Alabama Senate Bill SB131

Alabama 2023 Regular Session

• Introduced: 3/22/23
• Refer: 3/22/23
• Report Pass: 4/5/23
• Engrossed: 4/6/23
• Refer: 4/6/23
• Report Pass: 4/12/23
• Enrolled: 4/20/23
• Passed: 4/20/23

Caption

Relating to the Alabama Board of Funeral Service; to amend Section 34-13-1, as amended by Act 2022-339, 2022 Regular Session, Sections 34-13-20, 34-13-21, and 34-13-22, Sections 34-13-23 and 34-13-27, as amended by Act 2022-339, 2022 Regular Session, Code of Alabama 1975, to rename the Alabama Board of Funeral Service as the Alabama Board of Funeral Services and to provide further for definitions and the membership of the board; to add Article 5 to Chapter 13, Title 34, Code of Alabama 1975, by amending and renumbering Sections 27-17A-1, 27-17A-3, 27-17A-4, 27-17A-10 to 27-17A-25, inclusive, 27-17A-30 to 27-17A-34, inclusive, and 27-17A-40 to 27-17A-57, inclusive, as Sections 34-13-170 to 34-13-172, inclusive, 34-13-190 to 34-13-206, inclusive, 34-13-230 to 34-13-234, inclusive, and 34-13-260 to 34-13-277, inclusive, Code of Alabama 1975; to establish the Alabama Preneed Funeral and Cemetery Act of 2023; to transfer the existing Preneed Funeral and Cemetery Act, and the regulation of preneed contracts, from the Commissioner and Department of Insurance to the Alabama Board of Funeral Service; to authorize the Department of Insurance to temporarily transfer certain funds to the board to defray costs associated with the administration and operation of the Alabama Preneed Funeral and Cemetery Act of 2023; and in connection therewith would have as its purpose or effect the requirement of a new or increased expenditure of local funds within the meaning of Section 111.05 of the Constitution of Alabama of 2022.

Impact

The bill significantly affects preneed sales practices by ensuring that all funds received under such contracts are managed with additional oversight and accountability. It mandates the establishment of trust funds that protect consumer contributions until services are rendered, aiming to prevent fraud and protect consumers’ interests. This modification seeks to enhance transparency in how preneed contracts are handled, complicating processes for preneed sellers but ensuring greater consumer safeguards. The Act strengthens local laws by incorporating stricter guidelines for preneed sales agents and setting forth clearer definitions of rights and responsibilities.

Summary

Senate Bill 131 aims to amend and rename existing regulations related to the provision of preneed funeral sales in Alabama. It officially establishes the Alabama Preneed Funeral and Cemetery Act of 2023, transitioning oversight from the Department of Insurance to the Alabama Board of Funeral Services. The bill seeks to enhance regulatory frameworks surrounding preneed contracts, which include arrangements for funeral and cemetery merchandise and services provided before death. The redefined board will have increased authority over licensing, trust fund management, and compliance monitoring to protect consumers purchasing these services in advance.

Sentiment

Sentiment around SB131 appears generally supportive, particularly among consumer advocacy groups who argue that increased regulation is necessary to protect vulnerable populations making advance purchases for their funeral arrangements. However, there are concerns from some in the funeral service industry about the potential for increased administrative burdens and costs associated with compliance. Many industry stakeholders have expressed admiration for the intent of the bill while advocating for sensible regulations that do not stifle business operations.

Contention

Notable points of contention include the balance between regulatory oversight and operational flexibility for funeral service providers. Some employers within the industry believe the enhanced regulations could lead to increased prices for consumers, as costs associated with compliance might be passed down. Others argue that these changes could improve the quality of service offered by ensuring that preneed providers manage clients' funds responsibly and maintain high standards in their practices. The act evokes discussions surrounding consumer rights against the operational freedoms of businesses in this sensitive sector.