The Underwriting Process

Your insurer will ask you a range of questions regarding your age, health, lifestyle, and occupation which is also known as the underwriting process. These questions will give your insurer insight on the chances of you claiming in the future. This will affect your premiums. For example, if you are a firefighter or a construction worker the chances of you making a claim are higher compared to someone who works in an office. This could attract a loading. However, this can be removed or reduced should the cause of the loading be improved. For example, if you attract a loading because you are a smoker and then quit smoking or you have been cleared for cancer.

What Is a Loading?

A loading is what can increase your premium. The more of a risk you are, the more likely it is that your insurer will include a loading to make sure that you are adequately covered. Things that can cause your policy to attract a loading are: 

• Health. A golden rule when it comes to taking out life cover in South Africa is to take out life insurance while you are still young and healthy because the older we get the more likely we are to succumb to illnesses that could place us at high risk.
• Age. Your age matters. The older we are the more likely it is for our health to deteriorate, dying, and being diagnosed with a terminal illness. This is why having a policy while you are still young or before the age of 65 can protect you should any of these things happen. 
• Gender. Keep in mind that insurers work with the latest and accurate data to make sure that you get a policy that is tailored for you. This also means looking at the risk that comes with insuring each gender. Statistically speaking, men are a higher risk compared to females which can cause premiums to be slightly higher.
• Occupation. Due to the level of risk certain occupations can have on your life, it can cause your policy to attract a loading.

The good news is that a loading, in some cases, is not fixed but can be removed or reduced if your situation improves by being less at risk.

Always remember to read the terms and conditions that come with your policy. Should there be anything that you still don’t understand, you can talk to your insurer to find out more.