant growth and will create 30 jobs.
Group revenues, which include Prosperous Life (PL) pre-paid plan purchases – which provide customers with a current-day price lock-in – and revenues contributed by estate planner Prosperous Estate Planning (PEP) are on track for a combined £15m in 2021, of which £10m sits with Prosperous Life.
Group revenues in 2020, following PEP’s summer launch, were £13m.No profits of note have been recorded as funds have been re-invested in call centre staff, compliance infrastructure, procedures and personnel, technology and premises.
The current joint headcount is up from 100 in 2019 to 160 at the start of November 2021.
Customers, whether planning for their own funeral or that of a relative or friend, can pre-pay either the full cost in advance or in instalments.
Payments go into Trust so are assured and protected. From July 2022, the pre-paid funeral industry will come under Financial Conduct Authority (FCA) regulation.
Phil Dunning, finance director at Prosperous Life, said: “The cost of funerals is increasing. What might be a £4,200 funeral in 2020 will cost in excess of £5,000 in 2025, and the upward trend is steady.
“However, the increasing number of pre-paid funeral plans being bought from us actually reflects the market as a whole – it is increasing.
“Fundamentally, a pre-paid funeral plan means a family can lock in a day-of-purchase price for a future funeral, thereby avoiding what are becoming steep increases and a potentially expensive cost at a later date.”
The Prosperous Life customer base continues to grow at approximately 750 per month. The Trust increased from around 3,000 active clients in April 2020, to more than 15,000 by the end of July 2021. This is on track to reach 19,000 by the end of December 2021.
As well as Prosperous Estate Planning – currently turning over £7m per annum on current ‘run rate’ – new sister businesses include Direct Cremations, part of Prosperous Life, launched in July 2021, and which provides pre-paid cremation plans currently selling around 60 plans per week.
An equity release business has recently been launched as part of Prosperous Estate Planning, while a funeral directors’ business operating as a new limited company is planned for a late 2021 or early 2022 launch. It is targeting the opening of 20 sites in the next three years.
Growth and expansion means head office and all administration will move into a separate dedicated building, allowing more growth for both the administration team at HQ, and the call centre team which will remain on the original site.