What is required if a purchaser cancels a preneed contract?

In Missouri, if a purchaser cancels a preneed contract, the law requires the funeral service provider to return the cash surrender value of any insurance policy that was associated with the contract. This means that when a pre-arranged funeral plan is cancelled, the individual is entitled to recover the financial benefits that they have accrued in relation to the insurance policy, rather than a full refund of all their payments or other options.

This policy is designed to protect both the consumer and the business. The cash surrender value reflects what the policy is worth at the time of cancellation, ensuring that the purchaser does receive some financial compensation while also acknowledging the cost of administration and services that might have been provided up until that point.

Understanding this aspect of preneed contracts is crucial as it directly influences the financial outcomes for customers who may change their minds about their funeral arrangements, allowing them to retrieve some portion of their investment through the insurance policy's surrender value. This highlights the importance of being aware of how contracts are structured and what rights consumers have in situations where preneed contracts do not meet their needs.