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  2. Australian Unity’s funeral bond set to disrupt market

Australian Unity funeral bond set to disrupt market

Media Release
25 Jul 2017

Australian Unity today launched an innovative new investment product FuneralPlan Bond. With growth-oriented investment options the Bond is designed to provide returns greater than inflation and an option for investors not requiring a capital guarantee.

Unlike any existing product in the market, the FuneralPlan Bond provides two new investment alternatives for investors—moderate and conservative options—that are linked to the performance of financial markets, in addition to the existing capital guaranteed option.

Greg Bird, National Manager – strategy, at Australian Unity, said the new moderate and conservative options were designed for those wanting to access investment options that were likely to outperform the traditional capital guaranteed portfolio.

“While the capital guaranteed investment option is a low risk option in the short term, the risk is the value of the bond may not keep up with the impact of inflation over a longer time frame,” Mr Bird said.

“Funeral costs continue to rise, so it is important to generate the level of growth in the policy value anticipated for covering the costs of a funeral when the service is needed.

“The longer we remain in a low interest environment, the greater the impact to a capital guaranteed option in maintaining the level of growth required to meet longer term objectives.

The FuneralPlan Bond’s conservative investment option is designed for those wanting a combination of capital growth together with relatively stable returns, while the moderate investment option has a higher level of variability in returns along with higher potential returns. Both options are better suited for a longer-term horizon, and typically funeral bonds are held for 7 years or more.

The FuneralPlan Bond also provides an opportunity to tap into new markets, according to Mr Bird.

“Traditionally funeral bonds had a limited structure and market and were sold to senior Australians seeking to meet future funeral expenses with the security of a capital guarantee”, he said.

“The appeal to seniors is bolstered by tax and pension consessions attached to funeral bonds”

“Establishing an alternative growth style investment option may provide an incentive for a younger market to consider a funeral bond product”, he said.

Mr Bird said the FuneralPlan Bond with growth options was the result of extensive industry and market research.

Important information
The issuer of the FuneralPlan Bond is Lifeplan Australia Friendly Society Limited, ABN 78 087 649 492, AFS Licence No. 237989, a leading provider of tax effective investment products such as investment bonds, education bonds and funeral bonds. The Disclosure Document is available via the website at, and the information in this document is general information only and does not take into account your personal objectives, financial situation or needs.

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For more information please contact

Greg Bird

National Manager, Strategy

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