Funeral cover, and what you are really paying for
The most widely held insurance in South Africa, and the most heavily sold. It does one useful job quickly, and it is also where people quietly pay several premiums for cover they already have. Here is how to check.
What you can actually buy
Start here. Choosing the wrong level is a more expensive mistake than paying slightly too much for the right one.
Individual cover
Covers one person for a set amount, paid to whoever you name. Simple and quick to pay out, usually within forty-eight hours of the claim being accepted.
Family cover
Covers you, a spouse and children under one policy, generally at a lower total cost than separate policies. Children are usually covered for a smaller amount than adults.
Extended family cover
Adds parents or other relatives, usually for an extra premium per person and with age limits on who can be added. This is where the monthly cost can quietly get large.
What catches people out
None of this is hidden. It is all in the wording nobody reads until the day they need it.
Paying for cover you already have
Many people hold funeral cover through a bank account, a retailer, a burial society and a standalone policy at the same time. Each one pays out, but you are paying four premiums, and the total is often far more than the funeral would cost.
Waiting periods
Cover for natural causes typically does not start immediately. Accidental death is usually covered from day one, natural causes after a waiting period. Switching policies restarts that clock, which is the risk in taking a cheaper offer.
What happens if you stop paying
Funeral cover has no savings value. Miss the premiums and the policy lapses with nothing to show for the years you paid. It is not a savings plan, whatever it was sold as.
Age limits on the people you add
Parents and grandparents often cannot be added past a certain age, and premiums for older members climb sharply. Check before you build a policy around covering them.
Cover that does not match the cost
Work out what a funeral you would actually arrange costs, then insure for that. Being covered for far more than you need is simply a higher premium every month.
What moves the price
Some of this you can change and some you cannot. Knowing which is which is most of the negotiation.
- 01
How many people are covered
The main driver. Every extra member adds premium, and extended family adds the most.
- 02
The ages of everyone on it
Older members cost considerably more, particularly on extended family cover.
- 03
The payout amount
What the policy pays when it pays. More cover, more premium, in a fairly direct line.
- 04
Whether it is standalone or attached
Cover bundled into a bank account or store account is convenient and frequently more expensive than the same cover bought on its own.
What to ask before you sign
Ask these, and get the answers in writing. A good insurer will answer all of them without hesitating.
- 1List every funeral policy I am paying for, including through my bank and any store accounts.
- 2What is the waiting period for natural causes, and has mine passed?
- 3Exactly who is covered, and for how much each?
- 4How quickly does it pay out, and what documents does the family need?
- 5What happens if I miss a month?
- 6Can I add my parents, and what does that cost as they get older?
Questions people ask
- How much funeral cover do I need?
- Work out what the funeral you would actually arrange costs, then cover that, plus a little for the immediate costs the family carries in the first weeks. Insuring for a much larger amount is a higher premium every month for money nobody needs on the day.
- Can I have more than one funeral policy?
- Yes, and each one pays out separately. That is legal and sometimes deliberate, but it is also how households end up paying four premiums without meaning to. It is worth listing every policy you hold before buying another.
- Why has my claim not paid out?
- The two usual reasons are a waiting period that had not finished, or premiums that lapsed without the policyholder realising. If you believe a claim was wrongly refused, you can take it to the National Financial Ombud at no cost.
Work it out yourself first
Ready to see what it costs?
Tell us once, and you choose which insurers get your details. No cold calls from anyone you did not pick.