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Scottish Credit Unions and pensioners betrayed as funeral plans axed

The Scottish Pensioners’ Forum, the campaigning organisation for older people in Scotland has said thousands of older Scots have been blindsided by the abrupt collapse of funeral insurance policies sold through Scottish credit unions. The Family Protection Plan (FPP), underwritten by Maiden Life Försäkrings and brokered by C Mutual, is being pulled by the end of November—leaving long-standing policyholders with nothing to show for years of payments.

This shock decision has triggered widespread fury. Credit unions, pensioners’ organisations, and MSPs are demanding answers, calling the move “immoral,” “callous,” and “a betrayal of trust.” Many affected are elderly, on low incomes, and now face being uninsurable due to age or health—stripped of the dignity and security they were promised.

David Edwards, Chair of the Scottish Pensioners’ Forum, condemned this decision: “Older people have paid in thousands over the years. Now they’re being told they’ll get nothing. It’s disgraceful. The rug has been pulled from under them. Someone must be held accountable.”

Some credit unions had even embedded FPP premiums into members’ savings plans. One Lanarkshire union reportedly invested over £1.3 million of client funds into the scheme. Now families are left scrambling for alternatives, many of which are unaffordable or simply out of reach and have the potential to plunge them into debt.

David continued: “This scandal has already reached the Scottish Parliament. Glasgow MSP Paul Sweeney has called on the First Minister to act and we support this action.

“We also are calling for a meeting of the cross-party group on funerals and bereavement to take place as a matter of urgency in order to address this matter. People have paid more than the cost of a basic funeral yet they’re being left with nothing. There must be redress. There must be answers.

“The Scottish Pensioners’ Forum urges the First Minister, and the Cabinet Secretary for Finance and Local Government, to support the credit unions and demand that the FCA carries out a thorough investigation.”

The Scottish Pensioners’ Forum, alongside other campaigners, is calling for urgent action to restore coverage or provide compensation. But with Maiden Life not directly regulated by the Financial Conduct Authority (FCA), many fear justice may be out of reach.

The Credit Union Coalition is demanding a full investigation, citing serious failures in oversight and due diligence. The withdrawal of cover at a time of greatest vulnerability is a direct violation of consumer protection principles.

“Despite years of work to tackle funeral poverty in Scotland, this scandal drags it back into the spotlight. Families are being forced to confront the unthinkable. We must unite and fight for justice for every person affected.”