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Make sure your funeral policy pays for your, and your loved ones’ funeral by taking out a funeral insurance policy with a licensed and reputable insurance company. It’s one of the best ways to avoid a funeral insurance scam, and to ensure your valid claims will be paid quickly! Here are how some funeral plan scams operate and tips to help you avoid them and protect yourself from criminals!
Red flags to watch out for
You can identify funeral cover scams by watching out for the following:
Red flag #1: Too-good-to-be-true offers
The saying – if it looks too good to be true it probably is – remains one of the best pieces of advice you can follow!
Criminals may promise you a funeral cover policy at a very cheap premium with a high sum assured, such as R30 a month for R50 000 cover. The premium is too low for the sum assured – way too low, which means it is probably a funeral insurance scam! Criminals may also lure you with promises of policies that will pay for lavish funerals in private burial parks, with a three-course plated meal for 100+ mourners plus drinks, food vouchers (now and later) and more. All for less than R100 a month. You get the idea – too good to be true! Don’t be tempted or sign anything. If you do, chances are that your premium is being paid to a criminal and there is no actual funeral policy!
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Red flag #2: Unsolicited approaches in public places
Chatting to a fellow traveller at a taxi rank who suddenly tells you how you can win big or save money? Or at the mall? Criminals often approach potential victims when they are at ease, or waiting, such as in a queue. It’s the perfect time to start a conversation with a stranger! But what is the stranger saying and offering you? Are they asking for your personal details, your banking details, wanting you to enter a competition so you can win a luxury prize – or how about filling in a survey or donating to a good cause? Criminals use these opportunities to obtain personal details, which they can use to take out funeral policies for their benefit. Another funeral cover scam will be to “sell” you a funeral policy, which is actually not a funeral policy! It is a ruse to get your banking details so that criminals can defraud you!
You want to be friendly, but your personal and bank account details need to remain private!
Red flag #3: Requests for personal and financial information
When the phone rings and the caller says they are from your insurer wanting to confirm your ID, full name, bank details, and more – you need to be careful! Unless there is a very good reason or an ongoing service issue such as a change to a funeral insurance policy, insurance companies won't ask you for all these details! Criminals will ask for your personal information and can use it to set up fake funeral policies and fake debit orders.
Red flag #4: Suspicious SMS or email verifications
Got an SMS or email saying your bank needs you to confirm a personal detail or debit order? It looks legitimate but it might not be. It could be a criminal trying to get you to panic and give out your details, which they will then use to defraud you! Or, you could be asked to verify a debit order that you have no knowledge of from a company you have never dealt with. Banks and insurance companies use DebiCheck to confirm debit orders, but only once you have completed an application form and been accepted for a policy. When SMS’ and emails arrive and you haven’t bought anything or taken out a new policy, it could be a funeral cover scam. Don’t click or verify – ignore and delete.
Red flag #5: Pressure to sign documents quickly
This is a classic financial scam! Criminals want you to panic about your financial affairs and have you believe that unless you act now, your money will be stolen, or that you will miss a once in a lifetime opportunity. Don’t panic! If there is a threat of fraud on your account, contact your bank’s fraud hotline. And if the offer is a once in a lifetime opportunity, turn it down! Very few products and services, especially financial services products such as funeral cover, work like this. This is a funeral plan scam! You can buy funeral cover at any time, and there are never any once in a lifetime opportunities. In fact, funeral insurance policies often become more innovative, flexible and relevant over time – so you definitely won’t miss out if you don’t take up the offer in the next five minutes!
Protect yourself
One of the best ways to avoid funeral insurance scams is to make sure your insurance company is licensed with the Financial Sector Conduct Authority. Licensed and reputable insurance companies such as 1Life Insurance are committed to providing transparent funeral cover policies. As a licensed insurer, 1Life Insurance pays all valid funeral cover claims quickly, and keeps in regular contact with policyholders so you know of any changes to policies. In addition, policyholders can access, at any time and from any location, details of their policies on the online policyholder services portal or WhatsApp service centre.
You can also protect yourself from funeral policy scams and your financial and personal information from criminals by:
- Reading everything, for example applications, any documents, entry forms, SMS’, emails, WhatsApps, before completing any personal information, verifying details and signing. Know what you are signing, what information you are giving out and to who. If in doubt or you don’t understand - walk away.
- Not accepting advice or product offers from strangers in public places - however good looking they may be!
- Verifying details of people who contact you – if it is your bank or your insurance company or your place of work or your best friend asking for details or confirmation of details check that it is them! Contact the person or institution directly, using the contact details on websites, not the numbers given in the SMS and find out if the person on the SMS or email is who they say they are!
- Checking your bank statements regularly to make sure no unauthorised debit orders are being deducted. Contact your bank if they are.
- Check monthly statements for store cards and credit agreements such as vehicle finance agreements to make sure you are not paying for a policy you have not agreed to.
Suspect a funeral insurance scam?
If the approach is in person, make sure you are in a safe place, and have your phone ready to make an emergency call if you need to. If you are approached online, on the phone or on social media:
- Contact the company in question on their fraud hotline, details will be available on their website
- Contact your bank to make sure your accounts are safe and no money has been deducted without your authority
- Contact the police and South African Fraud Prevention Services if your ID or personal details have been stolen
Suspicious and sceptical is smart and savvy
Be wary and be suspicious - it is the smart thing to do and will go a long way to help you avoid funeral scams! Follow the tips above and watch out for the red flags. And always remember that funeral cover sold from licensed insurance companies will come with documents, regular emails, and online access points where you can view your policy documents. And don’t be pressured into signing deals in a hurry or unnecessarily giving out personal information.