A lot of people are scammed by unregistered funeral service providers. To ensure that you don’t fall prey, we spoke to Prudence Thepi, general manager at Old Mutual and the Financial Sector Conduct Authority (FSCA) on how you can avoid funeral insurance scams.

1. Ensure you have funeral cover from a reputable company

According to Thepi, checking whether your insurer is reputable is as important as checking the cost of the funeral cover. She says you also need to check the overall benefits of the various options before deciding.

2. Check that you are dealing with reliable sales people

Fraudsters sometimes pretend to be employed by known financial services providers. Thepi says you need to confirm the credentials of the person selling you funeral insurance. Also make sure that they are registered with the company they claim to be representing by contacting the FSCA or the financial services provider directly.

“Make sure that you know exactly which financial services company is carrying the risk on your policy and paying the claims,” she says.

3. Do your research before you sign up

Thepi advises that you ask to see the policy information that the financial service provider is obliged to disclose.

“Do not agree to anything you don’t understand. A reputable insurer will be transparent and provide all the relevant details, as well as the terms and conditions,” she warns.

She says it is vital for you to understand the entire policy, otherwise your family members could run into trouble when they want to claim.

The FSCA adds that you must check for any exclusions and ask for the constitution as well.

4. Don’t hand over cash to people offering you funeral cover

Thepi says that one of the red flags to look out for when you apply for funeral cover is when a provider requests a cash payment. A legitimate financial services provider will usually collect premiums via debit order or a stop order. This ensures that all interactions are recorded, to give you access to all interactions for future reference.

The FSCA advises that you also record your policy number as this will help when investigating your case.

5. Store your documents in a safe place

Once you have chosen a funeral insurance provider Thepi suggests that you let your family and loved ones know about your funeral insurance and where you have stored the documents, should anything happen to you.

To find out if a company or person is allowed to sell you funeral cover, call the Financial Sector Conduct Authority (FSCA) on 080 020 2087.

 

This article has been prepared for information purposes only and it does not constitute legal, financial, or medical advice. The publication, journalist, and companies or individuals providing commentary cannot be held liable in any way. Readers are advised to seek legal, financial, or medical advice where appropriate.