A person or company registered as an adviser on matters of insurance and as an arranger of insurance cover with an insurer on behalf of a client.

A broker’s job is to help you to identify the risks that you may be exposed to. The broker will advise you on what insurance’s are available for these risks and will canvas the wholesale business insurance market to obtain the most advantageous terms for these covers providing you with the insurance quotes. The broker will then discuss this with you and when agreed place the cover with the chosen insurer/s and arrange the documentation at the specified insurance rates.

The broker will also help you with general insurance advice and information as required and look after any amendments to the policies that may be required. With any claims, the broker will assist you in formulating the claim and will liaise between you and the insurer to bring the claim to a successful resolution.

Insurance is a complex business.  Premium increases are sometimes necessary, even on claims-free policies, reflecting general increasing costs for insurers.  Policy premiums are in part dependent on the overall claim levels within the industry (both legitimate and fraudulent), the state of the economy, the levels of protection required and the degrees of risk that customers will accept.  Increasingly, global issues such as weather-related disasters can work their way through and have a bearing on local rates.

Generally no, brokers make their money by receiving commissions from the insurance companies that they place your business with.  There is no direct charge to you for a broker’s services. 

The FSB (Financial Services Board) supervises and enforces compliance with the Long- and Short-term Insurance Acts of 2002. Registration & Compliance is a regulatory requirement for any person or business providing advice on financial matters of any kind. The first thing a consumer should look /ask for before engaging the services of any broker is their FSB License Number.

It is a means of protecting the financial security of your family in the event of your death, illness or injury. Life insurance also reduces the burden on your family by helping to meet any financial obligations that you may leave behind. These obligations could include business debt or outstanding bond, credit card and vehicle payments.

Taking out a life insurance policy, therefore, isn’t a question of “should I?”, but rather “when should I?” and “how much should I take out?”

The insurance premium is the amount that you need to pay to sustain your policy’s cover. Most premiums are payable monthly in advance.

A death benefit is the amount that you are covered for in your policy and which will be paid out in the event of your death. If I take life insurance now, am I covered tomorrow? / Immediately whether applying for life insurance over the phone via a call centre, online or on your Cellphone, cover is instantaneous on receipt of your completed application and the first premium payment. Be aware that in terms of the Consumer Protection Act, you are entitled to a “cooling off” period of 30 days, during which time you may cancel the life insurance policy with limited or no penalty.

Premiums which are guaranteed for a period and then either have capped or uncapped increases.

Insurance companies reserve the right to change the terms and conditions on a policy, however there are a few principles that apply:

If the general terms and conditions are changed in any way, this would apply to all policies and not one specific policy; In such an instance, an insurer must notify its’ customers of this change and its impact;  If a customer’s risk changes, for example if they started smoking, an insurer may re-assess the premiums and terms and conditions of cover on an individual basis. This assessment is done with the customer’s knowledge.

An insurance agent may be employed directly by an insurance company or may be an independent contractor. If independent, an agent typically contracts with a limited number of insurance companies and sells policies issued only by those companies. Some agents (known as exclusive agents) may even contract with only one company. The main disadvantage of using an agent is that you'll probably have fewer options to choose from. The upside is that a good agent will be totally familiar with the companies and policies he or she deals with. Plus, some companies may employ only agents to sell their products. The two major types of agents are property/casualty agents and life/health agents.

An insurance broker is completely independent. Instead of being tied to one or a handful of insurance companies, a broker can work with many different companies and sell their products. This means that a broker can offer you a much wider range of choices than an agent, and a good one will thoroughly shop the market for you. Plus, since a broker has no company allegiance, he or she represents you (the client) directly. However, a broker may lack the detailed knowledge of companies and policies that many agents have. A broker typically specializes in one or more types of insurance and may sometimes work with other professionals to arrange appropriate coverage for you.

A good medical aid does not reduce the need for dread disease cover and vice versa. Each type of cover addresses a very different need.
The purpose of medical aid is to cover actual medical costs associated with illness, including a dread disease. Your medical aid should foot the bill or at least part thereof for hospitalisation, medical procedures, medication and doctor’s consultations.

Dread disease cover will compliment your medical aid by providing a lump sum which can be used to cover any additional costs associated with your change of lifestyle as a result of suffering from a dread disease. On average as little as 30% of costs associated with suffering from a dread disease will be medical bills. The remainder of the costs typically includes modifications to your car and home, hiring a caregiver, alternative treatments and medications not covered by your medical aid and rehabilitation therapy. Dread disease cover can help in this regard.

For example, hospital treatment for a heart attack may be covered by medical aid, but after surviving the heart attack, one may not be able to climb the stairs in a multi-storey home and so the installation of a mechanical lift may be required - this could be covered by your dread disease cover.

Dread disease cover is a long-term insurance policy that provides a lump sum pay out in the event of you contracting a dread disease like cancer. It can be used to help fund any additional expenses that arise from contracting the disease (e.g. medical expenses).

This type of cover mustn’t be confused with medical aid. Medical aid covers specific expenses incurred (i.e. hospital expenses) whilst dread disease insurance pays out a lump sum benefit depending on the severity of the illness. The payout has no relation to the expenses you’ve incurred during your illness.

Life cover is a long term insurance policy that pays out a cash lump sum to your nominated beneficiary in the event of your death. If you have a partner or family who depends on your regular income, you need to be sure they would cope financially if you were no longer around. One must remember that your family members would still have to find money to cover the monthly costs of living should you die prematurely. Life cover is also used to pay off any remaining debt such as a mortgage if you were to pass away.

Some companies have a funeral benefit built into the life insurance policy, which pays within 48 hours to provide for some of the policy holder’s immediate needs.

Your first point of contact if you have a complaint about your insurance policy is to approach your insurer. If they are not able to assist you with your complaint, or you do not get resolution, you can contact the Long-term Insurance Ombudsman or the FAIS Ombudsman (where applicable).

The Long-term Insurance Ombudsman (www.ombud.co.za) will act as a mediator between the insured person and the insurance company. The FAIS Ombudsman (www.faisombud.co.za) will investigate complaints against an insurance company, for example, the way a policy was sold or how a service was provided.

For each company we represent it’s different but, you can contact us and we will assist you with the claim process.

One of the functions of an Insurance Broker is to ensure that your premiums are competitive. As most insurers rely on brokers to maintain the relationship and act on behalf of the insured, in most cases, dealing directly with the insurer will in fact cost the client more as there is no one acting in their interests with regard to, inter alia, pecuniary matters.

Always be aware of the terms and conditions of your life insurance policy. Pay particular attention to the waiting periods that may apply and also to the situations where you would not be covered. Important: You should also be aware whether your policy covers you for natural and accidental death. When getting life insurance, look for companies with simple, understandable contractual terms – preferably those with a readability stamp on their contracts.

Both life and disability coverage are fundamental to your long-term financial plan. There is no hard and fast way to say which is more important, because each couple's situation is different.