It’s a good time of year to update your insurance

2010-10-30 10:19

It is that time of the year again when insurance ­companies go full-throttle in their marketing efforts.

It is also a very good time for consumers to get cheaper rates, as well as medical-free underwriting.

Clients are given an opportunity to review their risk-cover policies and update their information.

I often come across people who took out policies ages ago but have neglected to update their personal information such as a change in occupation, income, marital status or even the addition of dependants.

Some may have undergone a divorce or remarried, but have not ­updated their beneficiaries.

Now is the time to set aside a ­moment to do a full update because these things have financial ­consequences that could lead to all sorts of ­problems.

Recently I had to explain why a ­disability claim was not paid to the family of a man who was now in a wheelchair.

This man took out a life policy 18 years ago and paid all his premiums without fail. He worked as a clerk when he took out the policy but improved his education, which saw his monthly income rise over the years, from R800 to R42?000.

The mistake he made was not to review the policy, and, according to him, he simply did not make time to do this.

He said he was very comfortable with what the ­company provided through its group scheme.

Unfortunately, the man was covered for total ­disability and not occupational disability.

Total disability was often given to unskilled ­labourers because they did not have specific duties.

The man’s qualification meant he was multi-skilled. And in fact he could still get work and ­perform his duties as a manager.

It was for this reason that his total disability cover would not pay out.

There are many more individuals out there who have similar cover.

This week I received a call from a bank call-centre consultant who ­wanted to sell me accidental death cover.

What people are not told is that the death has to occur within two weeks after the accident. With today’s medical innovations, some people survive past the two weeks before they die.

The key thing is to take advantage of the specials, find out what they cover and make sure you are ­adequately insured.
Insuring yourself while you are still young can help you get cheaper rates because your risk profile is better.

Diale is a financial planner. He can be ­contacted on 078 775 0802

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