Cheaper Covid-19 funerals hurt Dignity’s bottom line

Funeral services have been stripped back during the coronavirus crisis as big send-offs were banned to slow the spread of the disease, new data from funeral provider Dignity shows.

Dignity said that the proportion of “simple and limited service” funerals it performed tripled in April, May and June.

During the same months last year, only 13% of people chose one of the simple and limited funerals for their loved ones, while 53% picked Dignity’s more expensive “full service”.

However, that split was almost flipped in the second quarter of this year, as 37% of people chose the simple, and only 26% the full service, Dignity said on Wednesday.

It meant that despite a large rise in the number of funerals, with deaths up 47% to 207,000, Dignity’s profit took a hit.

The £58.3 million profit the funeral provider registered in the second quarter of 2019 was swapped for a £13.6 million loss this time around.

The simpler funerals are much less expensive than the full service. Last year Dignity made almost £3,600 from each full service, but only £2,047 from the simpler plan.

It also made a lot less money on flowers and other ancillary items, £49 on average, compared to £233 this time last year.

More people died in the last quarter than at any point in the last two decades, Dignity said.

But the business did not capitalise on the increase, partly because of the simpler plans.

However, it also cost Dignity a lot more to run the services, as keeping up safety measures proved costly.

All the £5.5 million benefit Dignity got from business rates relief “and more” was used to buy personal protective equipment (PPE) to keep staff and clients safe, it said.

It also hinted that Covid-19 may hurt the business’s long-term prospects as the number of deaths might be lower in 2021 and 2022 than they were last year.