Nondisclosure in life cover applications is increasing
The highly significant Nathan Ganas saga brought the importance of full disclosure into the public domain
Failing to disclose important health information in life cover applications is a growing problem in SA and leads to life assurers turning down claims. According to figures from the Association for Savings and Investment SA (Asisa), the SA life insurance industry repudiated a total of 5,026 claims —worth more than R1bn — in 2017, mostly because of nondisclosure or misrepresentation of material facts at the time of application. It is distressing for consumers who diligently maintain their premiums to hear about incidences of life insurance companies not paying out claims, says Stacey Roper, certified financial planner at Alexander Forbes Financial Planning Consultants. A recent example of nonpayment — which was later reversed after public outrage — was Momentum, which refused to pay out life cover of R2.4m to Durban widow, Denise Ganas, in November following the murder of her husband in a hijacking incident. Momentum had rejected the claim because her husband failed to disclose that h...
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