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How disability insurance policies work In South Africa

29 November 2022
5 minute read
woman and child

Disability can strike anyone at any time and the financial impact can be devastating. With disablement insurance you can protect yourself and your family against the loss of your monthly salary and the additional medical and other expenses that come with a disability. Let’s answer your questions about how 1Life Disability Insurance policies work, how much cover you need and how the claims process works.

What is disability cover?

Disability insurance pays out a tax-free lump sum if you are permanently and totally disabled by accident or illness. You can use the pay-out as you see fit - be it to cover living and medical expenses, pay off your debt or customise your car and home to help you adapt to your disability. There are two types of 1Life disability cover . Occupation-based Disablement pays out a lump sum if the policyholder becomes totally and permanently disabled and can't perform their regular job or any other job based on their education, training, and experience. Another type of disability cover is the Event-based Disablement benefit, which pays a percentage of the sum assured according to specific criteria described in the policy book. Any claim paid out reduces the amount available for future claims, and once a cumulative amount of 100% of the total sum assured has been paid out, no further pay-outs for this benefit will be considered and the cover will cease. For example, you will receive a 50% pay-out of your sum assured if you lose a limb and a 100% pay-out if you are totally blinded in both eyes.

Save up to 13% on your life insurance premiums if you buy online.

How much disability cover do I need?

Talk to your financial adviser or one of our skilled consultants about how much cover you might need and what you can afford to pay monthly in premiums. They will take factors such as your occupation, income, age, health and affordability into account when working out your sum assured.

How much does disability cover cost?

Your financial needs analysis helped you work out how much cover you need, but how much will that cover cost? Ask your advisers or our consultants for a disability cover quote. Your monthly premiums will be based on your specific risk profile, taking factors like your age, gender, occupation and health into account.

When will a disability cover policy pay out?

A disability insurance policy will pay out according to the type and amount of cover you bought. For example, Mary is a 45-year-old office manager who has a R1 million occupation-based disability policy. She is injured in a car accident and loses the use of both of her arms. As she is permanently and totally disabled and cannot do the work that she was trained to do, her policy pays out in full.

Visit the 1Life Disability Insurance FAQ page to learn more about how to claim, time limits for claims and how long it takes for claims to be paid out.

When will a disability insurance claim be rejected

When you buy 1Life Disablement Cover you will be given a policy schedule and a policy book. Read both documents carefully. In your policy schedule take note of any specific exclusions that have been applied to your policy. For example if you regularly take part in a high-risk sport like rock climbing this activity might be listed under policy exclusions. This means that if you are disabled while rock climbing your claim will be rejected. In your policy book you will find the general exclusions that apply to your policy, for example a claim will be rejected if you are disabled while driving under the influence of alcohol or committing a crime.

Top tip: When you take out a 1Life Insurance policy you will be asked many questions about your medical history, smoking status, lifestyle, hazardous pursuits, occupation and income. Withholding information to benefit from lower monthly premiums or to obtain cover without exclusions could result in reduced or rejected claims so be sure to answer all questions honestly.

Take the first step with 1Life Disability Insurance

Get up to R10 million tax-free lump sum if illness or an accident leaves you permanently disabled. Talk to one of our skilled consultants and get the cover you need with 1 simple call and no paperwork.

The views and opinions expressed in this article are those of the authors and do not necessarily represent or reflect the views of 1Life Insurance or its employees.

We answer your questions about our products and services!

Can disability insurance cover pre-existing conditions in South Africa?

Most policies may have a clause that prevents you from obtaining insurance cover for any condition that you were treated for or that you knew about or should have known about prior to the effective date of the policy. This is known as a pre-existing condition and any such condition not disclosed to the insurance company will most likely result in a claim for the condition being rejected. It bears repeating that when you take out an insurance policy, the responsibility lies with you to provide the insurer with all the necessary information, so that the company can correctly assess and price your risk.

What is the waiting period before disability insurance benefits are paid out?

With 1Life Insurance's disability cover, you're covered immediately for accidental disablement upon receiving your first premium. Payouts are made upon permanence or 0 - 3 months from date of disability.

Are mental health conditions covered under 1Life Disability Insurance?

Yes. If it was disclosed when taking up the policy, and disability insurance was offered without any exclusions for mental health.

How does the policy handle partial disabilities or injuries that don't lead to total disability?

Event-based Disablement pays out a percentage of your cover amount for disability, according to the tables in your policy book, even if you are still able to work. Occupation-based disability is paid out upon permanence if all claim requirements are met. *Terms and conditions apply.

Is there an age limit for obtaining disability insurance with 1Life in South Africa?

You have to be between the ages of 18 and 59 to purchase 1Life Disability Insurance. Your cover level will decrease from your 60th birthday until five years before you turn 65 or your selected retirement age, whichever is earlier.

What happens if I switch jobs or occupations after obtaining disability insurance?

The monthly disability insurance premium is based on your specific risk profile. This means that we take into account factors like your age, gender, occupation, lifestyle and health when calculating your monthly premium. Should there be changes that affect your risk profile, such as a job change, you need to inform 1Life Insurance to ensure you are still adequately covered.

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