What is Life Cover and do I need a separate funeral insurance policy?
Funeral cover and life cover are two of the most popular forms of long-term insurance that South Africans have, and although most people are under-insured, we are moving in the right direction, with more and more people – like you – either considering buying a policy or seeking to upgrade existing policies. Whatever the case, you will need to know however, what the difference between life cover and funeral cover is in order to make the right purchasing decision.
What is Life Insurance?
- Life cover products are really a bundle of separate long-term insurance types, for example, a life cover policy can consist of a disability insurance policy, income protection policy, savings policy, and will definitely include a funeral insurance portion, so you do not have to take out separate funeral cover if you have life insurance.
- Life policies can either be whole or term, which means that you can be covered for the entire duration of your life, or for a set number of years, after which the term policy would expire. Read more about term life insurance here.
- These policies are usually more costly than simple funeral insurance policies, however, life cover policies offer much more for a small increase in what you would pay for a funeral policy.
- The lump sum you or your beneficiaries get from the policy is not taxable, hence many people often use life cover policies as investments.
- There has been a growing trend in South Africa for these policies to come with cash back plans, where you can receive your premiums back in cash after a least 10 years. Adjusted for inflation, this option can also be viewed from the perspective of an investment.
Because of the above and our commitment to educate you, and raise financial inclusion of fellow South Africans, LifeCoverSouthAfrica.co.za can help you get the best premiums on different life cover policies – all you have to do is to fill in the easy form below for obligation free quotes.
What is Funeral Insurance?
- A funeral insurance policy relates to yours or a family member's passing away and the subsequent expenses associated with the burial.
- Monthly premiums for funeral insurance are usually very low and can start from as little as 50 cents per day depending on the level of cover you require, ie the lump sum payout you or your beneficiaries will receive.
- Most funeral insurance products in South Africa do not have cash back bonuses where you would receive all or a portion of your premiums back if you do not claim for any death under your policy.
- Funeral insurance products are structured differently, where for example you can have funeral insurance specifically for individuals, persons with extended families, and group funeral insurance for burial societies for example.
- Funeral cover products are predominantly marketed to lower income earners, and as cheaper alternatives to life cover.
Our website only offers comparisons for life insurance quotes, so do compare today and save on your life cover premiums.