The funeral industry has welcomed the decision to review the laws governing the sector, saying many service providers are corrupt and exploitative. The review will be conducted by the Reserve Bank of South Africa Prudential Authority and the Financial Services Industry Supervisory Authority (FSCA).
According to Johan Rousseau, president of the National Funeral Directors Association, the 75 000 funeral businesses in the sector, most of which are unregistered, are not adequately monitored. There are about 36 laws regulating the sector, including the Health Act, the Financial and Intermediary Services Act, the Insurance Act and the Basic Conditions of Employment Act. This multiplicity of legislation makes it difficult to adequately supervise the sector.
The authorities have acknowledged that problematic practices exist in the industry, including the transfer of insurance portfolios between funeral directors without the consent of clients and the unauthorized underwriting of insurance policies by unlicensed entities.
These practices put consumers at risk and increase the emotional distress of families who are unable to provide a dignified burial for their loved ones. Regulation of the industry is crucial to protect customers and ensure quality service.
A regulatory authority should be established to enforce all legal requirements for operating a funeral director. In addition, an industry ombudsman could be established to handle consumer complaints.
Pheko Methola, Founder of the Progressive Funeral Practitioners Association of South Africa, highlighted the barriers that small businesses in the industry face when compared to some larger funeral director associations. It is essential to prevent unfair competition and favouritism towards larger players in the market.
In conclusion, stricter regulation and better supervision of the funeral industry are necessary to protect consumers, promote healthy competition and ensure quality funeral services. It is time to put in place effective measures to combat corruption and harmful practices that are detrimental to bereaved families.