Times are tough! The prices of necessities such as fuel, food and electricity are suffocating our already thin wallets. It’s a scramble and every cent counts. It’s no longer about choosing between wants and needs. Basic needs are fiercely competing against each other for our limited resources. What do we do and how do we survive this onslaught?
It is easy for one to think that we can do without certain expenses such as insurance. It may seem like a good idea to cut them off, but what happens if an unfortunate event happens, thus compounding your already dire financial situation. Perhaps a better question to ask is; how can I save and make my money stretch while keeping my insurance? The good news is you can save money and still have insurance, plus the peace of mind that comes with it.
Underinsurance is a major problem in South Africa. The Financial Sector Conduct Authority’s (FCSA) 2022 Financial Sector Outlook Study shows that only 10% of South Africans have life insurance, 11% have physical asset insurance and 8% have health insurance.
These numbers are concerning but they don’t tell the full story. Is it that it’s unaffordable or that we don’t see the value of insurance? It could also be that we are not fully informed on the benefits of having insurance.
Reasons why you should not cancel your insurance;
- You lose out on all the benefits and getting a new one will be more expensive (higher premium)
- If you cancel it and something goes wrong, it could make your financial situation worse
- You compromise your family’s security (if you pass on, your debts won’t disappear)
- You cannot put a price on peace of mind
With insurance, you can;
- Replace valuable items that you otherwise wouldn’t be able to without it
- Protect your family against unplanned expenses (e.g. life or funeral cover helps cushion the difficulty of a bereavement so it doesn’t double up into financial stress)
- Use the payout to pay off a bond, pay for education, clear debt, or even create income sources (it can help bring financial freedom to your family)
- Protect your business against various forms of disaster that could ruin it
- Protect your biggest asset, your health, as out of pocket medical care is costly
Many people see insurance as a grudge purchase but it can be affordable. If you’re a breadwinner for instance, you probably take your responsibility to take care of your loved ones seriously. Moreover, you’ll want to continue taking care of them even after a drastic change in circumstances leads to you not being able to anymore. A sensible thing to do is to resist the temptation to cancel your insurance.
What to do if your budget is stretched
Go back to the drawing board and pay close attention to every expense on your budget list. Reassess, reprioritise and reallocate funds where necessary. Shop around, compare insurance premiums and look for ones that best serve your needs. You could also call your insurer and find out how you can reduce your premium without losing your core cover. You could consider downgrading instead of cancelling your entire cover. Having some cover is far better than having none, should the worst happen.
With the squeeze on our household budgets not likely to ease up anytime soon, you’d do well to scrutinise your expenses. VodaSure has some great competitively priced insurance products that can help you save. From funeral, to life, device, security as well as medical emergency and health cover. VodaSure is fast becoming a one-stop shop for some of our everyday insurance needs. This is in line with its quest to ensure that more people gain access to these products and services.
“We are passionate about financial inclusion and want to make sure that no one is left behind. This is what inspires the development of our products. Through our digital platforms such as the VodaPay app, we aim to make it easier for people to access insurance. Ultimately we want people to feel secure and have a better quality of life,” says Managing Executive Head of Insurance, Jacques Du Preez.
“People shouldn’t have to choose between saving money and getting the best insurance products. Everyone should be able to do both,” adds Du Preez.
