April 4, 2002 |
2002-R-0412 | |
IRREVOCABLE FUNERAL SERVICE CONTRACTS | ||
By: Daniel Duffy, Principal Analyst | ||
You asked for a history of the monetary limit on the size of an irrevocable funeral service contract.
DISCUSSION
The statutory limit on the amount that can be placed in an irrevocable service contract was established in 1986 when the law first authorized such contracts (PA 86-290).
Table 1 displays the amount of the cap since 1986. The legislature raised the cap five times. It was $ 2,000 in 1986 and is $ 5,400 today. It is 2. 7 times what it was in 1986.
Table 1: Statutory Cap on the Amount of an Irrevocable Funeral Service Contract
YEAR |
CAP ($ ) |
|
1986 |
2,000 |
Effective July 1, 1986 |
1987 |
2,200 |
Effective July 1, 1987 |
1988 |
2,400 |
Effective July 1, 1988 |
1988 |
3,600 |
Effective October 1, 1988 |
1989 |
3,600 |
|
1990 |
3,600 |
|
1991 |
3,600 |
|
1992 |
4,800 |
Effective October 1, 1992 |
1993 |
4,800 |
|
1994 |
4,800 |
|
1995 |
4,800 |
|
1996 |
4,800 |
|
1997 |
5,400 |
Effective July 1, 1997 |
1998 |
5,400 |
|
1999 |
5,400 |
|
2000 |
5,400 |
|
2001 |
5,400 |
|
2002 |
5,400 |
From 1986 to 1997, the cap was set by reference to the funeral allowance for beneficiaries of public assistance programs (CGS Secs. 42-207 & 17b-84). The 1986 act set it at twice the funeral allowance. The legislature increased the funeral allowance in 1987 and 1988, thereby increasing the irrevocable funeral service contract cap. The legislature increased the cap again in 1988 when it raised it from twice to three times the funeral allowance. The legislature increased the cap to four times the funeral allowance in 1992 and raised it to $ 5,400, the current cap, in 1997.
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