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Your funeral cover plan ensures you and your loved ones can have a respectable funeral service, without worrying about the costs. But not all funeral policies are created equal, so you should always check that your funeral insurance is from a licensed insurer who follows Policyholder Protection Rules and complies with the Long-term Insurance Act. These regulations ensure your consumer rights are protected!
To make sure your insurer is transparent, and to ensure your valid claim will be paid quickly, your insurer must do these six things.
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1. Give you your policy documents
Your policy documents will have all the details of your funeral policy including the policy number and details of who is covered. Your documents may include a policy schedule and/or a policy book, which also explains all the terms and conditions of your funeral policy.
Although they can seem lengthy, you should read through your policy documents and make sure you understand the cover. In addition, you must check that all your personal details, and the personal details of any family members covered on your policy are correct, such as the spelling of full names, ID numbers and contact cell numbers, as well as their relationship to you, the main member.
Insurers licensed with the Financial Sector Conduct Authority in South Africa are required to have policy documents in plain language, so they should be easy to understand and have any insurance terms defined. Insurers’ websites should also have a glossary explaining all the insurance terms, so make sure to look for these. But, if there is something you cannot understand, ask your insurer or financial adviser for an explanation.
You should receive your policy documents via email within a few days of your policy being accepted. If not, contact your insurer or financial adviser and ask for your documents.
2. Explains what your policy covers
Each member insured on your funeral policy, including yourself as the main member, and any additional members such as your spouse, will have their own sum assured. You can find these amounts on your funeral policy documents. Your policy should clearly state if these amounts are to be paid in cash for a valid claim, or if they are to be paid to a service provider such as a particular funeral parlour.
In addition, your policy may have benefits such as a grocery benefit or a memorial benefit. You need to make a note of these amounts and who qualifies for them, and when, so you and your loved ones can claim in good time.
Top tip: Check at least once a year that the sums assured are enough to cover the costs of a funeral, as you may want to increase the cover amounts as the costs of funerals increase.
3. Clearly state your premium information
Your premium is the amount you pay for your cover and needs to be paid monthly. Your insurer must tell you how much this is, when it is due, and if it can increase at any time in the future. Your insurer should give you at least 31 days' notice of any increase in premiums, in writing.
Ideally, you should insist on paying premiums via a DebiCheck debit order to ensure your premium is paid to the correct insurer. DebiCheck debit orders have been validated with both the payer and the receiver of the debit order, which gives consumers protection against an unauthorised party taking money out of your bank account.
4. List and explain any waiting periods and terms and conditions
Waiting periods are the time during which premiums must be paid but claims cannot be made. These may apply to the cause of death, such as death from natural causes – for example cancer, and/or death due to suicide. These need to be clearly explained on your policy document so you know exactly what you and your family members are covered for and when.
In addition, your policy will have certain terms and conditions such as excluding claims due to illegal activities, which you must read and understand. These should not be too lengthy, and if you feel there are too many exclusions or too long waiting periods, or that the terms on your policy are not transparent, check with your insurer to make sure you actually will have cover when you need it!
5. Share details on how to claim
The reason you take funeral cover is to have a valid claim paid quickly so you or your loved ones can pay for the funeral costs. Insurers can pay valid claims quickly, often within 24 business hours of receiving all the documentation, such as a death notice.
Make sure you have the contact details for the claims department and read their claims process, sharing it with your beneficiary, so you can claim quickly and easily. Also, make sure your insurer has detailed their claims process on their website, when claims are paid and what would be reasons for a claim to be reduced or declined, and how and where to complain if you are not satisfied with the process or claim pay-out. This will include details of the Ombudsman for Long Term Insurance, who will act as an independent adjudicator in any dispute with an insurer and ensure consumers are protected.
You can read more about how to claim with 1Life Insurance in this blog.
6. Give you their contact details and make it easy to manage your policy
Your insurer should keep in regular contact with you, sharing newsletters, important policy information and details on any changes in their organisation. They should offer ways to contact them telephonically and online, and offer self-service options so you can view your policy details and update information such as bank account details and beneficiary details online.
Licensed insurers are required to contact their policyholders at least once a year, to make sure you are still happy with your funeral policy and that it meets your needs.
1Life Insurance changes lives
1Life Insurance offers tailor-made funeral cover policies that can cover up to 16 family members. Valid claims are paid quickly, ensuring the costs of a respectable funeral can be paid. 1Life Insurance is a licensed financial services provider and has been voted SA’s #1 Direct Life Insurer for 11 years in a row. You can get a quote and buy policies online, and manage your policy using 1Life’s online policyholder portal or WhatsApp service centre.
Registered insurers give consumers protection
Registered insurers offer insurance policies that are easy to take out, understand and claim on. The terms and conditions of your policy must be transparent so that you know what you are covered for and when. If your insurer is transparent and is sharing all the information you need, and is licenced as a financial services provider, you can be sure they will pay valid claims and that your loved ones have the cover you need and can pay for a respectable funeral.
The information contained in this article was correct at date of publication