Yes, we deal with funeral trust accounts all the time and have for years and this is what we have decided to do. Sometimes the funeral trust account is opened by the "potential decedent" and sometimes it is opened by the funeral home director. Either way, getting the signed funeral trust agreement is what governs everything.
As to CIP, if the potential decedent opens the account, we CIP them and they sign the signature card. Since the funeral home is only the beneficiary of the funds, we would not CIP them until they come in to collect the funds for services provided.
Though as I stated above about the advice from our attorney on not letting the funeral home director open the funeral trust account, our bank has decided this is a low risk and allows it. If the funeral home director comes in to open the account on behalf of the potential decedent, we CIP the potential decedent and we CIP the funeral home - including Beneficial Ownership. The Ownership portion would not be completed but you would complete the Control Prong. This was verified with FinCEN.