30 April 2021
RISK
Now, more than ever, it’s essential to get clients income protection that matches their needs BY SCHALK MALAN CEO, BrightRock
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f 2020 taught us anything, it’s that life can change drastically over a short space of time, and when it does, we need to adapt to that change. This is also true when it comes to insurance. Clients’ needs will change over time – that’s why it’s important for you to get them cover that can precisely match their needs at the start of the policy, and can then change with them as their needs change. As you know, a client’s most important asset is their ability to earn an income. It’s critical that they protect their income through efficient income protection cover that can protect their future pay cheques. Temporary disability vs permanent disability With income protection, you should consider both temporary and permanent disability cover that protects
your clients’ pay cheques should they suffer an illness or injury that interrupts their income stream for either a short period or until they would have expected to stop working and actively earn a salary. Temporary disability cover protects against the financial impact of less severe, higher-frequency events, like fracturing a bone, while permanent disability caters to severe, less frequent events, like losing a hand or being diagnosed with stage four cancer. How income protection fits into your client’s financial plan If a client suffers a disability, income protection is critical to their financial wellbeing and that of their family. If their income is fully protected in the event of a temporary or permanent disability, it means that a pay-out will see to it that they can meet all their current financial obligations. With an income that’s comprehensively covered, clients will still be able to pay for medical aid, children’s school fees, fund their retirement, continue paying their bond and other debt instalments, and maintain their standard of living. It’s an essential mechanism that holistically supports a person’s financial plan as it makes sure that their other financial goals will still be on track. Closing the income protection gap South Africans are underinsured, especially when it
Sheldon Shaw: Making his mark
“If a client suffers a disability, income protection is critical to their financial wellbeing and that of their family” comes to income protection. At BrightRock, we believe in helping clients close this gap by enabling advisers to structure their clients’ policies appropriately from the start, thereby giving them cover that can match their needs exactly. This avoids unnecessary waste and helps the client buy as much cover as is needed when they need it most – which is right now. We also believe it’s important to offer clients flexibility when it comes to their pay-outs. For example, if a client chooses lump-sum cover for their permanent expense needs with BrightRock, they can change this choice to a recurring pay-out at the claim stage, or to a combination of a lump sum and an ongoing monthly income when they have insight into how their condition will impact them. With the appropriate cover, it’s possible for clients to close the gap and get more comprehensive coverage for their income.
Sheldon Shaw, Tattoo Artist
Tattoo artist Sheldon Shaw explains the impact of his profession on the lives of others and why he needs income protection to continue making his mark. BY ELMARIE SAMUEL Product Marketing Specialist, FMI (a Division of Bidvest Life Ltd)
could help change their lives for the better.” Sheldon on the impact he makes: “My dream day is to give someone what they want and to make them happy. Tattoos help people get through tough times, or they show a story. I always want to make a positive impact, and with tattoos I get to do that every single day for the rest of my life.” Sheldon on his income: “The income I have gives me the freedom to do whatever I want to do. And that’s why I work so hard – so that I’m able to enjoy the things that I’m passionate about.”
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heldon’s FREE HUGS tattoo says it all. He is a people’s person and loves his job. “It’s a fun, free environment that I really enjoy,” he says. “I like meeting new people and interacting with them. And that was probably the biggest draw card for me into this profession – to do something that involved people and to do something that
Sheldon on life insurance: “It’s super important for anyone who works on commission to have cover that protects them if they get sick or injured. Because if I can’t work, I don’t make money. I am responsible for looking after my dependants. Why should it fall onto someone else if something happens to me? And I think that’s one of the biggest reasons why people should have income protection.”
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What cover can someone like Sheldon get? There are two points to consider: Firstly, the waiting period: FMI recognises that commission earners, like tattoo artists, lose income from day one of being unable to work. With our Event Based Income benefit, most claims will be paid from day one. Secondly, sensitivity to claim: Occupations such as tattoo artists are so sensitive to claim that they are typically unable to take out income protection. For example, a minor finger injury which wouldn’t affect working in a more traditional occupation, could result in someone like Sheldon being unable to work for a few weeks.
This means that these individuals may often be unable to protect themselves against any injury or illness, which includes the events that they’re not at increased risk of suffering. At FMI, we have a different view. We believe everyone needs to protect their income. That’s why we developed our Event Based product to help provide cover for those occupations that would traditionally not be covered. Instead of providing these individuals with cover for an injury or illness that prevents them from working in their occupation, each occupation gets cover for a predefined list of injuries and illnesses. This means that tattoo artists like Sheldon can now qualify for income protection. To watch Sheldon’s inspiring story, go to www.fmi.co.za/impacters
