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Does my insurance policy cover me for coronavirus?

01 April 2020 Stangen

If you contract the coronavirus, you and your family will automatically by covered by your existing life, funeral and income protection insurance policies: there’s no need to procure additional life policies.

In fact, your biggest risk as a healthy person from the coronavirus is a potential loss of income if you have to be isolated or are unable to work, says Marius Botha, managing director of life insurer Stangen. If contracting the virus results in a temporary disability, and you have used all your sick leave, income protection products would pay out where applicable.

The coronavirus is something the industry cannot ignore, but the role of an insurer is to manage risk – and epidemic and pandemic risks like Covid-19 are generally planned for by life insurers in the normal course of events, says Botha.

“The coronavirus will not affect the policies of existing customers in any way. If you die or become disabled after acquiring the virus, you will be covered (provided all other terms and conditions are met). New customers, however, will have to disclose if they have the virus, or think they might have it, so we can apply the necessary medical underwriting rules,” said Botha. “The customer’s responsibility is simply to be honest in all their disclosures.”

There are three main insurance products that could be affected by coronavirus-related claims:
1. Life insurance: In the case of life cover, your policy will pay out if you pass away as a result of the coronavirus.
2. Funeral cover: Funeral cover will also pay out, provided you have served the waiting period on the policy for a claim to occur - for example, the first six months for main members, or 12 months for extended family members
3. Salary protection: With group income disability or salary protection policies, it’s important to check the exact terms of your policy. Generally speaking, though, if you get the virus and it results in you no longer being able to perform your occupation, then you will most likely have a valid claim, assuming all sick leave has been utilised and deferred periods have been served.

It is also important to know that critical illness products cater for specific major critical illnesses, like open heart surgery, heart attacks, strokes and cancer. Coronavirus is not covered under this product offering.

If you feel you don’t have sufficient life cover in place as the pandemic spreads, don’t panic: insurers have the tools to service you online with no contact needed. Stangen gives new customers the ability to secure a policy within 10 minutes online.

What employers can do
Botha says there are a range of practical measures that employers can take to respond to the challenges posed by the coronavirus and the national lockdown.
• Put in place clear policies for self-quarantine, absenteeism, sick leave and working from home.
• Educate staff on how to protect themselves and others from the virus, and the importance of following the lockdown restrictions set out by the government
• Equip staff with the ability to work from home, and if sick or have contracted the virus make it clear how the company supports such cases
• Ensure you communicate clearly and work collaboratively. Be understanding and patient with your employees.

Quick Polls

QUESTION

How to give affordable and appropriate financial advice to the low income market segment. There is little room on a R50 pm policy for advisers to be remunerated for the time it would it would take to educate & fulfil admin function. What is the solution?

ANSWER

[a] Eliminate non-advice sales / telesales
[b] Implement industry standards for non-advice information
[c] Introduce an insurer-funded pro-bono advice network to low income earners
[d] Reinforce the Policyholder Protection Rules
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