What were you hoping participants would gain from this webinar?
“I hope they recognized the importance of taking a closer look at their payment policies and procedures because, as I told participants, there is a real opportunity to create additional revenue, if they have a strong and understandable policy. This is an aspect of the arrangement process that is often overlooked.”
Do you come from a funeral service background?
“Yes, after mortuary school, I worked for three different groups of funeral homes during the course of about ten years. So I had the opportunity to work in different environments under different types of ownership and management. I could compare the way the funeral homes were run as well as what worked and didn’t work. From there, I sold Wilbert burial vaults and was able to work with more funeral homes in that capacity. During the last five years, I’ve worked in the insurance assignment area with C&J Financial. Those different experiences have molded some of the information I’m able to share today with funeral home owners.”
Are many funeral directors really unprepared to talk about money during the arrangement conference?
“First of all, I believe funeral service is a calling. Funeral directors are called to serve families and help them through the process of death and grief. I think everything in their professional world is based on that being the highest priority. So the business and financial aspects of running a funeral home can be very difficult for most of them.
“I think mortuary school prepares us for a lot. But when we get into real-world situations with bereaved families, it’s just hard to talk about money. It’s different if we are selling something that people really want. But, given a choice, families would rather not be in an arrangement conference; they don’t want to have to buy our goods and services. Being sensitive to this, as funeral directors, we usually want to get past the talk of money as quickly as we can and move on to serving that family. That’s one of the reasons why it is so very important to have a strong payment policy in place.”
What are the hallmarks of a good payment policy?
“It should be more than just a list of accepted payment methods. At its best, it should provide structure and a set of expectations. A well structured payment policy lifts the veil of uncertainty for families carrying both the burden of losing a loved one as well as a financial obligation. And not only do families better understand their part of the bargain, but your arrangers also understand exactly what is expected of them during financial discussions.
“It’s important that the arrangement staff sits down from time to time to practice the discussion of payment options. Role playing exercises can help them become more comfortable with explaining the payment policy, asking for money and collecting it. Managers should have conversations with their funeral directors and administrative staff to determine if there are any areas of deficiency and how the whole process can be tightened up, so there are no gray areas, and everyone is on the same page.
“When I was a young funeral director, I worked at a firm that had no real payment policy. It was very vague and made my work very difficult. I then worked for a funeral home that had a strict payment policy. The structure made it easy for me to navigate through it with families. My confidence grew, and families understood their options. I went from having a lot of trouble collecting money to little or no trouble, because there was structure.”
Can you share some of that structure?
“Something that was very effective was giving the family a list of bullet points during the first call—things they would need to bring in to the arrangement conference. The last point was to bring in any insurance policies, so we could help look them over and process them if desired. But we took that a step further when we were scheduling the conference and asked if they would need a little extra time to gather those documents. We wanted to find out up front, in a polite way, how they were planning to pay for services. And so, the groundwork already had been laid for discussing payment at the arrangement conference. The insurance or payment information was woven in with all the other information we needed to collect.
“And this is far better for families than walking into the arrangement with uncertainty as to how they are going to pay. If they feel they may have to pay out-of-pocket, then their interest in service options is going to be more limited. Data we have collected from more than 750 funeral homes and more than 10,000 funerals shows families using insurance to pay for a funeral spend 31% more than families paying with cash, check or credit card. And we’ve learned that our data is very close to what Graystone Associates is seeing—about 29%. But this opportunity only exists if the funeral home’s payment policy allows the arranger to become aware of insurance as soon as possible in the process—before a family starts picking the services, casket, vault or anything else.”
Is insurance assignment becoming a viable option for more funeral homes?
“It is! More and more firms that once saw little reason to use a service like C&J Financial, mainly because they didn’t understand how we can help them, are now coming to us. One of the reasons is that insurance companies are getting harder to deal with, and it can take longer for funeral homes to get their money.
“C&J Financial can take a lot of the burden off the funeral home staff when dealing with the insurance process. And more importantly, we can create a more predictable cash flow which gives the funeral home some breathing room. Owners should understand that a cash flow problem doesn’t necessarily mean the business is desperate for money. Anytime you have cash that’s owed to you and is not deposited in your account, it’s not working for you. Every business can benefit from reducing its receivables. And many owners are finding that if they can get their money sooner, they can take advantage of early-pay options and discounts from their vendors.”
How do you recommend a funeral home handle the fee charged by funding companies?
“We recommend the cost be passed along to the client family as an insurance processing fee. It’s a service that you provide, and there should be a fee associated with it. We fully understand that some funeral directors are uncomfortable with this, but here’s where a strong payment policy can help.
“The policy is the glue that holds everything in the structure together, whether it be payment by check, credit card or insurance assignment. So, the insurance processing fee just becomes part of the payment discussion with families. Some have the means to write a check or pay by credit card, so they will choose not to pay the processing fee. But for the families bearing a financial burden, an insurance policy is their only saving grace. Not having to pay out-of-pocket is a huge value and weight lifted off of them. And the fee rarely becomes an issue, unless the funeral director inadvertently makes it one, because he or she does not have the support of a strong payment policy.
“As a Premier Preferred Partner with Selected, we will fund up to $25,000 at no charge to the member firm in its first 30 days. That’s a great incentive to give us a try and see what we can do. One thing I hear repeatedly from funeral home owners who were reluctant to use us at first is, ‘I wish we would’ve done this a long time ago!’ Plus, C&J Financial can help our clients improve their payment policies and offer ways to build staff confidence, in order to overcome the challenges of talking about money and improve the company’s bottom line.”