Online Reporter
WHEN Miriam lost her husband after a short illness, the grief was unbearable.
But amid the pain, she found comfort knowing they had a funeral policy that would cover all expenses.
After all, they had been paying premiums faithfully for years.
However, when she contacted the funeral assurer, she received devastating news: the policy was no longer valid.
Two months earlier, her husband had switched to a new funeral assurance provider that offered what seemed to be a “better deal”.
Unfortunately, he had passed away during the waiting period of the new policy, and the claim was rejected.
The family had to borrow money to bury him.
This story is fictional, but it reflects a reality that has affected many Zimbabwean families.
It highlights why understanding the waiting period, particularly for funeral/life policies, and the implications of switching between insurers is very important.
What is a waiting period?
A waiting period is the time between the start of a new policy and when benefits become payable. During this time, if the insured person dies from natural causes, the insurer is not obliged to pay out the benefits.
The waiting period is generally waived in the event of a road traffic-related accidental death.
The waiting period protects the pool of members and prevents situations where people might speculate and only take out cover for themselves or their dependents when death is imminent.
The length of the waiting period for new policies is usually a minimum of three months for immediate family members and up to six months for the extended family.
The period resets every time a new policy is taken out, even if you were previously insured elsewhere.
This means if a policyholder cancels a long-standing policy to join another insurer, they expose themselves and their family to risk. If death occurs during the new policy’s waiting period, the claim will be invalid.
With the old policy already terminated, this leaves the family or dependants stranded.
The cost of impulse switching
Many people change assurers because of minor differences in premiums, small incentives or marketing promotions. While cost is important, switching without understanding the waiting period can undo years of disciplined financial planning.
In Miriam’s case, her husband had been with his previous assurer for more than seven years.
His old policy was fully active without any surrender benefits attached to it.
But when a new company agent offered him “cheaper cover and faster claims”, he cancelled the old one.
He passed away two months later, during the new assurer’s waiting period.
The result was financial and emotional devastation for his family.
Consumers should remember that funeral/life insurance is about continuity of cover, not just price.
The years you have spent paying premiums are not wasted; they represent stability and peace of mind.
Cancelling a policy should, therefore, never be done impulsively or based solely on cost.
It is also important to understand that insurers are guided by contractual obligations and the law.
Once a policy is cancelled, the assurer cannot legally reinstate it retrospectively after death, unless there is a surrender benefits option.
Similarly, the new assurer cannot pay benefits for a policy still within its waiting period.
IPEC’s urgency for clarity
The Insurance and Pensions Commission (IPEC) has received complaints from families that discovered too late that their loved ones’ policies were still under waiting periods at the time of death.
In some cases, the misunderstanding stemmed from poor communication between agents and clients.
IPEC continues to urge insurers and intermediaries to explain waiting periods clearly at the point of sale.
For consumers, knowledge is the best protection.
The few minutes spent understanding your policy can prevent months, if not years, of heartbreak later.
Ask your assurer to explain the waiting period clause and request written confirmation of when full cover begins.
Miriam’s experience is a painful reminder that insurance is not just about signing forms and paying premiums.
It is about understanding the commitments and the timelines attached.
Her family’s financial struggle could have been avoided had they understood that cancelling a long-standing policy meant starting all over again, including the waiting period.
Consumers must, therefore, approach funeral/life assurance decisions with the same seriousness they give to other financial commitments.
Before switching insurers, always verify coverage details, waiting periods and any conditions for transferring cover.
IPEC urges all policyholders to read their policy documents carefully, consult licensed insurers and maintain continuous cover.
The peace of mind that funeral/life insurance provides is too important to risk over small savings or quick decisions.
Funeral/life insurance exists to protect your family when they need it most, but that protection only works if you understand how it operates.
About IPEC
IPEC is a statutory body established in terms of the Insurance and Pensions Commission Act [Chapter 24:21] to regulate the insurance and pensions industry for the protection of policyholders and pension scheme members.
For feedback or enquiries, please contact us at: [email protected]
