Having funeral cover is a necessity these days. With the rising costs associated with funerals, funeral cover eases the burden of arranging a funeral.
One of the cons of this growing industry however, is the rife scams.
In 2015, scammers targeted vulnerable social grant beneficiaries in the Northern and Western Cape. Brokers selling 1Life policies were coercing the elderly into buying funeral cover. This scam exposed the lack of knowledge about how funeral cover works and consumer rights.
How to avoid funeral cover scams:
One of the easiest ways to avoid becoming a victim is by paying attention to the funeral cover provider’s track record and their transparency.
Avoid falling victim to funeral cover scams by dong your homework and considering the company’s reputation.
Speak to family and friends to inform your decision. They may help advise you about reputable companies.
Be careful of insurers who are not forthcoming with information and those who simply ignore your questions. Fraud can be described as deliberate misrepresentation of facts in order to gain financially at the expense of another. Such companies should raise red flags.
Never share banking or payment details before you have accepted their offer. You should know your rights as a consumer and how to protect yourself from fraud.
Don’t be distracted. Real value lies in the pay out and that should be your focus. You need to make sure that the funeral cover provider is financially stable and will afford to pay out when you claim.
Avoid over-paying by finding a policy that will cap premium payments once they have reached the sum insured.
When taking out funeral cover, you need to consider:
- The amount of the final cash pay-out
- The monthly premium and the percentage of annual increase
Do not agree to anything you do not understand. You should fully understand the terms of the funeral cover policy before you accept anything.