When you want to make ad hoc increases to your insurance cover, you typically have to undergo underwriting so that your insurer can reassess your risk.
This means you have to answer questions about your health and undergo tests which could mean a higher premium or an exclusion on the new cover.
Increasingly, insurers are offering "future insurability" benefits allowing you to: buy more life, disability and critical illness cover, extend your cover, and freeze and reinstate your cover - without being subject to underwriting or providing a declaration of health.
But not all insurers' future insurability benefits are alike, and some still insist on an HIV test when they underwrite you for the additional cover.
With most risk policies, you have to agree to an annual cover increase that applies on the anniversary of your policy. These increases aren't subject to underwriting. But ad hoc increases in cover most likely will be.
You can suspend an annual increase or cancel future increases, but typically should you later decide to reinstate the annual increases, you will have to be underwritten.
Check with your insurer what will happen should you wish to alter your cover.
Pension Funds Act
Two newer assurers, FMI and BrightRock, let you increase your cover without underwriting, even if you've had a claim and have a loading or an exclusion on your policy, and this will not cost you an additional premium.
Elmarie Samuel, FMI's product specialist, says FMI lets you increase your cover without underwriting or an HIV test even if you do not have an annual benefit increase.
Schalk Malan, CEO of BrightRock, says all BrightRock policyholders can double their initial cover without underwriting at any time up until the maximum age for taking out cover.
As a Liberty policyholder who qualifies for an Offer of Additional Cover you can increase most of your lump-sum cover within 24 months of being underwritten, but you must declare that there have been no changes to your health since your policy was issued, says Henk Meintjes, the head of risk products at Liberty.
Those Liberty policyholders with the Future Income Assessment facility can make changes to their disability income protection annually without underwriting or a statement of good health, Meintjes says. But only if you don't have any health loadings, haven't claimed in the past 12 months, haven't reached the policy anniversary preceding your 55th birthday and have an automatic benefit increase on the policy.
Beyond agreed annual increases, Sanlam policyholders can increase their income protection without underwriting by up to twice the inflation rate, or 20%.
Sanlam policyholders with the Future Cover benefit can increase lump-sum benefits up to 25% at each occurrence of certain life events, such as marriage or birth of a child, without underwriting. Any other increases will be subject to underwriting, says Petrie Marx, a risk product actuary at Sanlam.
Dirk Claassens, a product development specialist at Momentum Myriad, says any ad hoc increases to cover which exceed the annual benefit increase are subject to underwriting unless you have the paid-for Future Cover benefit, providing cover increases for specific life events. With Momentum, you have to take an HIV test when you increase your cover.
On an FMI policy, you can increase your cover by up to 25% in the event of marriage, divorce, childbirth, adoption, death of a spouse or the purchase of a property. The increase applies to each event. This benefit is part of the cover and comes at no extra cost.
Malan says BrightRock has no predetermined limits per life event - you can choose any increase at any time with no underwriting up to twice your initial cover.
Discovery clients can take out the Future Fund Benefit for an additional premium. Gareth Friedlander, the head of research and development at Discovery Life, says that under this benefit you can, without evidence of health and insurability, increase your cover, within limits, in the event of marriage, the birth or adoption of a child, an increase in your bond cover and an increase in your interest in a partnership.
"In certain cases, a health declaration may be required or full underwriting may be called for," Friedlander says.
On certain life events, you may also be able to increase your lump-sum disability and income protection cover with no underwriting, depending on your Vitality status and state of health.
Extend the term
Since we're living longer, many of us will need to work for longer. Samuel says FMI allows you to extend your cover up to the age of 70, provided you make a declaration of health.
Malan says BrightRock allows you to redirect your premiums to new cover when your needs change, whenever you need to and without underwriting.
Friedlander says Discovery Life's Income Continuation Benefit automatically allows you to claim an income when you are unable to do your job up to the age of 70. The policy benefit then converts to a Long-Term Care Benefit, which will pay out if a disability impairs your daily activities.
Meintjes says Liberty's Lifestyle Protector also offers disability cover (lump sum and income) and critical illness benefits for the whole of your life. You select this benefit either at inception or when you make changes to your policy, but this is subject to underwriting.
If you choose cover for a specified term, such as up to your retirement age of 65, you may qualify to extend your cover without underwriting at the end of that term, or if certain life events occur, he says.
Marx says Sanlam does not offer an extension-of-cover option, but you can extend sickness and disability income benefits to age 70, subject to underwriting. The term for your lump-sum disability benefits must be selected upfront.
Freeze your cover
FMI offers a freeze benefit which allows you to freeze your cover and premiums for three or six months. The benefit comes at no extra cost.
When the freeze benefit period lapses, premiums are reinstated without underwriting or a declaration of health. The benefit, which could prove useful if you are retrenched or fall on hard times, can be used only once and after the policy has been in place for at least a year.
Discovery allows you to reinstate a policy within 24 months of it lapsing on nonpayment.
A declaration of health or underwriting may apply.
Liberty allows you to reduce your benefits and premiums on a Lifestyle Protector policy for up to six months.
Thereafter, you can increase your benefits to what they were prior to the reduction (or a lesser amount) without underwriting...