What is required from funeral establishments regarding prearrangement contracts and trusts?

Funeral establishments are allowed to enter into a "master trust" arrangement with other licensed establishments as part of handling prearrangement contracts. This means that instead of managing individual trusts, funeral homes can collectively pool resources into a larger, shared trust, which can streamline operations and financial management.

Master trusts also provide a way to diversify risk and potentially offer better financial returns for the funds set aside for prearranged funeral services. This aligns with the regulations in Washington, promoting accountability and better financial practices among funeral providers while ensuring consumers' prearrangement funds are properly safeguarded.

The other options either suggest overly restrictive practices or misunderstand the flexibility allowed under state law regarding trust arrangements. Thus, the ability to create and participate in a master trust reflects a regulatory framework that facilitates cooperation among licensed funeral establishments while ensuring the proper management of prearrangement contracts.