What to Consider Before Buying Life Insurance in SA

Choosing between life insurance policies can feel overwhelming, especially when every insurer claims to offer the “best” cover at the “best” price. But there are a few things that many South Africans consider before they commit to a life insurance policy.

According to the 2025 ASISA Life and Disability Insurance Gap Study, South Africa’s 16.1 million formally employed income earners collectively have enough life and disability cover to replace only 39% of the income their families would need if they passed away or became disabled. Many South Africans are covered, but they do not have sufficient cover in place to support the financial needs of their families when they are no longer there.

This guide walks you through what to look at, beyond just the monthly premium, so you can choose the right policy for financially protecting the people who depend on you.

Here’s what to consider:

1. What are Your Family’s Financial Needs?

It’s tempting to evaluate a life cover policy purely on monthly premiums, but the real question is whether the cover amount is enough to protect your family. A lower premium attached to inadequate cover doesn’t close your insurance gap. Take your family’s circumstances into account and work out your family’s financial needs (outstanding debt, income replacement, education costs) and start with the end goal in mind. Ask yourself: How much cover do I need? Then consider if the monthly premiums fit into your budget.

2. Check How the Life Insurance Provider Is Regulated

Life insurers operating in South Africa must be licensed by the Prudential Authority. Before comparing benefits, confirm the life insurance provider is properly licensed.

3. Read Online Reviews with a Critical Eye

Beyond the numbers and the fine print, it can also help to see what existing policyholders are saying. Online reviews and ratings platforms can offer a general sense of the provider’s service levels, claims experience, and communication.  That said, reviews are one data point among many, not a substitute for doing your own research. Treat them as a starting point for questions to ask, rather than a final verdict: look for consistency across multiple independent platforms. One of the popular review platforms in South Africa is Hello Peter.

4. Understand Waiting Periods and Exclusions

Every life cover policy has fine print. Ask about waiting periods (how long before certain benefits kick in), exclusions (conditions or causes of death not covered), and whether pre-existing conditions affect eligibility.

At AllLife we believe that everyone deserves cover – even if you have a pre-existing condition. If you are living with HIV or diabetes, you can get up to R10 million in life cover at AllLife. We have also arranged for emergency medical services that you can use the moment your policy becomes active:

• 24/7 Medical Helpline when you cannot get to a medical facility.
• Private ambulance services, when you need it most.

5. Will the Life Insurance Claim be Paid Out?

There is a misconception that life insurance claims are not paid out by insurers. Industry-wide data from ASISA shows that life insurers settled 94.1% of death claims across individual life, credit life, funeral, and universal life policies in 2025, paying out R44.2 billion in benefits. ASISA notes this payout rate has remained steady between 94% and 96% for the past five years.

It is true that in some instances claims are denied because the terms and conditions of the policy have not been met. Make sure that you understand the life policy terms and that your premiums are up to date.

 6. Review Policy Flexibility

Can you increase cover as your circumstances change (marriage, children, a new bond)? Can you add dependants or adjust beneficiaries easily? South Africans can hold multiple life insurance policies simultaneously, so flexibility to top up cover as your needs grow is worth factoring in rather than assuming one policy has to do everything forever.

Key Takeaway

Comparing life insurance policies in South Africa isn’t just about finding the lowest premium — it’s about matching real cover to your family’s real needs, from a properly regulated insurer with a track record of paying claims. Take the time to compare on substance, not just price.

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Sources

• FA News: ASISA Article, “Life insurers settled 94.1% of all death claims in 2025“, Published, 10 June 2026
• Association for Savings and Investment South Africa (ASISA): Media Release, “Assets managed by SA life insurers exceed R5 trillion for the first time“, Published, 31 March 2026

Statistics current as of the 2025 ASISA Life and Disability Insurance Gap Study and 2025/2026 ASISA long-term insurance statistics.

This article is for informational purposes only and does not constitute financial advice. Readers should consider their individual financial needs and circumstances before taking out any financial product.

AllLife (Pty) Ltd is an Authorised Financial Services Provider, FSP No 4946. Products insured by Old Mutual Alternative Risk Transfer Limited (OMART Life).