SA insurance landscape opportunity

More than 4 million individual funeral policies were sold in South Africa in 2025. That points to a large and active market, but not necessarily a saturated one. When we look beyond sales volumes at who has cover, where the gaps remain and how many policies lapse or are never taken up, a more nuanced picture emerges.

For advisers, the opportunity is not simply to sell more funeral cover. There are underserved segments to reach, persistency challenges to address and clients who may need broader protection through a combination of funeral and life cover. We unpack the numbers for the individual retail market, excluding group cover, to see where the strongest opportunities may lie.

Funeral cover in South Africa: room for growth

Estimates from the Actuarial Society of South Africa and FinScope put the number of South Africans with funeral cover at around 50%, with some holding multiple policies.

Annual sales of funeral policies, according to Asisa stats, were over 4.3 million in both 2025 and 2024, with 3.5 million new policies sold in 2023. Although lapse rates and NTUs are high, at the end of 2025, 9 million funeral policies were in force. This does not take into account cover from burial societies or policies held through group benefits, both of which would increase the total number of policies in the country.

Funeral cover is a lot more widespread than other types of insurance, but the numbers suggest there is still room for growth.

2025 research from the Actuarial Society found that funeral cover is most widespread among:

• The formally employed, including government and private sector employees.
• SASSA grant beneficiaries, who are only partially covered. Our research suggests that out of 4 million grant recipients who qualify for cover, only around 70 000 have a policy.

Preventing lapses and NTUs

While the stats and number of new policies taken out each year suggest a thriving market, lapses and NTUs are problematic.

• 3.2 million policies lapsed in 2025, according to Asisa.
• The Actuarial Society research found that 55% of all new policies “do not persist beyond the first year” and 23% are classified as NTUs.

We’ve previously shared how lapse rates reduce when premiums are paid by a salary stop order. NMG research comparing stop-order premium payments to debit order and cash premium payments came to the same conclusion:

• Overall lapse rates can be reduced fourfold over the life of a policy when premiums are paid by stop order
• First-year lapse rates can be reduced by half

Final assessment: plenty of room for growth in the funeral cover market but lapses and NTUs need to be monitored closely and avoided or reduced by offering stop-order payment options.

Funeral + life cover: more room for growth

While the funeral market presents some growth opportunities, our research shows that there may be more significant prospects for policies that offer both funeral and life cover.

Public sector market

This market is growing and looking for more than just funeral cover, although affordability remains a constraint. Group cover is available but not always adequate and when a person leaves the government’s employment, group benefits fall away.

• 50 000 to 70 000 new entrants each year
• Increasing interest in funeral plus life cover

Private sector market

Opportunities abound as this market has been underserviced compared to the public sector.

• Around 4 to 5 million earners who earn between R6 500 and R25 000 a month, where funeral and life cover is highly valued.
• Around 2 to 3 million people are employed in large corporates that offer comprehensive group cover.
• Smaller businesses and industries such as hospitality, security and logistics offer numerous opportunities as cover is limited, if offered at all.
• Salary stop-order payments can be set up for many of these employees on their payroll systems.

What to offer public and private sector markets

Funeral and life cover offer families financial protection against the high cost of funerals and loss of earnings on the death of a breadwinner. However, clients in this market are becoming more discerning and are looking for:

• Flexible policies that offer life and funeral cover and are easy to take out
• No or limited underwriting
• Digital servicing options
• Loyalty programmes with tangible benefits
• Affordable premiums
• Fraud protection using verifications such as biometric ID scanning

Good to know: Licensed insurers offer policyholders more protection as they are highly regulated and score high on affordability. The Actuarial Society research found that burial societies often charge the highest premiums compared to the benefits offered while “providers with direct access to policyholders’ bank accounts,” including insurers, banks and retailers that can use debit orders, “are able to offer substantially cheaper cover.”

Final assessment: the opportunity to grow business in this market is high as there are many potential clients looking for ways to protect wealth and their loved ones.

Closing thoughts

Asisa members paid 579 296 death claims for funeral policies in 2025 to the value of over R9.6 billion. This gave families the funds needed to pay for funerals and memorials without having to take on debt. The stats show that many more could benefit from the financial protection funeral policies offer, as well as the added protection life cover offers.