Help, my funeral claim was rejected

Your funeral policy ensures you can give your loved ones the send-off they deserve. Funeral plans pay valid funeral claims quickly, often within 24 hours. The funds can be used to pay for services such as undertakers so you don’t have to worry about how you will pay for the burial. However, if your funeral claim is rejected, or declined, the emotional stress and frustration of wondering how to pay funeral expenses can be overwhelming. In order to successfully claim on a policy, you need to understand the reasons funeral insurance claims are rejected.

Understanding funeral claims

When a member insured on a funeral policy passes away, a claim should be made to the insurance company. The insurance company will explain the funeral claims process that needs to be followed, such as completing a claim form and submitting IDs and the death certificate, as well as confirmation of bank details for the account the proceeds should be paid into. Insurers should also have these details on their websites. For valid claims, this process can be a matter of a few days, sometimes even a few hours.

Common reasons why funeral claims are rejected

Over 90% of funeral insurance claims in South Africa are paid, however, some are rejected or declined for the following reasons:

A claim is made in the waiting period

Funeral policies usually have a waiting period during which time premiums must be paid but claims cannot be made, such as a six-month waiting period for death due to natural causes. This means that only after six months has passed and six premiums paid, can a claim be made where a member passes due to natural causes such as pneumonia, cancer or heart failure.

The policy has lapsed due to non-payment of premiums

Premiums for funeral policies are due every month. If they are not paid when due cover may be suspended and the policy may lapse, or be cancelled. South African insurers have to give you a grace period in which time to make up an unpaid premium, such as 31 days. If they don’t receive the missed premium in this time the policy may lapse and no insurance claim will be paid.

The cause of death is excluded from cover

An exclusion is where a specific cause of an event, such as the cause of a death, is not covered and no claim can be made. All policies have a general exclusion for illegal or criminal activities. If a death occurred while a member was committing a crime or under the influence of drugs or alcohol, or participating in a riot, for example, no claim can be made on the funeral policy.  Death due to suicide is also usually excluded for a period of time such as six or 12 months.

An additional member does not meet the insurers definitions for an additional or extended family member

Funeral insurance policies allow for the cover of extended family members such as parents, siblings, and cousins. However, each insurer has strict definitions of who can qualify as an extended family member, such as there must be a blood relation, or members must be related by marriage. If a family member does not meet these definitions the funeral claim will be declined.

Top tip: Funeral insurance claims may be delayed if:

• There is incomplete information on the claims form: insurers need all sections to be completed
• There is missing documentation: if a death certificate is not presented a claim cannot be paid

How to avoid funeral claim rejections

By ensuring you understand your policy terms and conditions and follow the claims process you can ensure your valid claims are paid quickly!

• Read your policy terms and conditions and ask your financial adviser or insurer to explain any terms that you don’t understand, including waiting periods, exclusions and who qualifies as an additional or extended family member
• Pay premiums when they are due and make up any missed premiums in the grace period, or talk to your insurance company if you are struggling to pay premiums on time or to afford your cover
• Ensure the beneficiary knows how to claim: tell your beneficiary who and what your policy covers and explain the claims process to them
• Follow the claims procedure: you can always ask the claims team exactly what you need to do, when and how, such as how to complete and submit forms

What to do if your funeral insurance claim is rejected

Your insurance company will inform you of their claims decision in writing, and the reason for their decision. Take some time to read their decision and see if you can resolve the issue, such as submitting outstanding documents. Or you can dispute the decision.

Disputing a rejected or declined funeral insurance claim

Licensed South African insurance companies are required to follow a formal complaints resolution procedure to resolve any claim queries or disputes. Details of the process are available in policy documents and should be on the insurer’s website.

There are three basic steps to formal complaints procedures:

1. Inform your insurance company in writing that you wish to dispute the decision and why. You should send this to the complaints officer, whose details should be on their website.
2. The insurance company is required to review the decision and inform you of any new decision or changes to their original decision.
3. If you are still unhappy with the decision you can approach the National Financial Ombud Scheme. They will assess and review your case and make a final decision.

1Life Insurance is committed to changing policyholder lives for the better

1Life Insurance is a licensed insurer and financial services provider and has been changing policyholders’ lives for nearly two decades. 1Life Insurance funeral cover policies can be tailored to your needs and budget, with cover up to R50 000 each for up to 16 members. You can buy funeral cover online and save 40% on premiums, as well as access and manage your policy safely and conveniently in your own time on the online policyholder services portal and WhatsApp service centre.

1Life Insurance has been voted an iconic brand 2 years in a row, in the 2022/2023 and 2023/2024 Ask Afrika Icon Brands Awards and recognised as South Africa’s #1direct life insurer in the annual Swiss Re Reports for 11 consecutive years! Our policyholders are always top of mind, and in 2023 and 2022, we had the highest net sentiment in the PWC SA Insurance Index Report. 

Know your policy terms and conditions to avoid rejection

Funeral insurance policy claim rejections are most often due to non-payment of premiums, or the policy terms and conditions not being met. Learn more about your policy by reading your policy documents and any correspondence your insurance company sends to you. Make sure you ask questions about any terms you don’t understand. When you know your policy terms and conditions, you’ll know how to avoid a rejected or declined funeral claim and have the funds for the funeral service your loved ones deserve.