If a funeral home goes out of business or misappropriates prepaid funds; what will happen?
It would depend on whether the funeral home was a licensed seller. If the funeral home held a valid permit when the prepaid funeral contracts were sold, the Department of Banking would take over the contracts and find a subsequent provider. The Prepaid Funeral Guaranty Fund would cover any shortages to the fund. The purchaser would not suffer a financial loss. However, if the funeral home was an unlicensed seller, the Department of Banking will take actions in coordination with the local District Attorney to try to recover the prepaid funds through restitution. The purchaser can suffer a financial loss in this situation because the Prepaid Funeral Guaranty Fund cannot be used.
