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Credit Life Insurance

What you need to know about Credit Life Insurance during the pandemic

If your income has been affected by Covid-19, there is potential relief through our credit life insurance products.

Credit life insurance protection is a solution to help ensure that your credit repayments are covered when unforeseen events affect your ability to earn an income for example, if you are unable to earn an income due to disability, critical illness and retrenchment or death. There are different kinds of credit life insurance that may apply to your credit agreement so is it advisable to check your policy terms and the protection provided by your particular policy, to help you make the right decision about how to manage your repayments in these difficult times.

What cover does Standard Bank Credit Life insurance provide?

If your loan was granted after 9 August 2017 and the terms of the loan required compulsory comprehensive credit life insurance cover, our comprehensive credit life insurance product will cover installments for up to 12 months in the event of you becoming unable to earn any income. Our lending products that require comprehensive compulsory credit life insurance include all Personal Term Loans and Home Loans to customers who have a combined income of less than R25 000.

If your Housing Loan or Personal Term loan was granted prior to 9 August 2017 we will provide discretionary relief on your credit agreement installments for up to three months if you are unable to earn any income. This discretionary relief will be available in the period between 1 April 2020 to 30 June 2020 to assist you during these unprecedented times. These installment relief payments fall outside the credit life insurance policies.

If you chose to take out a voluntary credit life insurance policy linked to any of your other lending products such as Home Loans, Credit Cards, Vehicle and Asset Finance, Student Loans and Revolving Personal Loans, please review your policy terms to understand the events that you are covered for.

We will be sending direct communication to customers that helping to explain the terms and conditions of their individual credit life policies.

Remember, if you are stuggling to meet any of your financial obligations or arehaving difficulty in sourcing the relevant documentation in order to submit your claim, to avoid any negative impacts of possible delays, you are able to apply for any of our other lending relief options.

Read about all our relief options available on loan instalments and insurance.

"The Credit Life Insurance policies are underwritten by Liberty Group Limited. The Standard Bank of South Africa Limited is a juristic representative of Standard Bank Insurance Brokers an authorised FSP (FAIS no. 224). Terms and Conditions apply.

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Can you claim on your credit life insurance?

Your credit life insurance policy provides you with a safety net by covering your loan obligations should you lose your job, become disabled, get diagnosed with a critical illness or pass away before you have paid off your loans.

How do I claim and which documents must I submit?

The claims process in the table below applies only to the following policies:

  • Affordable Housing (AH) Policies that were taken after August 2017 (Plans Q and Plan R)
  • Debt Protection Plan Policies (DPP) that were taken out after August 2017 and required on Term Loans.
 
When you are Permanently Employed
Scenario Documents required at claims stage Validity of claim
My employer retrenched me as per Section 189 of the Labour Relations Act. Formal retrenchment documentation from Employer Standard claims requirements will apply Yes - provided the exclusions mentioned above don't apply
My Employer has reduced or removed my earnings and has applied to the UIF Fund for temporary COVID related relief (only applies during the lockdown period)   No - this is not a valid retrenchment claim.
I’m permanently employed and currently in quarantine, however I’m receiving full salary   No
When you work in the Informal sector:
For example: Domestic Worker/ Au Pair/ Care Giver, etc.
Scenario Documents required at claims stage Validity of claim
I’m employed in the informal sector and my salary has stopped due to no work no pay because of the lockdown -Letter from Employer  
-Bank Statements
Yes
When you are Self Employed:
For example: Contractor/ Photographer/ Event Planner/ Tour Guide / Restaurant Owner, etc.
Scenario Documents required at claims stage Validity of claim
I am self-employed/a contractor and have compulsory insurance with Standard Bank. Can I claim for inability to earn an income since I can’t continue my business/contract during the lockdown period? -Affidavit to state reason for not being able to earn an income, 
-Bank statements 
-Tax certificates
- Contract and payslip (if applicable)
Yes – Self-employed individuals can claim for their inability to earn any income during the lockdown period. Claims are only valid if no income is earned.
 

The claims process in the table below applies only to the following policies:

  • Voluntary credit life insurance policies with Retrenchment cover for permanently employed persons
 
When you are Permanently Employed
Scenario Documents required at claims stage Validity of claim
My employer retrenched me as per Section 189 of the Labour Relations Act. Formal retrenchment documentation from Employer Standard claims requirements will apply Yes - provided the exclusions mentioned above don't apply
My Employer has reduced or removed my earnings and has applied to the UIF Fund for temporary COVID related relief (only applies during the lockdown period)   No - this is not a valid retrenchment claim.
I’m permanently employed and currently in quarantine, however I’m receiving full salary   No
     

Frequently Asked Questions

1. What is Credit Life Insurance?

Credit Life Insurance is a type of insurance protection/cover that can provide cover for debt repayments in the event of death, disability, unemployment (retrenchment), inability to earn an income and dread disease. The exact benefits the client is covered for will depend on the specific plan they have.

2. What is the difference between retrenchment cover and cover for inability to earn an income?

Retrenchment cover:

Retrenchment cover will pay your monthly instalment on your loan when you lose your job and remain unemployed because of redundancy or retrenchment and you do not earn any money from any job or occupation. It does not cover resignation, voluntary retrenchment or retirement. This cover does not cover your salary loss but covers your obligations under the credit agreement that become due. This will be paid for the shorter period of 12 months, the remaining repayment period of the credit agreement; or until you are employed again. The full details of what is covered are in the policy terms and conditions. .

