In South Africa, life insurance claims can be declined due to non-disclosure, which refers to leaving out material facts when applying for or updating a policy. According to Gareth Friedlander, Deputy CEO of Discovery Life, non-disclosure accounts for a small but significant proportion of declined claims. In 2025, Discovery Life paid 99.3% of all claims, totaling R9.1 billion, with 0.4% being declined due to non-disclosure at the underwriting stage.
Non-disclosure can be intentional or unintentional, and it doesn't have to be a deliberate attempt to deceive. It can occur when policyholders don't realize a particular detail is relevant to their application. Insurers typically want to know about past or current medical conditions, mental health history, lifestyle habits, financial situation, risky hobbies or sports, occupation, and other life cover held or applied for.
The critical window for disclosure is during the underwriting phase, before the policy starts. Policyholders must disclose all relevant information up to that date to avoid any issues with their claim. If they later increase their cover or add a benefit, they will need to disclose any relevant changes since their last application, but this only affects the new portion of cover.
If an insurer suspects non-disclosure, they can investigate, and sometimes only once a claim comes in. In one case, a policyholder had not disclosed a serious alcohol-related health issue and a prior hormonal condition. Medical records obtained after death revealed a different story than what was disclosed at application, resulting in the policy being voided and no claim being paid.
To avoid non-disclosure and ensure a smooth claim process, policyholders can take practical steps. Firstly, they should disclose all relevant information, even if they are unsure if it's material. Secondly, they should take their time when applying and provide complete and accurate answers. Finally, they should read their policy documents properly and query anything that looks off with their insurer or adviser.
According to Friedlander, most claims are paid, and non-disclosure is one of the few causes that's entirely within a policyholder's control to avoid. If policyholders are unsure what needs disclosing on their own policy, a Discovery accredited financial adviser can help them go through it properly.
By being thorough and transparent when applying for life insurance, policyholders can ensure that their claims are processed smoothly and efficiently. This can provide them with peace of mind, knowing that their loved ones will be protected in the event of their passing.
Key points
- Non-disclosure accounts for 0.4% of declined life insurance claims in South Africa.
- Policyholders must disclose all relevant information during the underwriting phase to avoid non-disclosure.
- Taking practical steps such as disclosing all relevant information, taking time when applying, and reading policy documents properly can help prevent non-disclosure.
