What to do with your insurance and investment policies

If you are unable to meet your monthly commitments, call your provider rather than letting your investments or policies lapse
If you are unable to meet your monthly commitments, call your provider rather than letting your investments or policies lapse

ASK FOR A PREMIUM HOLIDAY ON INVESTMENTS

If you have contractual agreements for investments such as retirement annuities or endowment policies, speak to your financial adviser or service provider for a premium holiday.

If you urgently need to break a fixed deposit, find out if your bank will waive penalty fees.

Old Mutual says that for its core range of savings policies, it now has a measure that allows customers to skip up to two premiums before a policy is treated as off the books. Customers can still restart their premiums within 12 months and choose to repay premiums or not.

Old Mutual is allowing employers to reduce or put retirement fund contributions on hold for three months. These options apply to employer and member contributions.

Nedbank says that for clients requiring an early release on their investment funds, it will waive the penalty fee for up to the value of R200 000 at an overall portfolio level. This offer applies over the next three months, between March 24 and June 30. This would apply to fixed-notice investment accounts.

NEGOTIATE WITH YOUR SHORT-TERM INSURER

Many short-term insurers have already indicated that if customers are in genuine financial difficulty, they can contact them and arrangements can be made. Some insurers have already taken steps to reduce the pain for customers.

MiWay has automatically dropped premiums by 10% for the month of April. MiWay CEO Rene Otto says: “When clients work from home, they drive less. This reduces the risk of them being involved in an accident. At MiWay, we believe the right thing to do is to reduce their premiums, given the reduction in risk.”

Naked is an app-based insurance product that allows you to switch off cover as and when you need to. If you are not driving your car during lockdown, the cover can be paused and your premium halved. You are covered for theft and Mother Nature, and any other non-driving-related accidents.

According to Robyn Farrell, CEO of Non-Life at Telesure Investment Holdings, the holding company of insurance brands including Budget, Dialdirect, Auto & General, and 1st for Women, “we are here to help them with maximum flexibility. If our customers require assistance, we ask that they contact us via our online channels and we will be in touch to discuss how we can support them.”

KEEP LIFE COVER IN PLACE

This is definitely not the time to cancel cover, especially given the heightened risk of becoming seriously ill. Speak to your adviser or provider about your various options.

When it comes to claiming from policies, cover only protects you if you get infected with the Covid-19 coronavirus – it does not provide cover for loss of income because of the lockdown. Financial adviser Markus Bauriedl of LifeForce Financial Services says there are no exclusions for Covid-19 and if a person passes away from the virus, they will be covered. If they contract the virus and are unable to work, they can claim from temporary income protection if they are booked off for longer than their waiting period.

Bauriedl says many of his clients have contacted him as they are self-employed and have lost income as a result of the lockdown, and are worried about being unable to make their premiums.

There is the option to restructure cover rather than cancel it.

“For protection policies, we are encouraging our customers as far as possible to maintain premium payments and keep cover at the full level, but there are a variety of relief options – including reducing cover, removing accelerator benefits and changing from annual to monthly premium payments – depending on each person’s unique circumstances,” says Old Mutual.

Insurer BrightRock is actively developing a “toolbox” of potential solutions that it will make available to clients, depending on their individual needs and situation. Advisers will be able to use these options (for example, restructuring a client’s cover, which can be sustained for longer) and work with the BrightRock team to find solutions.

“One such example is ‘special leave’, where a small business owner or a self-employed person can keep their full cover in place, even if they are not working for a period,” says BrightRock CEO Schalk Malan.

“The fact that they have temporarily lost an income does not mean they have to lose their protection.

“If the current situation causes a client to change their occupation, they are also able to keep their full cover, and they do not need to notify BrightRock of this change.”

Insurer PPS says its members are fully covered through its Sickness and Permanent Incapacity Benefit policy should they be diagnosed with Covid-19 and be unable to work for a time. This cover is in place even if they are not suffering symptoms.

“Members do not have to have a positive Covid-19 test result to submit a valid claim to PPS,” says the insurer. “They do, however, need to be classified as a ‘person under investigation’, as defined by the National Institute for Communicable Diseases, to submit a sickness benefit claim.”


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