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% 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, and other factors that could affect their premium or coverage.
Disclosing uncomfortable information doesn't necessarily mean the insurer will turn down the application. Instead, it helps them price the risk accurately. Depending on the information disclosed, the insurer may request medical records, add a loading, or apply an exclusion for a specific condition. In most cases, coverage is not refused outright.
The critical window for disclosure is during the underwriting phase, before the policy starts. Policyholders must disclose all relevant information up to that date. If they later increase their coverage or add a benefit, they will need to disclose any relevant changes since their last application, but this only affects the new portion of coverage.
If non-disclosure is found at the claim stage, the insurer can investigate and take action. In some cases, the policy may be voided, and no claim is paid. In less severe cases, the insurer may adjust the premium, exclusions, or benefits retrospectively to reflect what should have applied. This can still affect the payout.
To protect their claims, policyholders can take practical steps. Firstly, they should disclose all relevant information, even if they are unsure about its materiality. Secondly, they should take their time when applying and provide complete, accurate answers. Finally, they should read their policy documents carefully and query any discrepancies with their insurer or adviser.
According to Friedlander, most claims are paid, and non-disclosure is one of the few causes that policyholders can control. If policyholders are unsure about what needs to be disclosed, they can consult with a Discovery-accredited financial adviser. By taking these steps, policyholders can ensure a smooth claims process and avoid potential disputes with their insurer.
Key points
- Non-disclosure accounts for 0.4% of declined life insurance claims at Discovery Life.
- Policyholders must disclose all relevant information during the underwriting phase.
- Taking practical steps such as disclosing all relevant information and reading policy documents carefully can protect policyholders' claims.
