How to Get Your Debt Paid During COVID-19 in South Africa
Before we start, I know what you are thinking, this is “how to make money advice” or “get rich quick scheme” during Coronavirus, it’s not that. We are going to share some findings with you because we genuinely feel like South Africans deserve to know that they have options and there may be some help you never knew you could get.
Things have been tough recently with the Coronavirus and SA’s National lockdown, we realize many people are losing their jobs as businesses are struggling to keep their heads above water. So we did some investigation to see how South Africans can get some help and relieve some of the financial stress you may be under.
Have you ever heard of Credit Life Insurance? Most consumers haven’t as this insurance is always built into your personal loan, mortgage, student loan, credit card etc. Lenders are generally required to include credit life insurance in your loan or credit policy even if you never knew it was there. Seems strange to have cover that you don’t know anything about, right?
What is Credit Life Insurance and What Does it Cover?
The simple and straightforward answer: Credit Life Insurance helps you pay your debt from your credit provider in the event of
– Disability or
– In the event, you are unable to earn an income such as RETRENCHMENT.
The Credit Life Insurance provider will take care of your debt obligations generally for up to 11/12 months. The payout and timelines depend on your credit life insurance policy.
Now, there may be exclusions and fine print in the credit life policy where for example the provider has a waiting period to pay out but every credit life provider has their own policy wording just like car insurance.
Credit Life with Clientelle
As Clientele says in the statement below taken from the Clientele website, there is a waiting period from the time the policy is taken out.
“Do I need to go through a new waiting period? Not necessarily. The waiting period is usually calculated from the date of commencement of our policy. However, if you had another active policy with similar benefits in the past 90 days, the waiting period will be determined from the commencement of that policy. “Clientele website
Credit Life with Capitec
As you can see Capitec has a 3 month waiting period for payouts due to retrenchments:
Death – full outstanding amount
Permanent disability – full outstanding amount
Temporary disability – a maximum of 12 instalments
Unemployment, the inability to earn an income or retrenchment – full outstanding balance(3-month waiting period for retrenchment and termination of employment)”Capitec website
What We Suggest:
- Contact your lender or Credit Life Insurance Provider immediately and ask them to send you the policy documents for your credit life policy and have a look through the fine print to make sure there are no exclusions that apply to you being paid out on behalf of your loan.
- Then call or email your bank if you don’t find any exclusions that apply to you and ask them how the payout works for credit life insurance of your loan and what the next steps are.
** Please make sure you specifically mention your credit life insurance policy.
Check out this video by Maya on Money, she explains Credit Life Insurance perfectly and how it can help you during Covid-19:
Please share this with a fellow South African, it could make all the difference. Let’s stand together and help each other where we can.