As interest rates go up and electricity tariffs continue to increase, we are looking for ways to reduce our monthly expenses. It is better to look for cheaper policy rates than to let your policies lapse. One of the ways we continue to help our customers to manage their budgets is to do a comparative analysis of their existing life cover and funeral covers. When someone has a stand-alone funeral policy, we are almost always able to assist them to get cheaper rates. Stand – alone funeral policies are generally more expensive because there is no underwriting with funeral policies so insurance companies assume the worst. As an example, you can cover someone who is lying sick in a hospital bed and for as long as they survive for at least 6 months, then you will still get the funeral benefit pay out when they pass on.
 
What is underwriting?
Underwriting is when you insurance companies try to rate the level of risk that they are taking by giving you an insurance policy. So they will ask you several questions for an example;

  • They will ask you questions about your health e.g. do you have any existing disease, do you have chronic disease, etc…
  • They will ask questions about your lifestyle e.g. do you smoke? Smoking causes cancer so if you smoke you will be charged more for your life cover
  • They will ask you about your weight, etc…

The other common problem we find is that some insurance companies cover your children up to the age of 21. When they turn 22, the funeral policy automatically comes to an end. The reality is some people are not aware of this automatic lapse and they might have forgotten about it. It is better to take funeral cover for your children that does not lapse, regardless of their age. Many young adults are still studying or unemployed at the age of 21. So if you want to check if you could pay less for your life cover policy and funeral policy, email us at info@thuthuka-sa.co.za