If you're thinking about getting life insurance for your parents, it's important to understand the process and requirements. Happily, we’ve kept things simple for you.
Getting Life Insurance Cover For Your Parents
In an ideal world, your parents would have taken out their own life insurance policy while they were still young and healthy to benefit from lower premiums. But this isn’t always possible. If you’ve been wondering if you can take out a life insurance policy on their behalf, the answer is yes – provided certain criteria are met.
In South Africa, you have the option to take out life cover for your parents. The payout can be used to cover any debt your parents might have incurred as well as pay off funeral expenses. Also, if you parents were helping you financially in any way, such as paying for your further education, a payout could ensure you remain supported. Just remember that you’d need their consent and would have to prove insurable interest.
What Is Insurable Interest?
As the premium payer, you need to show that you would suffer financial or emotional hardship if the life assured were to pass away. Immediate family members, such as your parents, usually meet the criteria for insurable interest as you can prove you have a close connection. Also, if their passing meant you’d have to take over certain financial obligation that you might not be able to afford, you’d most definitely have insurable interest.
Alternatively, if you parents are under the age of 65, they could apply for their own life insurance policy. While they’ll be the policyholders, there is no restriction on you paying for their premiums, as long as you can demonstrate insurable interest.
A Bit About Funeral Cover
While paying for your parents' life insurance policy is an option, it's essential to have open and honest discussions about your family's unique financial situation. You might discover their main concern is to simply not burden you with funeral expenses. In this case, considering the option of extending your own life policy with MiWayLife to cover your entire family. This way, funeral costs are taken care of without the need for multiple individual policies.
The Bottom Line
We understand that every family's situation is unique, which is why it’s always a good idea to contact us for a quick quote. We offer a 4-in-1 policy with just one monthly premium and our expert team can suggest the most suitable type of life insurance cover and the optimal coverage amount for your needs.
