Life cover in South Africa

The four kinds of life cover

The Insurance Act sorts life insurance into classes. The "risk" class is what most people mean by life insurance; it pays on a death event, a health event or a disability event. Insurers give their products their own names, so read what the policy actually pays on.

Employers and retirement funds also buy group versions of these covers for their staff or members. If you have cover through work, ask for the benefit statement before buying more.

Which laws protect you

• Insurance Act 18 of 2017 — who may sell life insurance (licensed insurers only) and the classes of business. Check a company on the Prudential Authority's list of insurers or on our page on insurance companies.
• Long-term Insurance Act 52 of 1998, section 62 — the basis for the Policyholder Protection Rules (PPRs), gazetted on 15 December 2017 (in force 1 January 2018) and amended on 28 September 2018 (in force 1 October 2018). They are enforced by the FSCA.
• Whoever sells or advises you must be an authorised financial services provider (FSP) or its representative — check on the FSCA register.

What the insurer must tell you

Under PPR rule 11.5, no later than 31 days after the policy starts the insurer must send you, in writing and separate from the policy wording:

• evidence of cover and how and when benefits are paid to you or your beneficiary;
• all charges and fees, and the commission paid to the intermediary;
• all exclusions and limitations, with the significant ones shown prominently;
• your right to cancel and how to claim;
• the statements you made that the insurer treated as material to its risk assessment — check them carefully, because wrong answers are the classic reason for a rejected claim.

You must also receive a copy of the policy within 31 days, and you can ask for a copy at any time (rule 11.5.3 and 11.5.4).

Changed your mind? The 31-day cooling-off right

PPR rule 4.2 (as amended in 2018) lets you cancel a new policy, or a change you asked for, within 31 days of receiving the rule 11.5 information, as long as no benefit has been paid or claimed and nothing insured has happened. It does not apply to cover that lasts 31 days or less.

1. Send the insurer a written cancellation notice (keep proof of the date).
2. The insurer must act on it within 31 days (rule 4.4).
3. You get back what you paid, less the cost of the cover you actually had and, for investment-linked policies, any market loss (rule 4.3).

Missed a premium: grace period and lapse

Rule 15A, added in 2018, says that if a premium is not paid on its due date the insurer must tell you within 15 days, and your cover stays in force:

• for 15 days after the due date if you pay monthly (or more often);
• for one month after the due date if you pay less often;
• or longer, if your policy says so.

If you die or claim during that grace period, the claim is valid but may be reduced by the unpaid premium (rule 17.11). A policy clause that lets the insurer reject a claim because the premium was late, when you paid within the grace period, is void (rule 7.1(e)). After the grace period, a policy with no cash value lapses; one with enough cash value is dealt with as rule 15A.3 sets out (kept in force from its value, made paid-up or surrendered).

Replacing an existing policy

Swapping one risk policy for another can lose you cover (new exclusions, new waiting periods, older age at entry). PPR rule 19 therefore makes the new insurer ask the adviser whether the policy is a replacement; if so, it must get the adviser's record of advice and send it to your old insurer within 14 days, and a senior manager must confirm within 14 days that the record shows why the new policy suits you better.

If the insurer later finds the adviser hid that it was a replacement, it must report this to the regulator and tell you that you may cancel the new policy under the cooling-off rule within 31 days of being told (rule 19.2.5).

Claims: deadlines the insurer must meet

• The insurer must record your claim by the next business day after it is received, even if documents are missing (rule 17.8.7), and may ask only for documents essential to assess it (rule 17.8.5).
• It must accept, reject or dispute the claim within a reasonable period and tell you in writing within 10 days of deciding (rules 17.6.1–17.6.2).
• A rejection must give reasons and tell you that you have at least 90 days to make representations to the insurer, plus how to complain to the ombud (rule 17.6.3).
• The insurer must answer your representations within 45 days (rule 17.6.5).
• It may not reject a claim only because of a polygraph or lie-detector test (rule 17.10), and a clause forcing disputes into arbitration is void (rule 7.1).
• A wrong or missing answer on your application cancels cover only if a reasonable, prudent person would see it as material to the risk (rule 21). If your age was wrong, benefits are adjusted to the correct age (rule 21.3).

If the insurer's final answer is still no, complain free of charge to the National Financial Ombud Scheme (NFO), which took over the Long-term Insurance Ombud and began work on 1 March 2024. Our complaints guide explains the steps, and policyholder rights lists the rest of the rules.

Beneficiaries and keeping cover up to date

• Name your beneficiaries on the policy and update them after a marriage, divorce or birth. Ask the insurer for written confirmation of every change.
• Tell your family which insurer you are with and where the policy documents are; a claim cannot be paid if nobody knows the policy exists.
• Rule 11.5.1 requires the insurer to tell you if you need to review your cover periodically — check the amount against your debts and your family's needs every few years.
• The insurer may end a policy for reasons other than non-payment or a change in risk only with 31 days' written notice (rule 20.2.1).

Sources

1. Insurance Act 18 of 2017 — Government Gazette 41388, 18 January 2018 (gov.za)
2. Long-term Insurance Act 52 of 1998 — Government Gazette 19276, 23 September 1998 (gov.za)
3. FSB — Policyholder Protection Rules (Long-term Insurance), GN 1407, Government Gazette 41321, 15 December 2017 (gov.za)
4. FSCA — Amendment of the Policyholder Protection Rules (Long-term Insurance), GN 997, Government Gazette 41928, 28 September 2018 (gov.za)
5. Prudential Authority (SARB) — list of licensed insurers (live register, seen 29 October 2026)
6. FSCA — search for authorised financial services providers (seen 29 October 2026)
7. National Financial Ombud Scheme South Africa — About us (seen 29 October 2026)