The Competition and Markets Authority could launch an investigation into the UK funeral market.
Following a study starting six months ago, the watchdog said that it has “serious concerns” with the sector over the high price hikes.
Over the past ten years, prices have increased by as much as 66% and “problems with the market that have led to above-inflation price rises for well over a decade”.
The CMA said: “The scale of these price rises does not currently appear to be justified by cost increases or quality improvements.”
Whilst customers are able to save a significant amount of money if they shop around, the CMA was aware that “people organising a funeral are usually distressed and often not in a position to do this – making it easier for some funeral directors to charge higher prices. Prices are also often not available online, making it difficult to compare options.”
Ian Strang, the founder of funeral comparison site Beyond, has said that the investigation cannot come soon as funeral prices have allowed to go unchecked.
The cost of organising a funeral has increased to between £3,000 – £5,000.
Andrea Coscelli, chief executive of the CMA, said:” People mourning the loss of a loved one are extremely vulnerable and at risk of being exploited.”
“We need to make sure that they are protected at such an emotional time, and we’re very concerned about the substantial increases in funeral prices over the past decade.”
“We now feel that the full powers of a market investigation are required to address the issues we have found. We also want to hear from people who have experienced poor practices in the sector, so that we can take any action needed to fix these problems.”
The biggest providers in the market are currently Dignity (LON: DTY) and Co-op funerals.
Shares in Dignity have tumbled 15.74% on news of the CMA investigation (0943GMT).
Dignity chief executive, Mike McCollum, said: “We look forward to our continued work with the CMA and other industry bodies to ensure we take the necessary steps to protect consumers and improve quality and standards across the industry.”
