ONE of the hardest realities to comprehend is that someday we will die.
Whilst death is certain, the time, date and circumstances of death remain uncertain.
The uncertainties surrounding death make Group Life Assurance Cover a necessity for those who care for their loved ones.
Imagine what will happen to your children, spouse and other dependents in the unfortunate event of your death?
Does it mean that the quality of education for your children will have to downgrade? Alternatively they might have to stop school?
Imagine the implications on their future? What about your spouse, does it mean he/she will have to immediately rely on your relatives?
Do they have the capacity, if at all the interest to look after your family? What about your parents who are heavily dependent on you for financial and medical support?
The questions relating to our unexpected demise can be better answered by having Group Life Assurance, also known in some markets as ‘beyond life cover’
The Group Life Assurance policy pays a lump sum to the beneficiaries stated in the policy, in the event of death of the Life Assured.
The benefit payable is often a multiple of the annual salary of the deceased.
It can be twice, thrice or five times of the annual salary payable.
The benefits are exempt from tax and will therefore be paid in full to the employer of the deceased who in turn pays the intended beneficiaries of the policy.
By way of an example let’s assume employee X was earning K5,000 per Month and they have a Life Assurance Policy on a benefit scale of three times, the total payable will be K5,000 X 12 X 3= K180,000.
It is a fact that no amount of money can equate the loss of a life but the life assurance payout helps in managing the transition period by absorbing potential negative drastic changes in the lives of the dependents.
Imagine what impact the death of a husband will have on the widow if she immediately fails to pay school fees due to the death, or fail to provide food to the children?
This may in turn result in distress, sickness and ultimately death of the widow. What about the children?
Is this what we want for our loved ones?
Some people may be wondering why I have named the policy Group Life Assurance as opposed to merely Life Assurance.
This is because the policy tends to be expensive when purchased on individual basis and conversely cheaper when purchased as a group.
It is therefore my indirect intention to motivate you to purchase the policy in groups especially through the use of the Human Resource Department in workplaces.
It is also important to point out that some employers provide the cover as a benefit to their employees whilst others facilitate the policy and the premiums are paid by the employees.
The Life Assurer will require the Name, Surname, Employee No, Date of Birth, Gender and monthly salary to be able to provide quotation.
Alternatively this information can be provided to a Broker or Agent and they will be able to source competitive quotations for you.
In some cases one may not necessarily die but is permanently disabled.
The Group Life Assurance policy pays a percentage of the death benefit for example 30 per cent, 50 per cent or 100 per cent in the unfortunate event of permanent disability.
The disability maybe either from accidental or natural causes.
The Funeral Expenses Costs are also covered as an auxiliary under the Group Life Assurance policy. It is therefore important to inform your broker or representative on your preferred Funeral Expenses Limit, for example K10,000.
In conclusion let me explain the term Free Cover Limit as it will certainly be part of the Group Life Assurance quotation that you will receive.
The Free Cover Limit is the maximum amount of cover that the Life Assurance Company is willing to provide without requesting the Life Assured to go for medical examinations.
It is therefore important for your Broker or representative to negotiate a Free Cover Limit that will be sufficient to accommodate all salaries without requesting the top-earner to go for medical examinations.
I have personally made a decision to show love to my loved ones by acquiring Group Life Assurance Policy and I am convinced that with this knowledge you will do same.
(Exclusively written by George Marekera, from Marsh Zambia)
Comments: webster@picz.co.zm or webster_tj@hotmail.com or on face book
search for Insurance Talk-Zambia page or call/text 0977 857 055
(The Author is a Chartered Insurer with more than ten years industry experience)