A settlor may sign a Trust deed with a Trust provider so as to accord with legal requirements (such as in the case of Article 44 of the Law pertaining to funeral management which stipulates that funeral service providers must place into trust 75% of the cash received in advance from a contract signed during a person’s life) or so as to upgrade the image of their product in order to gain customers’ trust. In so doing, the settlor will pay a certain amount of the fees raised in advance to the Trustee to manage and handle the Trust.

• Settlors for this type of Trust will usually be those who accept some form of upfront payment or have some membership affiliation, such as funeral homes, gyms, beauty parlors, etc.
• The Trust assets are an upfront service fee taken by the Settlor from his/her client, usually representing a substantial sum over a long period. This type of Trust has been designed to help the Settlor, before he/she has to fulfill the requirements of the contract with his/her client, to safeguard the advance payment against misuse, which could in turn lead to the company having operational or financial problems and so affect the rights of his/her client.
• In establishing a Trust in which one is also the beneficiary, only after the settlor has fulfilled his obligations towards his/her client or when there occur other factors which are specified in the trust contract (including but not limited to cancellation, conclusion or termination of the contract between the settlor and his client), and only then can the Trust assets be accessed, the Trustee stands as a third party, rigorously controlling the Trust’s cash assets, and protecting all the client’s hard-earned money.
• The Trust assets are as a matter of principle invested only in cautious or conservative investments, such as bond funds.
• Both the profit derived from handling the Trust assets, as well as the related risk, are borne by the settlor / beneficiary (one and the same party).
• The Trustee cooperates with the demands of the settlor, and regularly provides the client with dedicated e-mail access to check the balances of separate Trust account, so allowing for greater clarity of the Trust structure.

Now apart from forcing funeral operators, when selling the “Living contract”, to place into Trust the 75% upfront contract deposit that they receive from their clients, other groups such as umbilical cord blood banks, bridal salons, beauty salons, and in future even department stores issuing coupons or gifts as loyalty programs, are all suitable for using this Trust structure so as raise product awareness, raise customers’ confidence to spend, and open up new business opportunities and profit centers