45:7-85 Requirements for prepaid funeral agreements.

4. Every prepaid funeral agreement executed in this State shall:

a. Be signed by the provider, and the purchaser or the intended funeral recipient or the intended funeral recipient's guardian, agent or next of kin.

b. Include at least the following information:

(1) the name, address and telephone number of the mortuary to be utilized;

(2) the name of the individual licensee acting as or on behalf of the provider and the license number of that individual;

(3) the purchaser's name and address;

(4) the name of the intended funeral recipient;

(5) whether the agreement is a guaranteed price agreement or non-guaranteed price agreement, which term, as applicable, shall be defined in the agreement in accordance with section 1 of this act;

(6) how the agreement is to be funded; and

(7) a statement of funeral goods and services or, if not included as part of the agreement, that a statement of funeral goods and services shall be provided.

c. Provide that all funeral arrangements are revocable, and that all funeral funding arrangements are severable from those funeral arrangements by the purchaser if alive, and if not, then by the intended funeral recipient, where they are different persons. Upon the death of both the purchaser and the intended funeral recipient, the intended funeral recipient's next of kin, in the order provided in N.J.S.8A:5-18, shall have the right to revoke the funeral arrangements and to sever the funeral funding arrangements from the funeral arrangements. Notwithstanding the above, a prepaid funeral agreement may provide that the funeral trust shall be irrevocable during the lifetime of the intended funeral recipient pursuant to section 1 of P.L.1991, c.502 (C.2A:102-16.1) or section 1 of P.L.1999, c.193 (C.2A:102-19).

In those instances where a revocable prepaid funeral agreement is revoked, the moneys used to fund the agreement shall be paid to the purchaser, if alive, and if not, then to the personal representative or estate of the deceased purchaser if the agreement is funded through a trust or, if the agreement is funded through a funeral insurance policy, to the named beneficiaries on the insurance policy or annuity.

d. Provide that, unless otherwise specified therein, a prepaid funeral agreement anticipates the provision of prepaid funeral goods and services in the area served by the provider. The agreement shall further provide that, if the intended funeral recipient's place of death is in a location other than that served by the provider, alternative funeral arrangements will be necessary.

e. Provide for the provider's substitution of any goods or services to be furnished or rendered thereunder for goods of equal quality, value and workmanship or services of equal quality and value in the event of the unavailability of any goods or services set forth in the agreement. Any changes in the price of the agreement resulting from such substitution of goods or services shall be reflected in the statement of funeral goods and services rendered.

f. Provide that, in the case of an agreement funded through a funeral trust, if the purchaser predeceases the intended funeral recipient where they are different persons, then the intended funeral recipient shall automatically assume the legal right to administer the funeral trust as purchaser, including the right to withdraw any and all funds held in the funeral trust, along with all other rights formerly held by the purchaser.

g. Provide that, upon the death of the intended funeral recipient, the provider shall calculate the current retail prices of the preneed funeral arrangements, and:

(1) in the case of a non-guaranteed prepaid funeral agreement, if there are insufficient funds to pay for the current retail prices of the prepaid funeral goods and services requested, the provider shall consult with the appropriate representative for the supplementation of the funds or the modification of the funeral arrangements set forth in the agreement prior to performance under the agreement.

(2) in the case of an agreement funded through a funeral trust, whether a guaranteed or non-guaranteed price agreement, if the provider determines that the funds or proceeds available exceed the current retail prices of the prepaid funeral goods and services to be provided, the surplus funds shall be paid to the purchaser, if alive, and if not, then to the personal representative of the estate of the deceased.

(3) in the case of an agreement funded through a funeral insurance policy, whether a guaranteed or non-guaranteed price agreement, if the provider determines that the funds or proceeds available exceed the current retail prices of the prepaid funeral goods and services to be provided, the surplus funds shall be paid to the named beneficiaries of the funeral insurance policy.

h. Provide that, upon completion of performance under the agreement, the provider shall present a final bill.

i. Provide that if a prepaid funeral agreement is a guaranteed price agreement, the price guarantee is a guarantee and liability of the provider and not the guarantee and liability of the insurer issuing the funeral insurance policy when a funeral insurance policy is used or the trust depository administering the funeral trust when a funeral trust is used.

L.1993,c.147,s.4; amended 1999, c.193, s.9.