It’s vital your clients are insured as young as possible. Here’s why.

Nivash Manulal, Chief Distribution Officer at Bidvest Life

Most South Africans only start thinking about life insurance when they start their working lives. That could be a costly mistake. As students across the country start heading back to university, it’s more important than ever that their ability to earn an income in the future is protected.

Even a temporary injury or illness could result in their studies taking longer to complete and delaying their career, which could bring an unwanted financial burden to their families, says Nivash Manulal, Chief Distribution Officer at Bidvest Life. In the worst-case scenario, a more serious or permanent disability could affect their entire future earning ability, in which case they could remain financially dependent on their parents for the rest of their lives.

Take the case of Adam*, who was still a student when he lost the use of his arm in a hit-and-run accident. For most students, that would have been a major blow to their ability to forge a career and earn an income throughout their lives. Fortunately, Adam had Event Based Cover for students in place, which means his future earning potential is protected until retirement age.

“While students don’t yet earn an income, a student policy is important to protect parents against the financial impact should their child become ill or injured for any period,” said Manulal.

“From a parent’s point of view, when their child starts studying, they’re nearing financial independence. And while they’re not earning an income, if they were to get injured or ill, this would have a knock-on effect on their ability to complete their studies as planned. This would have an impact on how long they would take to become financially independent, which ultimately falls onto the parent to fund.”

Adam’s experience is not an isolated example. In fact, students were the sixth highest claiming occupation on Event Based Cover in 2021** - reason enough to make sure all your clients’ children who are 17 years and over, in high school or tertiary education, have income protection.

Event Based Cover is ideal for students looking for some level of protection. The cover includes everything from the minor like flu, to the major (such as stage 1 cancer, which could pay until the person recovers or up to retirement age, depending on their policy).

With Bidvest Life’s Event Based Cover, parents can start insuring their children from age 17 – that is, students who turn 18 on their next birthday, and tertiary students who are studying full-time, irrespective of qualification.

They can select up to R12 000 income protection per month, with premiums starting from as little as R100 a month, depending on factors like age and smoker status. This is an appropriate cover amount to take care of any costs that would be incurred by having a child at university.

They can also take out lump sum cover, which would provide for once-off or additional costs in the case of being diagnosed with a critical illness, permanent disability or passing away. Students can select up to R1 million cover for critical illness, disability or death.

Students can also take out a policy for themselves if they are 17 or older. For example, 18-year-old Sifiso* can take out Event Based Income, with Critical Illness Income cover of R12 000 per month; Extended Impairment Income of R12 000 per month; Permanent Impairment Lump Sum cover of R100 000; and Critical Illness Lump Sum cover of R100 000, all with the Future Cover Protector, for a premium of only R149.64 per month.

“Establishing sound financial habits is something everyone should learn as early as possible. Making sure your clients are covered against life’s curveballs from a young age is essential in today’s world,” said Manulal.

* Name has been changed to maintain confidentiality
** Bidvest Life 2021 Claims Report