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Thursday, May 26, 2022

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Is everyone you care about covered this holiday season?

Published Dec 13, 2021


By Dominique Bowen

It’s been dubbed the “silly season” for a reason; reflecting on our notorious history of December headlines, as a country we don’t take half as much heed of “Don’t drink and drive” and “Arrive alive” campaigns as we ought to. During the 2020 festive season we saw nearly 1 500 die in 1 210 road accidents, with more than half occurring over weekends, suggesting that the majority of crashes took place within residential areas and not en route to destinations. It points to everyday recklessness, and the tragic results of those choices this time of year is infamously known for.

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There are some key decisions you can make now to bolster your lines of defence against the festive season mayhem. Importantly, drinking responsibly is one of them. Even if you don’t drink, the reality is that you’ll be surrounded by revellers. Choose to apply that K53 mindset to anticipate and prevent any accident (physically and financially) before it happens.

You can do your best to stay safe out there, but there will always be those “what-ifs”. Those “what-ifs” – perhaps the tragic death of a loved one, or yourself – come with their associated emotional, psychological and mental trauma, which can only be compounded by the financial stress of either arranging a fitting burial, making sense of a messy estate, or battling to make ends meet now that a home is without its breadwinner.

“The last thing any family needs is to face a tragedy over the festive period where there isn’t sufficient cover or any cover in place,” says Sheila-Ann Robey, a Liberty financial adviser. Are you covered on the below fronts?

Your family has changed

“Reviewing the beneficiaries on your policy is something to think about in the case of welcoming a new addition to your family,” says Willem Smith, executive head of distribution at Hollard Life Solutions. This could be through the arrival of a baby, or a marriage. In fact, Smith says even just entering into a long-term relationship or moving in with a partner should trigger the conversation about updating your policies. “[In the case of funeral cover], you don’t want your partner to sit with the financial burden of laying you to rest if the unthinkable happens.”

Perhaps, reflecting on the past 12 months, you have suffered a loss in the family, or you have gone through a divorce. These are also important changes to include if your family member or former partner was a beneficiary on any of your policies. “In the event of a divorce, you may want to ensure that your children are the primary beneficiaries of your policy,” says Smith.

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You’ve got more stuff

If your family structure hasn’t changed, don’t let that discount the need for a cover review. You may have added to your estate, or taken out a cash loan. If something were to happen to you, would your liabilities be adequately covered? “If you’ve financed the purchase of a car or a house, you want to ensure that any debt outstanding is fully covered in the event of your death or disability,” says Smith.

It pays to get your ducks in a row

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There is tremendous value in ensuring your insurer has an accurate record so that they can pay claims quicker. Depending on the complexity of your life cover, straightforward claims can take anywhere between 48 hours to two weeks, depending on your insurer, and up to a couple of months in more complicated scenarios. It is for this reason that you should ensure your affairs are always in order to prevent any administrative challenges for the people you leave behind,” says Robey. To meet the immediate need of arranging a fitting send-off, some funeral policies pay out in as little as four hours on receipt of all necessary documentation.

What about your will?

If you’ve updated your policies, do your will while you’re at it. Zale Hechter, CEO of Cliqtech, creators of SmartWill, says the birth of a child or a divorce are the two most easily forgotten life changes when people update their will. “You only have three months after a divorce to update your will, after which the original will remain in force, with your ex-spouse as the beneficiary of your estate,” he adds. “If you have children, you need to protect them through a testamentary trust and ensure they have guardians that you approve of.”

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If partners and children don’t apply in your case, is a will still necessary?

Absolutely. “The law says you can draft a will from the age of 16 years old,” says Hechter. “Most of the time this is seen as quite young, though, so normally we would recommend starting from at least 18 years of age.” The earlier you start, even if you’re leaving your car or smaller valuables to a family member, the less catch-up you’ll need to do when your estate grows or you add to your family.