By Buziwe Nocuze
- Many policyholders are cancelling insurance because rising interest rates and living costs make monthly premiums too expensive to afford.
- Funeral parlours are attracting clients with lower prices, flexible rules and clearer benefits after complaints about age limits and hidden costs.
High interest rates and rising living costs are forcing many people to stop paying their insurance premiums.
Nomsa Zweni is one of them. She had a policy that started at R300 a month. But the amount went up every year. She could no longer afford it.
Zweni says she depends on a child support grant. When the premium kept increasing, she decided to cancel her policy and look for a cheaper option.
“My policy in that company lapsed because I did not know it would increase every month and I depend on my children grant money,” she said.
She has now joined a funeral parlour in her community. She pays R150 a month for cover for seven family members.
Zweni says the plan pays out R25,000 if she dies and R15,000 if any of the other members die. She also likes that she can replace a member if someone dies. The waiting period is three months.
She says her previous insurer did not allow more than one person to register the same family member. But her new funeral parlour allows it.
Siphamandla Gocini, who works at a funeral parlour, says many people are switching because of strict rules at big insurance companies.
He says some clients only discover age limits when they try to claim.
“Some people will come and say they have been paying for members over 85 years. When those members died they were told they cannot claim because of age,” he said.
Gocini also says some people misunderstand what their policies cover. They expect a full payout, but costs like transport and paperwork are taken from that money.
In contrast, he says their funeral parlour covers all services if a client pays a fixed monthly fee.
Across the country, policies are lapsing because people cannot keep up with payments. High inflation, unemployment and rising premiums are making it harder to stay insured.
Pictured above: A gravesite.
Image source: File
