COVID: Will life cover pay out if you die from Covid-19?

Posted on 9 Jul, 20 by BrightRock

With the global pandemic continuing to raise havoc and the rising infection rate in South Africa, you may have wondered what this could mean for your insurance products, such as your life cover.

Will your insurer pay out if you pass away from corona-related causes? For this next part in our Covid-19 series, we reached out to local specialists to answer this question, and more.

Are you covered for Covid-19?

According to Ruvan J. Grobler, business development and wealth manager at Bovest Wealth Management, policy holders of the major Insurers in South Africa should have no exclusions on these types of pandemics or Covid-19 related claims.

“In short, yes, they will pay out if you die as a result of contracting the virus,” says Grobler.

“However, it’s important to remember that there are several insurers in South Africa and each of them assess claims differently. Every policy holder should consult with a reputable adviser for more information on how and when to claim, as there are certain case-by-case variables,” says Grobler.

Anton Keet, head of risk services at 1Life Insurance, agrees that, if you have natural life cover, death caused by Covid-19 would be covered on all valid claims as it would be considered a natural cause of death.

“Normal claims requirements would apply, should you pass away from a Covid-19 related death. This includes a death certificate, proof of policy, and beneficiary details,” says Keet.

Has the coronavirus increased the cost of overall premiums?

According to Deidre Wolmarans, head of service at Metropolitan, no upward adjustments to premiums have been made as a result of Covid-19, and no adjustments to premiums for new and existing clients are foreseen in the near future.

“Our products are designed to not only help clients during tough times but also to withstand extreme events, like the one we’re going through,” says Wolmarans.

For example, she explains that the Metropolitan Funeral Plan was designed to allow clients to miss up to four premiums before their policy lapses.

Wolmarans points out that the majority of Metropolitan’s products do not require extensive underwriting, such as blood tests, which makes it possible for clients to get cover. Therefore, the product range did not need to be adjusted as a result of Covid-19.

“We understand the importance of being covered, particularly during this time and have made it easy for clients to obtain cover to protect themselves as well as their loved ones,” says Wolmarans.

Contracting the coronavirus during your waiting period

According to Felix Kagura, head of life insurance propositions at Standard Bank Insurance, there are no specific terms and conditions that exclude clients from claiming as a result of Covid-19.

However, he adds that in some cases there may be exclusions emanating from the fact that other conditions of the cover haven’t been fulfilled.

“For example, some of our policies have a waiting period and if the unfortunate happens within the waiting period then the client isn’t covered,” says Kagura.

What if Covid-19 is a pre-existing condition?

According to Darryn Padayachee, chief financial officer at African Rainbow Life, when applying for life cover, you have to answer a health questionnaire that contains seven medical questions.

He explains that part of this is a declaration on pre-existing conditions.

“If it turns out that you knew you had Covid-19 at the time of taking out the cover, this would be considered a pre-exisiting condition and would not be covered,” says Padayachee.

What about critical illness cover and disability cover?

According to Schalk Malan, CEO of BrightRock, the coronavirus is not a clinical definition under any of the clinical definitions documents for the different types of cover available.

However, BrightRock’s clients can still claim under their policies if they meet the necessary criteria. Whether or not a client can claim under their policy will depend on the type of cover they’re submitting a claim for:

1. Temporary disability cover: Clients can claim under this cover if they contract the coronavirus. They might qualify for a claim if they’ve been booked off work after being diagnosed with the virus for longer than their waiting period. This means that if a client has a waiting period of one month, they need to be booked off by a doctor for longer than one month.
2. Permanent disability cover: If a client meets the criteria for a permanent expenses claim – that is if they’re permanently disabled and unable to work in their current occupation due to contracting the virus – then they’ll be able to claim under this cover. Clients can only qualify to be assessed under the occupational criteria, but they might still be entitled to a claim payment if they meet the claim criteria under one of the clinical definitions.
3. Critical illness cover: Covid-19 isn’t a clinical definition under this cover, so clients won’t be able to claim for this diagnosis under critical illness cover. If a client suffers complications due to the coronavirus, which meets one of BrightRock’s over 300 clinical definitions under its critical illness cover, they might be able to qualify for a claim.

Note that every insurer is different and it’s best to contact your service provider directly to find out about the company’s critical illness cover and disability cover.

This article first appeared on 09 July 2020 in JustMoney, written by  Isabelle Coetzee. Click here to access the article.