What is a requirement for trust money from prearrangement contracts?

The correct answer emphasizes that trust money from prearrangement contracts must be deposited in a commercial bank. This requirement is crucial to ensure that the funds are held in a secure and regulated environment. By depositing trust money in a commercial bank, it provides a level of protection for consumers, as banks are subject to strict regulations that oversee their handling of funds.

This process assures that the money is managed properly and is available when needed for fulfilling the terms of the prearrangement contracts upon the death of the individual. Additionally, it safeguards the money from potential mismanagement or misuse by ensuring that it is not intermixed with the funeral provider's operational funds. Maintaining trust funds in a regulated banking environment helps to give peace of mind to consumers that their prearranged funeral services will be honored and funded correctly when the time comes.