FTC'S FUNERAL RULE AIDS PLANNING IN TIME OF GRIEF
JEFF HANSEN News staff writer
Last fall, Sandra Holliman had to purchase funeral services for
her 76-year-old husband after he unexpectedly died.
she said the salesman at Southern Heritage Funeral Home had a professional
manner, she found his talk about prices of services and caskets
confusing. And when he listed on her purchase agreement a $350 charge
for flowers she did not want and a $245 charge to drive flowers
one-third of a mile from the funeral home to the cemetery, Holliman
- herself a flower delivery driver for Hoover Florist - said, "That's
she turned and told her daughter: "I just want to get out of
the time the Pelham woman left, she had a purchase agreement to
pay $7,874 for her husband, Walter's, funeral, but little understanding
of how that bill was made up.
and her employer, Bebe Morgan, later complained to the Alabama attorney
general's office and the Federal Trade Commission, and Holliman
got a refund of $350 for the unused flowers.
many consumers, Holliman was not prepared for the day she had to
plan her husband's burial.
Heritage is operated by Houston-based Service Corporation International,
which calls itself the largest provider of funeral and cemetery
services in the world.
the metro Birmingham area, Service Corporation International also
operates Southern Heritage Cemetery, Lackey Floral, Ridout's-Brown-Service
Roebuck Chapel, Ridout's Valley Chapel, Johns-Ridout's Mortuary-Elmwood
Chapel, Elmwood Cemetery and Mausoleum, Johns-Ridout's Funeral Parlor,
Highland Memorial Gardens, Ridout's Forest Hill Cemetery, and Ridout's
Forest Crest Cemetery. Service Corporation International also has
seven funeral homes or cemeteries in Montgomery, five in Tuscaloosa
and four in Mobile.
Service Corporation International operates 2,236 funeral service
locations, 429 cemeteries and 190 crematoria in the United States
and seven other nations. Catherine Colbert, a business analyst for
Hoover Inc., has said Service Corporation International is to death
as H&R Block is to taxes. Unfamiliar territory
the consumer, on the other hand, buying funeral services is an unfamiliar
business transaction. Consumers may arrange a funeral once every
15 years on average, and many - like Holliman - make the purchase
while feeling grief and a sense of urgency.
help consumers get clear information, the Federal Trade Commission
developed regulations commonly called the Funeral Rule. Funeral
homes must offer customers a general price list that helps them
pick and choose certain services. The Funeral Rule also prohibits
a variety of unfair or deceptive practices, and it requires funeral
homes to accept, at no extra fee, caskets or urns that the consumer
has bought elsewhere.
guidelines to funeral homes say that early in the business transaction,
funeral homes "must physically offer consumers a General Price
List that they can keep and take home with them."
said she was never offered or given the price list, and she said
her daughter has the same recollection. Mike Hauser, market director
for Service Corporation International in the Birmingham area, disagrees
talked to the director who handled the arrangement, and he said
he did give her a general price list," Hauser said. "He
said he always gives it to them before he goes in the arrangement
room . . . I am confident there is nothing illegal happening and
everything is in accord with federal and state law." Hauser
also said his company follows all FTC regulations.
general price list from a Service Corporation funeral home on Southside
lists individual funeral services and goods. The nine-page document
also lists a series of trademarked "Dignity Memorial"
packaged funeral or cremation plans. The funeral package price includes
the services, a selection of caskets and vaults, as well as Holliman's
unwanted flowers and items like a picture frame, 100 acknowledgment
cards and access to a 24-hour compassion helpline.
final purchase agreement with the funeral home first itemized all
of her individual goods and services, at prices taken from the general
price list. The total was $9,459. Beneath that, under a section
called "Other," the funeral director subtracted $1,585,
and wrote next to it, "Tribute Savings."
Holliman had bought was a package called the "Dignity Memorial
Tribute Funeral Service Selection." She said it was unclear
there was any package until she questioned some of the itemized
prices, especially for flowers. Package plans
Mack, an FTC spokeswoman in Washington, said funeral homes can offer
packages and can deny substitutions from that package.
don't try to say what funeral homes should be charging," Mack
said. "We say the consumer must be informed up front. They
have the right to pick and choose."
said the package plans provide benefits and value for customers,
but substitutions are not allowed. In reports to investors and in
filings to the federal Securities and Exchange Commission, Service
Corporation International says its package plans can add revenue.
Compared with non-Dignity plans, the company said, the Dignity Memorial
packaged cremation plan adds $1,700 of revenue per cremation service,
and the Dignity Memorial packaged funeral plan adds $2,700 of revenue
per funeral service.
four Dignity Memorial package plans offered by Service Corporation
range from $7,595 to $12,795, according to the price list from Johns-Ridout's
Funeral Parlor. Holliman had the lowest priced plan (her additional
costs on the purchase agreement were for obituary notices and music).
the general price list only gives the range of prices for caskets
and outer burial containers, the funeral home must also offer a
casket price list and an outer burial price list when it begins
discussing those items with the buyer, and before showing the buyer
any of the caskets or containers. "Customers must be able to
look at the price list before discussing their options or seeing
the actual caskets (or containers)," the FTC says in its guidelines
to funeral homes. "Consumers should not first learn of casket
prices by entering the casket showroom and reading price cards placed
on individual caskets or by having the funeral director recite such
FTC also says consumers must be allowed to buy caskets and outer
burial containers elsewhere, and the Internet has made it much easier
to shop for such items. Southern Heritage's listed prices for Holliman's
casket ($2,245) and outer burial container ($1,795) totaled $4,040.
Through the Internet, the same casket and outer burial container
could be bought (including rapid shipping to the funeral home) for
a total of $1,958 at Florida Funeral Home's casketinfo.com
or for $2,140 at Funeral Depot.
Federal Trade Commission's consumer guide on funerals can be found
on the Internet at www.ftc.gov/bcp/conline/pubs/ services/funeral.htm.
Holliman, above, a driver for Hoover Florist, and her boss, Bebe
Morgan, complained to the Federal Trade Commission about charges
associated with a funeral for Holliman's husband.
NEWS STAFF/STEVE BARNETTE