In times of trauma or grief, you and your loved ones should not have to deal with the stress of having a life policy payment rejected or delayed.
In times of trauma or grief, you and your loved ones should not have to deal with the stress of being denied disability benefits or having a life policy payment rejected or delayed. “Ensuring that you are paid when you call on life or disability cover requires a little more than just paying a monthly premium” advises Selwyn Kahlberg, Managing Director, Alexander Forbes Life Limited. For cover to remain valid, policyholders need to comply with all requirements in the policy. While this should not be a difficult task, Kahlberg urges consumers to be aware of the following pitfalls when taking out or maintaining a life and disability policy: 1. Failing to disclosure all relevant information on your application Deliberately withholding or giving misleading information to your insurer is a direct violation of your policy agreement. This can result in all claims being rejected. Policy holders should fully disclose any previous medical conditions when applying for life and disability cover. If, for example, you have suffered a heart attack and it re-occurs, your insurer may refuse to settle your claim if you did not inform them of the first attack. 2. Taking out insufficient cover Life cover is meant to provide financial security for your family when you die. Similarly, disability cover needs to ensure that you and your dependents are able to maintain your lifestyle should you not be able to perform your current job. As such, “it is important to draw up a budget reflecting your family’s daily needs and expenses when deciding on the level of cover required” advises Kahlberg. It is also important to continue to revisit your insurance requirements as circumstances change. At the very least you should take account of inflation to ensure that your benefits do not lose their purchasing power over time. 3. Not informing your insurer that you have changed jobs Changed employment terms can affect the cost and level of your cover. For example, if you were an office clerk and get a new job as a fire fighter, your risk level would increase substantially and your insurer would need to review your policy. 4. Failing to inform loved ones of your cover or whereabouts of documentation If you do not inform your loved ones about your life or disability cover, there is a possibility that they may never claim when the need arises. As such, it is “advisable to keep the policy in a safe place, telling loved ones where the policy is and who they should call in the event that it is needed” advises Kahlberg. 5. Failing to inform insurers of a claim within the required time Almost all policies require that claims are notified to the insurer within a specified time where after the claim can be declined. This is one of the most common reasons for claims not being paid. Dependants may forfeit their benefits if they delay telling the insurer about a claim or do not supply the required documents to the insurer within the times specified. 6. Not keeping the nominated beneficiaries up to date Always ensure that you let the insurer know about changes to the nominated beneficiaries on all your policies. Once a claim arises, the insurer will always pay according to what you last instructed them. For example, if you have had another child and want a specific amount set aside for it you will need to change the beneficiary forms held by the insurer. 7. Not providing full information when making a claim Always insure that the insurer is given as much accurate information and documentation as possible. This is especially the case on disability claims. Incomplete or conflicting information will cause delays in getting a claim paid. For example, “if you forget to provide your insurer with your dependents’ ID numbers, or supply incorrect or different numbers” warns Kahlberg. 8. Not disclosing that you have taken on additional risk, like smoking or engaging in dangerous activities Insurers charge higher premiums for individuals that smoke or are at higher risk of getting ill or dying.“If you sign on as a non-smoker and then start smoking and develop lung cancer, your insurer is within their rights to reduce your benefits or maybe even repudiate your claim” warns Kahlberg. Similarly, if you are disabled in a once-off parachute jump you will not qualify for disability cover if you have not listed this as one of your pastimes which the insurer has accept 9. Not familiarising yourself with the circumstances under which your policy will not pay There are times when a policy will not pay out even if you have made full disclosure to the insurer. “These circumstances should be clearly set out in your policy under the exclusions heading and you should take the time to understand these exclusions before signing up” recommends Kahlberg. Typical exclusions relate to alcohol consumption, drug usage, suicide and violation of the laws of the land. 10. Allowing your insurer to repudiate your claim without good reason Consumers should not sit back and allow insurers to repudiate claims except for valid and legal reasons. If you believe you have a strong case, yet