The petrol price is constantly going up, many salaries aren’t keeping up with the cost of living and let’s not even talk about the expenses associated with the holiday season.
Economically, South Africa isn’t in a great place right now but this makes it even more important to have a life insurance policy to create a financial safety net for your family. Still, if you’re feeling the pressure and wondering what might happen if you had to miss a premium payment, this article is for you.
A lapse isn’t the end of the road
If you have a life insurance policy with MiWayLife and miss a premium payment, we’ll send you a notification via email and SMS. We understand that life can get busy and unexpected expenses can throw off your budget, which is why we offer a grace period during which you can make up for the missed payment. This grace period typically spans 15 days, giving you some breathing room to plan and make the necessary payment. Just bear in mind that you’ll still be debited again at the end of the month for the following month’s premium.
For example, if your policy's regular debit order is scheduled for the 25th of January and you happen to miss the payment, you'll have until the 20th of February to catch up – but you’ll also be debited again on the 25th of February to cover the following month.
What happens if I don’t make the grace period?
If you fail to make up that missed premium payment during the grace period it could result in your policy being cancelled. After that first missed debit, MiWayLife will continue to attempt to debit you for three months. If we can’t, your policy will be automatically cancelled. You don’t get back the premiums that you’ve already paid and, if you had to make a claim after the grace period – having failed to pay that outstanding premium – any claim will be denied.
Can I reinstate my life insurance policy?
Yes, this is the good news. If your policy is cancelled, you can reinstate it within 2 months of the lapse. No new waiting period will apply and no terms and conditions will be changed. However, once that two month period has passed, you’ll have to apply for a new life insurance policy and certain waiting periods will apply. In this case, the 2-year clause will come into effect. This clause will also kick in if you choose to cancel (in the life insurance world, we use the word “surrender”) your life insurance policy.
What is the 2-year clause?
Life insurance is designed to protect you as well as the life insurance company. The 2-year year clause is essentially a waiting period that relates to those who pass away due to suicide. Should a policyholder die due to suicide during the first 2- years of having their policy, an insurer can deny their claim. This is why it’s important to always read your life insurance policy’s terms and conditions.
For the record, all new life insurance policies with MiWayLife include the 2-year clause. If you’ve been paying your premiums for more than 2 years, it won’t apply to you. But if you’ve taken out a new policy after surrendering an old one, it will start afresh.
What can I do if I’m struggling to pay my life insurance premiums?
If you’re worried about the cost of your life insurance premium, you’ll be glad to know that letting it lapse or surrendering it isn’t your only option. MiWayLife is proud of its flexibility and allows you to choose to lower your premiums at any time. This means your cover amount will be reduced, but it’s better than having no cover. You can also always increase your premiums and cover amount when you’re no longer in a tricky spot financially. At the end of the day, life can get expensive, but there’s no better investment than buying peace of mind.
Did you know:
You can now take out life cover with us online in a few simple steps. No calls and no agents! Make sure to take care of those you love today by buying MiWayLife cover online.