Is a Prepaid Funeral Plan treated as Capital for income based ESA?

In CPAG book for UC there is a specific section that states that the value of a Funeral Payment Plan is ignored, the same for disregarded capital over pension age. But for income based benefits under pension age (in this case income based ESA) CPAG book is silent about Funeral plans, suggesting they are not ignored.

Is this right or am I missing something? Doesn’t seem right and not my recollection from a previous case I dealt with a number of years ago, however I have been wrong before…...

I think I looked at this once before and I think you’re correct that they’re not disregarded for MTB’s for people under pension age, unlike with PC.

I have a vague memory that some of these are insurance based and some of them are savings schemes.  I suspect that may make a difference, as will the question of whether they can be accessed.

I can’t see any reference to them in Schedule 9 of the ESA Regs (disregarded capital) but the Entitled To website states that the value of a pre-paid FP is disregarded https://www.entitledto.co.uk/help/savings

Perhaps email them and ask where this comes from?

logically

if it is an insurance based scheme it will only pay out when the person in fact dies, not before - there is no fund for anyone to draw on at all because all that has been paid is a premium to insure for a specified future event.

if it is a savings or similar type thing it’s going to be subject to scheme terms - and mostly, they will say you can have it when you die and your family put a claim in to have your funeral paid - but you would need to look at the scheme terms to know for certain….

none of which would stop the DWP saying its capital (in the same way they say that someone with a house worth absolutely nothing has capital) which you would then need to prove has no current value.