Any funeral assurance policy, just like any other insurance policy, is a contract that creates rights and obligations or responsibilities between the funeral assurance company and the policyholder. It is therefore, important that both parties to the contract clearly understand their roles in order to avoid potential conflict that may arise from the arrangement.
Once the funeral assurance contract is finalised, the following rights and responsibilities immediately accrue to the parties
Rights of the assurer:
- To receive the agreed premium when it falls due;
- To be informed of the risk insured (death in this case) within a reasonable period once it occurs;
- To lapse the contract if agreed premiums are not received for a given period of time; and
- To withhold service if premiums are not up to date.
Rights of the policyholder:
- To have the agreed funeral service and other terms of the contract performed by the assurer upon making a claim;
- To be informed of any changes to the terms of the policy;
- To be issued with a policy document that clearly details the terms of the
- arrangement; and
- To be adequately compensated if the assurer fails to provide the agreed service upon making a claim.
It should however, be noted that for either party to fully enjoy its rights, as stated above, it should also be ready to meet its obligations and responsibilities as indicated below.
Responsibilities of the assurer:
- To provide the funeral service as well as meeting all the agreed terms of the policy upon receiving a claim from the policyholder;
- To immediately advise the policyholder of any changes to the contract that he may wish to make; and
- To provide the assured with a contract document.
Responsibilities of the policyholder /beneficiary:
- To immediately inform the assurer of the death of a beneficiary once it occurs;
- To ensure that all documents required for making a claim are available at the point of making a claim;
- To inform the insurance company of any addition or removal of a beneficiary to the policy; and
- To make sure that the agreed premiums are paid on time in order to avoid a possible lapse of the policy.
Policyholders are strongly encouraged to honour the payment of premiums as this is a key responsibility placed upon them.
Non-payment of premiums may result in the policy losing its validity. For most policies without some savings component, this means a policyholder can no longer make any claims on the contract unless the policy document had a clause on refund of some savings.
The policy document should specify the period after which, non-payment of premiums should result in the policy contract becoming void. Such periods should be consistent with the requirements of the Insurance Act [Chapter 24:07].
A subsequent non-payment of premiums without communication with the assurer for a period exceeding three months, may result in the assurer cancelling the policy due to non-payment.
However, a funeral policy remains in force for a specified period as indicated below, where premiums have not been paid, as long as the member has regularly paid premiums for at least five years.
| Period for which premiums have been paid | Period remains in force |
| 5 years or over and less than 7 years
|
6 months |
| 7 years or over and less than 9 years
|
9 months |
| 9 years or over and less than 11 years | 12 months |
| 11 years or over and less than 14 years | 18 months |
| 14 years or over and less than 17 years | 24 months |
| 17 years or over and less than 21 years | 36 months |
| 21 years or over and less than 25 years | 48 months |
| 25 years or over | 60 months |
Where all policy conditions are met, the policyholder should insist on receiving all the promised benefits as per the contract. Failure of which, the policyholder can approach the Insurance and Pensions Commission for redress.
The Zimbabwe Association of Funeral Assurers (ZAFA) wrote this article but there were additions by the Insurance and Pensions Commission (IPEC)
Contacts:
Zimbabwe Association of Funeral Assurers – ZAFA
240 Samora Machel Avenue,
Belvedere, HARARE
Tel: 0772 214 117; 0716 341 734;
Email: takasvosve@gmail.com; zafaoffice@gmail.com