Look, I am not a huge fan of thinking about this stuff myself. But the title of this article caught me when I was reading in bed this morning, so I gave it a read. In light of recent events around EFC and with the whole Oscar Pistorius case going on, I thought one or two of you might want to ask yourself this extremely avoidable question too…
Can You Afford To Die?
With the South African population being under-insured for death and disability by more than 60 percent, it would be a fair statement to make that most South Africans, at present, cannot afford to die. The shocking fact is that more than half of the South African population cannot afford adequate insurance, due to the rather high levels of poverty. Rather than looking at this more apparent reason, we’ll examine why those that can and are purchasing life insurance, are not purchasing the optimal cover.
Confusion Over The Insurance Industry!
Unfortunately, despite the effort that some insurance providers have gone to, a lack of trust is still largely associated with the insurance market. The South African Insurers Association has stated that it is working towards changing consumer perception of insurance. There is much talk of change and the start of a new frontier in the insurance market in terms of the potential new lines of product development. The creation of micro-insurance policies are underway, which will be more affordable to the demographic of the population that is currently unable to purchase cover. This may solve the problem for those who have no insurance due to the cost associated, but may do little to educate those who are simply underinsured due to a lack of understanding of insurance.
Confusion over the insurance industry and being underinsured are things that are not exclusive to the South African population; with similar consumer purchase behaviour being noted in America, Asia and Europe. Insurance companies, by their nature, are forced to be relatively guarded so as to keep their formulas secret from their competitors. This often means that they’re unable to publish industry insights which may give an edge to top competitors, by revealing their focuses and statistics. Times, however, are changing and many insurance companies are becoming increasingly aware that the resulting lack of transparency has filtered down to their markets.
If you find yourself among those who are intimidated by insurance because of a lack of understanding, the most effective way to gain a better understanding is still to compare insurance companies and discuss with the best consultant. They will be able to advise you on whether you are under-insured or not.
Fear Of Planning For Your Death
There is a portion of the population that is not interested in purchasing or considering the purchase of life cover, simply because planning what would happen after their death is not something they are particularly comfortable with. This is understandable, as it is not the most cheery topic of conversation.
However, it is vitally important to ensure that you have the basics covered and are indeed doing your best to see to your family’s financial needs, should anything happen to you. If you, or someone you know, fall into that category then it may be time to reflect on this mind-set because the ramifications of failure to plan will be suffered by the family left behind by the deceased.
When you die your estate is divided up according to your will and tax legislation and, once everyone has taken their portion, there is often far less than you might imagine left over. This can impact heavily on your grieving spouse or, in the event of an early death, dependants – each of which are at the mercy of your life cover and estate planning.
Ask Yourself?
Have I set up my last will and testament?
Do I have an adequate life insurance policy that will cover any debt owed?
Do I have a funeral policy planned?
Do I have a designated power of attorney in the event of anything happening to me?
Do I have a handover ready of all important documents that my family may require in the event
of sudden death?
Do I have a good attorney and accountant to handle all affairs should I pass away?
If you’re not answering yes to most of the questions listed above, then it’s quite possible that, at present, you cannot afford to die. Unfortunately, you can’t schedule at what point you’re going to leave this life so it’s up to you to arrange for everything to be finalised to avoid leaving your loved ones in the lurch.
No one can predict when their time is going to come. Accidents happen, life is short. If you have a family; a husband, wife and children, it’s your duty to ensure that all your dependents are looked after. When you’re gone, you’re gone and anything you’ve left incomplete at that point will have to be dealt with by those remaining behind. A sound financial plan will ensure that, not only is your funeral planned and paid for but, your loved ones will be financially secure for years to come in your absence.
If you even suspect that you may be under-insured due to confusion over you cover, set up an appointment with an insurance consultant today, they’ll access how secure your estate would be after death. If reading this article is as real as you’ve ever allowed yourself to be on the topic of your own estate planning, then it’s time take advantage of the momentum you’re running on and compare life insurance quotes right now.
So… Can you afford to die? As scary as this sounds, I only answered yes to two of those questions. I definitely can’t!
