Life insuranceA life insurance policy provides you and your family with comprehensive cover for a range of life-changing events. A good life insurance policy from a reputable life insurance company offers you flexible financial protection at a cost- effective premium to suit your needs.
This page has the following sections: 1. Benefits available in a life insurance policy 2. Real life examples of how clients have benefited from life insurance 3. Who should consider a life policy 4. General terms and conditions of life insurance
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Discovery explains how life insurance works in the video below.
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How our clients have benefited from a life insurance policy
Kevin Yeh, Financial Adviser and Director of Daberistic Financial Services: |
Client W: |
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Client L:
"My husband died of cancer in September 2014. Daberistic Financial Services helped me claim from Discovery Life. Discovery paid out more than one million rand. This money has helped me invest in a business that generates income for me and my two children. Client L: "My brother was diagnosed with cancer in July 2014. He underwent an operation, eventually succumbed to the illness. Daberistic Financial Services helped me claim from Momentum Life. Momentum paid out R800,000. I used the money to help my sister-in-law and her children's education." |
Further information on life insurance policy
Tax consideration |
Your life insurance premiums are not tax deductible. In the event of a claim, the money you receive is tax free.
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Transfer of wealth |
You may nominate one or more beneficiaries on your life insurance policy. In the event of your death, the sum assured is paid out to your beneficiaries. Your beneficiaries do not have to wait for the process of winding up your estate in order to get the money.
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Funeral benefit |
Life cover typically includes an upfront benefit, in an effort to support your nominated beneficiaries with funeral arrangements in the event of your death, With this benefit, R50,000 will be paid within 48 hours of submitting a valid death certificate.
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Regulatory protection |
Life insurance companies in South Africa are regulated by the Financial Services Board. South Africa enjoys excellent financial services regulations and supervision, giving you the confidence that a life insurance company will pay according to the insurance contract you have signed up.
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Medical underwriting |
Underwriting is the process used by a life insurance company to assess your risk factors. When you apply for a life insurance policy, the life insurance company will do medical tests on you. If you are not healthy, the life insurance company may increase the premium it will charge you, decline certain benefits, or decline your application.
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General exclusion |
While all reputable life insurance companies in South Africa will honour life policies and pay death claims, life insurance companies will not pay death claims due to suicide within 24 months of inception of a life insurance policy. Some life insurance companies will recognise prior insurance in determining the 2 year period.
More info on general exclusions: Exclusion grid summary 2014 (courtesy Wealth Associates) Exclusion grid 2007 (courtesy National Financial Partners) |
Who should consider investing in a life policy?
You should invest in a life policy if:
- You have financial dependants, people that are financially dependant on you. For example, you have your family to look after.
- You have financial obligations, such as a home loan, vehicle finance, personal loan.
- You want to insure your ability to earn an income. This is where a disability benefit will help you financially when you become disabled and unable to work.
- You want to have money to help you when you suffer a severe illness, such as cancer.
- you want to insure the breadwinner of a household, so that in the event of his untimely death, you will have money to help your family financially.
- You and your business partners are in business together, you want to insure each other's life to ensure the continuity of the business in the event of death or disability of one of you.
- You want to insure a key person in your business, a person that has a significant impact on your business. In the event of death of disability of this key person, your business will receive money to compensate for the loss of income and expenses for finding a replacement.
- You have financial dependants, people that are financially dependant on you. For example, you have your family to look after.
- You have financial obligations, such as a home loan, vehicle finance, personal loan.
- You want to insure your ability to earn an income. This is where a disability benefit will help you financially when you become disabled and unable to work.
- You want to have money to help you when you suffer a severe illness, such as cancer.
- you want to insure the breadwinner of a household, so that in the event of his untimely death, you will have money to help your family financially.
- You and your business partners are in business together, you want to insure each other's life to ensure the continuity of the business in the event of death or disability of one of you.
- You want to insure a key person in your business, a person that has a significant impact on your business. In the event of death of disability of this key person, your business will receive money to compensate for the loss of income and expenses for finding a replacement.
How much life cover should I have?You should consider:
- How much money you currently have - The amount of income your dependants will need if you can't provide for them anymore - If you are married, how much your spouse will need - The outstanding loan amounts you need to settle - Your future needs. We provide a life and disability cover calculation template on the right, for you to view and print out to use. |
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What is the minimum premium?
The minimum premium is R200 per month. So a life insurance policy is affordable.
What if I don't pay my premium?
If you miss a premium payment, the life insurance company will try to debit your account again later in the month, or debit this month and next month's premiums next month. If you miss the premium payment again next month, the life insurance company will debit 3 months' premiums the following month. If the debit order is again unsuccessful, the life insurance company will have no choice but to terminate your policy.
After your policy is terminated, for a limited period of time, the life insurance company will allow you to reinstate your policy if you manually pay all the outstanding premiums into the insurance company's bank account, provide the proof of payment and complete a satisfactory declaration of health form.
After your policy is terminated, for a limited period of time, the life insurance company will allow you to reinstate your policy if you manually pay all the outstanding premiums into the insurance company's bank account, provide the proof of payment and complete a satisfactory declaration of health form.
Our product providers
As an independent financial planning practice, we have contracts with the following product providers in order to offer you a product that suits your needs:
Discovery, Hollard, Liberty, Momentum, Old Mutual, Sanlam, Brightrock, PPS
Discovery, Hollard, Liberty, Momentum, Old Mutual, Sanlam, Brightrock, PPS
Our preferred providers
We have done the necessary due diligence in selecting the following preferred providers:
Discovery
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We select Discovery Life as our preferred provider for the following reasons:
1. Reputable financial services group 2. Financially sound 3. Innovative product features 4. AccessCover offers client the opportunity to convert part of life cover to cash in times of suffering a severe illness 5. Integration benefits lead to reduced premiums 6. Unique Health Plan Protector with health premium refund 7. Option to receive global treatment benefit on Severe Illness Benefit claim 8. Comprehensive disability benefits 9. Immediate upgrade to 100% of your pre-disability income if you become permanently disabled 10. Payback benefits giving up to 60% of life insurance premiums back to client annually for first 10 years; 11. Clever use of technology to provide excellent client service; 12. Clients able to make premiums paid up at age 65, as part of retirement planning; 13. Cash conversion provides a lump sum tax free at age 65 at low additional premiums; 14. Class leading travelling nurse service More info: Discovery Life Overview Brochure |
Old Mutual
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We select Old Mutual as our preferred provider for the following reasons:
1. Reputable global financial services group 2. Financially sound 3. Easy to understand product design 4. 100% payout on core dread disease conditions 5. Easy to add a savings component with minimal amount (R100), giving client cash values 6. Easy electronic application process More info: Old Mutual Greenlight Brochure |