Capitec Bank [JSE:CPI] is stretching its tent further with a new insurance offering with a funeral product.
According to a statement issued by the bank on Monday, Capitec is launching the Capitec Funeral Plan, underwritten by Centriq Life Insurance Company Limited.
The product is positioned to be an affordable and flexible insurance product for the South African market.
Capitec Insure will allow for “paperless” applications and punts that claims could be paid out within four hours, and that up to 22 lives can be covered on one policy.
Funeral cover ranges from R10 000 to R100 000.
In an emailed response to questions, Francois Viviers, marketing and communications executive at the bank, said Capitec decided to enter the insurance market as a large number of its existing clients already have funeral cover from other service providers.
“We believe there is a lot of opportunity to offer them a simpler, more transparent and affordable solution that they can manage as part of their daily banking.
“We have been working on this solution for over a year in partnership with Sanlam,” he said.
Capitec plans to target new and existing clients, Viviers confirmed.
Asked if the insurance offering will be expanded beyond the funeral plan, Viviers said Capitec Insure will be focusing on the funeral plan to ensure its success before considering further insurance solutions.
How it works
Those on the Capitec Funeral Plan can personalise their cover to suit their individual needs on the Capitec Bank app.
“Existing Capitec clients can activate the funeral plan in a branch or on their banking app with no paperwork required,” the statement read.
Policies start from R25 per month through the Capitec app and R40 per month when applying in a branch, the bank explained.
“All policies feature no automatic annual premium increases provided the cover stays the same.”
There is also no waiting period for a client to switch from a different insurer to Capitec Insure. “In other words, if there is a natural death within the first six months of a policy, the waiting period will be waived for the same lives and cover amounts as the cancelled policy.”
Capitec has been rated the best bank in the world by Lafferty Group’s 2017 Global Bank Quality Benchmarking study, which ranks 100 major banks across 32 countries.
Capitec was awarded Lafferty Group's highest 5-star rating, Fin24 previously reported. The bank is known for providing affordable services and unsecured loans.
However, earlier this year US-based short-seller Viceroy claimed in a report that Capitec is a “loan shark”. The bank vehemently defended itself against the allegations. The Viceroy report had no impact on Capitec’s annual results.
The bank instead reported a 18% jump in headline earnings from R3.8bn in 2017 to R4.5bn. Capitec boosted its net income by 17% in the year ended February 28 2018, and a dividend of 1 470 cents per share was declared.
Capitec Bank on Monday was named South Africa’s “strongest brand” according to the Brand Finance Top-50 brands in terms of marketing investment, familiarity, loyalty, staff satisfaction and corporate reputation, Business Insider reported.
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