What is the requirement for a funeral home to sell insurance-funded preneed?

A funeral home must be a licensed seller to legally offer insurance-funded preneed services. This requirement ensures that the funeral home adheres to state regulations and safeguards the interests of consumers purchasing preneed contracts, which are often complex financial products linked to funeral services. Licensing provides a level of accountability and standardization in how these services are provided, requiring the funeral home to comply with state laws regarding preneed funeral contracts, including disclosures, record-keeping, and financial management.

This requirement helps protect consumers from fraud and ensures that their funds will be appropriately managed and used for the intended purpose when the time comes. Without proper licensing, a funeral home would not be recognized as a legitimate provider of these services, which could lead to legal complications and consumer distrust.