MONEY CLINIC | I'm working remotely and want to travel. How can I ensure adequate risk cover?

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With a paradigm shift towards working remotely, many South Africans are looking for ways to do this while travelling the globe.
With a paradigm shift towards working remotely, many South Africans are looking for ways to do this while travelling the globe.
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Are you planning to emigrate but unsure whether your current life or disability policy includes risk insurance for unexpected expenses abroad?

Karin Vorster, financial advisor at Africorp Advisory, lists six points to consider when reviewing your savings, or diversifying your investment portfolio, to ensure you have risk cover when travelling internationally.

1. Exchange rate certainty

Given that the exchange rate often holds South Africans at a disadvantage, you are more at risk outside of your home country. To avoid this potential pothole, obtain clarity about the effect that exchange rates could have on your monthly premiums or your benefit payouts in the event of an incident. If possible, get a plan that will offer protection against fluctuations in the exchange rate.

2. Annual billing

Paying a year’s premiums up-front can massively free up your finances and help you with your annual planning and budgeting, especially if you are relocating elsewhere. If misfortune strikes while you are abroad, or your finances get tied up in overseas dealings, you will have the comfort of knowing that your cover has been paid in advance.

3. Global education

Most life cover options provide for an education support package at an additional cost. With the option of global risk cover, it only stands to reason that there will be global education cover as well. Accommodating for education in a foreign currency can overcome an unnecessary burden for your loved ones.

4. Cover before leaving

For the sake of convenience and fluidity, hunt around for a global risk cover provider that offers protection while you are still resident in SA. This will save you loads of time during the planning and relocation process. It also offers you some reassurance that your cover is active prior to moving out of the country.

5. Estate costs

Because of excessive taxation on estates, you need to ask your advisor about the finer details around your policies in the event of death. Contrary to local life cover, there are global risk plans that will pay out to beneficiaries residing offshore, which means that it will not be deemed as an asset in the deceased’s estate and is therefore not subject to taxation in South Africa.

6. Business assurance

If you are an entrepreneur and hope to expand your footprint globally, then it is imperative to look for a type of cover that can be owned by offshore trusts and companies, which will complement business assurance structures. In the instance of key-person insurance, the premiums can then be attributed towards business expenses, and, in the event of death or injury, be made payable to the company in its designated currency.

The terms and types of cover mentioned here might vary depending on the financial institution you choose and the different packages they offer.

Whether you are an expatriate hoping to make your shift more permanent, or you are exploring your options, it is now a good time to investigate and prepare for global risk protection.

An advisor who is well-versed in the intricacies brought on by international exposure can assist with an offshore risk assessment and provide suitable protection based on your needs.

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