Most types of insurance policies have a waiting period in effect the moment you sign up for cover. These waiting periods are a duration of time during which you cannot claim for a payout. Funeral cover is no different and it is important to understand how these waiting periods work and why they are in effect.
Firstly it is important to understand that a waiting period usually does not include claims related to an accident. In other words, if an accident occurs then your policy may still payout since this is an unforeseen circumstance. However, it is important to speak to your insurer for further clarity.
Secondly it is essential that you do not lie at the time of signing up for cover in order to bypass a waiting period as it can be subject to investigation. In the end the insurer may refuse to pay out altogether as you were dishonest and did not disclose all relevant information.
Natural Death Waiting Period
The first of the waiting periods for funeral cover that you need to understand is that related to natural death. For example, a person has a heart attack and dies or contracts an infection like meningitis and it is fatal. The waiting period for natural death is usually 12 months.
This means that should you or a family member who is covered on the funeral plan die from natural causes then the policy will not pay out. It is therefore advisable that you take a funeral cover as soon as possible rather than waiting till later. You can never be sure when illness and death will strike.
Pre-Existing Condition Waiting Period
The second waiting period for funeral plans is that related to pre-existing disease. Assuming that a family member has a heart condition at the time of signing up for cover, you will not be able to claim for the death of that family member if they pass on within 24 months from the date of policy inception.
It applies to any medical condition that can have life-threatening complications. In South Africa, diabetes, cardiovascular disease, tuberculosis and HIV are some of the common conditions that can lead to death. Therefore these conditions will be subject to a 24 month waiting period if you die from it.
Why are waiting period important?
Waiting periods may seem like an annoyance but they actually protect you as a consumer. There are endless cases where a person signs up for cover only with the intention of claiming in one or two months from policy inception. It does not only apply to suicide which is subject to a waiting period. This affects all the customers of that funeral insurance plan.
There are even people who sign up relatives for funeral cover immediately after the relative has died. They then delay the funeral for a month or more and attempt to lodge a claim with the insurer to cover the funeral costs. Others take up cover when they are just days or weeks away from death, since death is not always a surprise outcome like in late stage AIDS.