With people living longer the instance that a power of attorney is used to commence a funeral bond for an elderly relative is increasing. As when dealing with any financial product, certain protocols need to be followed when this occurs. Sureplan Friendly Society Ltd (Sureplan) will wish to sight a copy of the power of attorney and will check to see that the principal’s instructions are being followed. One common cause of misunderstanding occurs when the principal has appointed more than one attorney. The attorneys will either be appointed as “severally” (meaning that they can act individually), “jointly” (meaning all must act) or “other” which often instructs the attorneys to act in a prescribed succession e.g. a principal might appoint their partner in the first instance with the ability to act severally, but in the event of their partner not being available or unable to act (deceased or lacking mental capacity), they might appoint their children to act jointly. The reason a nominated attorney is unavailable or unable to act needs to be verified. Sureplan also requires the attorney/s to declare that the power of attorney document being used is current.
As from 1 January 2021 all funeral bond funds will be “financial products” under the Corporations Act 2001 and therefore subject to the same provisions as other financial services including deposit accounts, general and life insurance, and superannuation funds.