your insurer refuses to settle, Kahlberg recommends that consumers take the matter to the insurance ombudsman. The ombudsman acts as a mediator to settle disputes between insurers and their clients and is an inexpensive alternative to litigation. Getting all this right is important as the onus falls on the insured to make sure that they understand all terms and conditions that they have been told about by the insurer when taking out a life and disability cover. The first step is to read all the documentation they receive from the insurer. “If you are unsure of any clause during the application process or anything in the policy wording once you receive the policy document you should ask your insurer to explain” concludes Kahlberg. Written by: Selwyn Kahlburg Source: Health24
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There are different types of assurance products that cover you if you become disabled. You need to know the differences in order to make an informed choice and buy the best cover suited to your circumstances. Hollard Life’s head of product and technical business, Ryan Chegwidden, says: “There’s no question that it makes sense to take cover against the risk of being unable to provide financially for ourselves and our families. But, thanks to insurance jargon, there’s confusion about the benefits between disability policies and impairment policies.” Chegwidden says insurers define a “disability” as an injury or illness that results in you being unable to earn an income from doing your job. An “impairment” is an injury or illness that results in a physical or functional disorder – your job is irrelevant. “Both can be equally serious and life-changing, and the effects may be either temporary or permanent, but the difference lies in the extent to which they compromise your ability to perform your workplace responsibilities. “Say a computer programmer loses his sight because of an accident or illness. His condition will prevent him from doing his job, and he will be unable to earn an income as a computer programmer, so that would meet the criteria for a ‘disability’. The loss of sight would also meet the criteria for an ‘impairment’. “However, if the same programmer loses the use of his leg because of, say, a car accident, although the injury is profound, he would still be able to do his job, because no physical agility is required to sit in front of a computer. So, in that case, while the programmer would be ‘impaired’ by his injury, his capacity to continue to earn an income from his existing job means that this would not be classified as a ‘disability’.” On the other hand, he says, if the programmer suffered from a mental condition, it is possible that this would not meet the criteria for an “impairment”, but it could be considered a “disability”. You may want a comprehensive product that covers both disability and impairment, Chegwidden says. However, you may not be able to afford the premiums. Furthermore, a pre-existing health condition or a dangerous occupation may disqualify you from disability cover. This is where impairment cover – which is not based on occupation and a pre-existing health condition may be an acceptable risk – may be sufficient. “Based on these two core offerings, there are income protection products for every circumstance,” Chegwidden says. “It’s a question of finding the one that meets your unique requirements.” Request for a quote for your disability or impairment cover, please contact Kevin or Thato in our Life Department, life@daberistic.com email tel (011)658-1333 Source: Personal Finance Disability cover protects you and your family if you are unable to do your job or you can no longer do normal day-to-day functions such as bathing, dressing or eating. With Old Mutual Greenlight Earning Ability cover you can choose between a lump sum or income benefit. Your income is the cornerstone of maintaining your standard of living. It is used to pay for everyday expenses such as food, clothing, electricity and bond repayments. Greenlight’s income benefits pay you a monthly income if you are temporarily or permanently disabled. The lump sum benefits pay out a once-off amount if you become permanently disabled. The funds can be used to cover immediate lifestyle adjustment costs such as making adjustments to your home and vehicle. Any excess funds can be reinvested to provide you and your family with an income. Disability income cover Disability Income Cover pays you a monthly income if you cannot work because of a temporary or permanent illness or injury. This can help replace any lost income, even if it is only for a couple of days or longer. Disability lump sum cover Disability Lump Sum Cover pays you a lump sum if you cannot work because of a permanent illness or injury. This can be used to pay for once-off disability related expenses and the remaining funds can be reinvested to provide you with a monthly income. Request for a quote for your disability cover, please contact Kevin or Thato in our Life Department, email life@daberistic.com, tel (011)658-1333 Source: Old Mutual |
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January 2025
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