UK Funeral Plan Market 2026: Sales rising, regulatory reviews, consumer attitudes and the emergence of ‘hybrid’ plans

The regulated funeral plan market now appears materially more stable than during the immediate aftermath of FCA authorisation. New funeral plan sales in 2025 recovered to more than 206,000 plans according to NAFPP data, placing the market back near historic peak levels and above the five-year average recorded before regulation.

For many providers, regulation is now increasingly viewed as “business as usual”, albeit with significantly higher operational and distribution costs than existed previously.

However, while the market itself appears more stable, distribution within the market continues to shift.

Our latest independent funeral director research shows that almost a quarter of funeral directors no longer sell funeral plans – a substantial change from the pre-regulation market. This raises important questions around consumer access, local distribution, and the long-term role of independent funeral directors within funeral planning.

As anticipated in our previous reports, direct cremation funeral plans now represent the clear majority of new plan sales.

The market has increasingly evolved into a direct cremation-led market, with providers continuing to refine propositions, pricing structures, payment options and customer journeys. At the same time, competition continues to intensify.

Pure Cremation remains the dominant force in the direct cremation market and continues to shape wider market behaviour, particularly in relation to direct response marketing and customer acquisition techniques. However, competition across the wider market continues to intensify.

Importantly, our research suggests the competitive battleground is no longer simply about unattended direct cremation alone.

One of the most significant themes explored in this year’s report is the growing emergence of what we describe as “Hybrid” funeral plans.

These propositions sit between a fully unattended direct cremation and a fully traditional funeral. They include smaller attended services, simplified funerals, and more intimate lower-cost alternatives that still allow families to gather and mark a death in a meaningful way.

In practice, these plans appear to reflect broader shifts in consumer attitudes towards funerals.

Our research suggests many consumers are increasingly seeking funerals that are:

• lower key
• less performative
• simpler in format
• more affordable
• but still attended and meaningful

This emerging segment may prove to be one of the most important areas of future market development.

While many traditional providers remain heavily focused on defending their traditional propositions, a number of direct cremation-led firms are increasingly expanding into this “middle ground” between unattended cremation and fully traditional funerals.

The report explores whether this Hybrid category may ultimately become a major area of substitution and growth within the UK funeral market.

Alongside the continued growth of funeral plans, one of the clearest longer-term themes identified within our research is the changing relationship between the funeral plan and Over 50s markets.

In last year’s report, FSE highlighted the likelihood that funeral plan and Over 50s sales trends would continue to converge. That trend appears to have accelerated further over the past 12 months, driven by a combination of stronger funeral plan sales, changing consumer preferences and growing regulatory scrutiny of the wider pure protection market.

While Over 50s products remain highly significant within the end-of-life funding landscape, the balance between the two sectors now appears materially different from only a few years ago.

Alongside developments within funeral plans themselves, our report also examines the FCA’s ongoing Pure Protection Market Study and what it may mean for the wider funeral funding landscape.

Over 50s guaranteed acceptance life insurance remains widely used by consumers as a means of funding funeral costs. However, FSE continues to believe that funeral plans generally provide a more effective and certain solution for consumers seeking advance funeral provision.

The FCA’s interim findings published earlier this year acknowledged several issues within the Over 50s market, including poorer value outcomes compared to underwritten life insurance. However, we believe important questions remain around:

• cancellation outcomes
• affordability pressures
• nil surrender value
• benchmark-driven overspecification
• and ongoing consumer confusion between funeral plans and life insurance products

The report examines these issues in detail, together with the implications of the forthcoming FCA review of the Funeral Plan Conduct of Business framework (FPCOB).

This year’s report also includes new independent consumer insight exploring attitudes towards funeral planning and funeral preferences.

The findings reinforce the continued shift away from highly traditional funeral expectations. Direct cremation remains highly significant, but many consumers also appear increasingly open to attended but simplified funeral options.

The report also explores:

• trust and confidence within the market
• purchase drivers
• consumer understanding of funeral plans
• attitudes towards funeral directors and online providers
• and the continuing impact of the Safe Hands scandal on confidence in funeral planning

Overall, our 2026 report concludes that the funeral plan market is no longer simply a story about regulation and direct cremation.

Instead, the sector is entering a more mature and strategically important phase characterised by:

• rising sales
• proposition diversification
• growing investment interest
• changing consumer expectations
• and increasing regulatory focus on adjacent markets

At the same time, there remain important unresolved questions around consumer outcomes, distribution, value and market structure.

As ever, our aim is to provide an independent and evidence-led perspective on how these trends are shaping the future of funeral planning in the UK.