Funeral industry bucks economic downturn

By Barbara Liston

ORLANDO, Florida (Reuters) - Business is holding steady for the U.S. funeral industry as consumers shrug off worries about the economy to give their loved ones a costly send-off.

"Everybody's affected by the economy. But people die. They all go to room temperature," said Bob Hanson, who sells pre-paid funeral insurance for an Idaho company and spoke on Monday on the sidelines of a National Funeral Directors Association meeting in Orlando.

According to the association, funeral services are an $11 billion industry in the United States. And business, actuarially at least, is on track for an upswing.

The association projects the U.S. death rate will increase from eight people per thousand in 2007 to 9.3 people per thousand in 2020 and 10.9 per thousand in 2040, as baby boomers die off in growing numbers.

Underpinning future growth, spokeswoman Jessica Koth said the industry doesn't follow typical consumer spending patterns.

"People don't borrow from the 401k to buy groceries or gas," Koth said, referring to retirement savings accounts. "This is a major life event, like a wedding, so people are willing to borrow from their 401k or cash in that life insurance."

In more cases than not, funeral directors and suppliers at this week's meeting told Reuters that business is holding steady, and even growing for some niche products.

Fortress Mausoleums' cast-stone, above-ground tombs range in price from $5,000 to $15,000, but the $15,000, two-person model is the most popular and still selling well.

"Our business is booming better than ever. It's a true story," said Fortress co-owner Don Magallanes.

Andy Lopez of Affinity Caskets sells caskets for military veterans, and he said his company has kept busy meeting the needs of World War Two veterans.

"When it comes to the military service, if the family understands the legacy that is there, the pride, the sacrifice, cost is almost never an issue," Lopez said.

Traditional suppliers like Dick Stein, national sales director for Newman Bros, maker of bronze markers, urns and other grave monuments, and Larry Stuart, owner of Advanced Crematory Technology, both said business is on par with last year.

CASKETS WITH TEAM LOGO

Filling the void for branded funeral merchandise, Eternal Image last year began selling the official caskets and urns of Major League Baseball teams.

They also offer caskets and urns with the insignia of several universities, including Purdue, Texas Tech and the U.S. Military Academy at West Point. Products branded with the stamp of the Vatican library, the American Kennel Association, the Cat Fancier's Association and the Star Trek television and movie series are also on offer.