Time to take cover in risky SA – Liberty Life

UNTOLD tragedy is brewing as a result of a growing mismatch between high rates of crime and road accidents and low rates of consumer awareness of disability risk.

The consumer alert has been sounded by leading life assurer Liberty Life in view of disturbing trends around South Africa’s ‘disability blind-spot’.

Liberty Life paid out R53 million in income disability claims and R166 million in capital disability claims in 2007.

The statistics, however, fail to shake the consumer’s it-can’t-happen-to-me mindset

Karin O’Brien, a Liberty Life’s Business Development Manager for Risk, notes: “South Africa is a dangerous place. Violent crime and horrendous road accidents not only result in death, they lead to severe injury and disability.

“This reality has been with us for some time, but the implications rarely sink in.

“Life policies should be step one in a thorough review that considers disability as part of wide-ranging risk planning. Yet many breadwinners still treat disability cover as an after-thought – if they think of it at all.

“Top-up disability cover is possible to complement group life and disability provisions, but these facilities are not accessed nearly often enough.”

The danger is that the disability message only gets across when it’s too late.

“We encounter tragic cases every week,” says O’Brien. “Cover is inadequate and it’s too late to put a solution in place.

“These tragedies will keep on happening until the consumer joins the dots … higher risks on the roads and the high rate of criminal violence mean higher risk of disabling injury.”

Some key facts drive home the point.

Experts estimate that one year of disability can wipe out 10 years of savings build-up. One of the most frequent causes of ‘distressed sales’ of residential property is the need to provide capital to supplement inadequate disability provision or no provision at all.

According to the World Health Organisation, 600 million people worldwide have to cope with disabilities.

A significant proportion of disabilities are caused by injuries resulting from road accidents, falls, burns and acts of violence. The incidence of disabilities relating to road accident injuries, interpersonal violence, war and self-inflicted injuries is expected to rise dramatically by 2020.

Karin O’Brien adds: “South Africans are not unique in their unshakeable belief that ‘it can’t happen to me’. But we face special challenges in view of relatively poor national provision for a social services safety net and our high rates of crime and road accidents.

“This makes it imperative that the life industry does more to raise awareness of these issues and that individual South Africans take greater responsibility for proper disability provision. When you’re disabled it’s too late.”