Cover for inability to earn an income:

This cover protects against your inability to earn an income. This does not cover your salary. It will cover your monthly instalment on your loan due to you being unable to earn any income. This means that your obligations under the credit agreement that become due and payable will be covered for the shorter period of 12 months, the remaining repayment period of the credit agreement; or until you are able to earn an income. This cover is only available on the following mandatory/compulsory credit life policies issued from 10 August 2017::

  • Debt Protection Plan, and
  • Affordable Housing Protection Plan.

3. Under which plans do we cover retrenchment and inability to earn an income?

The Standard Bank policies cover both retrenchment and your inability to earn an income, depending on the plan that the client has.

Cover for inability to earn an income is only available on the following credit life insurance policies (which were mandatory on a loan being granted):

  • Affordable Housing (AH) Policies that were taken after August 2017 (Plans Q and Plan R)
  • Debt Protection Plan Policies (DPP) that were taken after August 2017, as required on Terms Loans
  • Compulsory VAF Protection Plan (VAFPP) on taxis taken after 03 September 2019. 

All other credit life insurance plans where cover was not mandatory/compulsory may provide retrenchment cover but not cover for inability to earn an income. Please check which plan is applicable to a client to determine if they are covered

4. Does cover for inability to earn an income provide cover for when my income reduces?

No - you must earn no income and be totally unable to earn an income to qualify for this cover. Note that if you collect UIF this is considered replacement income and therefore clients will not be able to claim..

5. Am I covered after the lockdown if I am informally/self- employed?

During the lockdown period you must be completely unable to earn an income. However, after the lockdown period ends, your ability to earn an income will not be restricted and you will not be covered. .

6. I am placed on unpaid leave for 3 months, can I claim? I am then put through a Retrenchment process AFTER returning to work – can I claim again?

On policies that qualify, your policy will pay your credit agreement installments that become due and payable for the shorter period of 12 months, the remaining repayment period of the credit agreement; or until you again are able to earn an income. You can only claim in total for 12 months for retrenchment cover and cover for inability to earn an income combined, during the lifetime of your policy.

7. I am diagnosed with Covid-19 and hospitalised. Can I claim?

You can claim for Temporary Disability if you meet the criteria for a valid claim, and you are covered for this benefit under your policy. These would not qualify for Retrenchment Cover or Cover for inability to earn an income.

8. What is NOT covered under Retrenchment Cover and Cover for inability to earn an income under the Affordable Housing and Debt Protection Plans?

Unemployment or inability to earn an income resulting from:

 i) Retrenchment or termination of employment within the first 3 months after the commencement of cover under the credit life policy, where the term of the credit agreement is more than 6 months;
ii) Lawful dismissal including dismissal as a result of willful misconduct; that is a violation of some established, definite rule of conduct, a forbidden act, willful dereliction of duty or misconduct;
iii) Voluntary forfeiture of salary, wages, or other employment income;
iv) Voluntary retrenchment or termination of employment;
v) Resignation; vi) Retirement;
vii) Participation in an unprotected strike; and
viii) Retrenchment of which the consumer was aware or received notice of during the 3 months preceding the date on which cover under the credit life policy commenced.

 

9. What is NOT covered under Retrenchment Cover for all voluntary credit life insurance plans?

The Credit Insurance policy does not cover:

  • Contract, seasonal, part-time, temporary or casual workers; or
  • Self-employed people or workers that mostly earn commission;
  • If you lose your job because you are sick or become disabled or have a medical condition;
  • If you lose your job because of nationalisation or other government action;

The following conditions apply:

  • No benefit will be paid in the first 30 days of unemployment;
  • The retrenchment benefit will not be paid for more than 12 months;
  • No death or permanent disability claim has been approved;
  • The loss of employment must happen while cover is in place and before you turn 65

The benefit does not cover any claim if:

  • you resign, agree to be retrenched or retire from your employment;
  • your fixed-term contract expires;
  • you finish the job you were specifically employed to do;
  • you work at a branch or office outside South Africa;
  • you knew or should have known when the cover started that you would become unemployed or be retrenched;
  • you had not been working continuously for at least 12 months before losing your job .
  • You lose your job because:
    • you took part in an unprotected strike;
    • of misconduct, fraud or dishonesty;
    • you are sick or become disabled or have a medical condition;
    • you take part in a crime;
    • of nationalisation or other government action;

The full set of T&C’s are available to our clients should they wish to review it

10. What documents do I need to submit a retrenchment / inability to earn any income claim?

If you would like to submit a claim, please provide the following documents:

Formally employed

  • A copy of your ID
  • An official letter from your employer
  • Your UI19 (declaration from your employer to the UIF of work status)
  •  Your latest payslip
  • 3 months bank statements

Informally employed

  •  Letter from employer
  • Bank statements

Self - employed

  • Affidavit to state reason for not being able to earn an income
  • Bank statements
  • Tax certificates
  • Contract and payslip (if applicable)

Should any further information be required, the claims assessor will advise you accordingly.

11. Where can I send my claims document to?

If you would like to submit a claim, please send all claim documents to [email protected]

 

12. How long will it take to process my claim?

Once all the necessary documentation has been received to assess your claim, it could take between 7-10 working days to process your claim.

13. Who can I call for more information

To find out more or to establish your eligibility to claim on your credit life insurance contact Standard Bank on 0860 123 000, during office hours. 08:00am – 5:30pm.