The easy thing would be to say that, because of all the publicity and so forth, the easiest thing would be to pay the client. But I think it would be the wrong thing to do. It’s more difficult, I can tell you now, not to pay that client.— Hillie Meyer, CEO of MMI
No, we will not pay out. We need to stick to our policy. We need to protect the integrity of our industry.— Hillie Meyer, CEO of MMI
Momentum Life on Tuesday bowed to immense public pressure, creating a special dispensation for the victims of violent crime.
It is clear from market reaction over the last two days, the company said in a press release, that under certain circumstances, current industry practice creates the impression that insurers are looking for reasons not to pay a claim.
Momentum is in the business of paying claims, it said, and has therefore taken the criticism to heart.
The insurer has created a solution that will pay an amount equal to the death benefit (limited to a maximum of R3 million) in the case of violent crime, regardless of previous medical history.
The "solution" will apply to all existing as well as future life cover clients.
Key points to take note of:
This pay-out will be fully funded from Momentum’s profits and not from clients’ premiums;
The guarantee will pay out when the death was a direct result of violent crime, even when material medical non-disclosure impacts the legitimacy of the contract;
The pay-out is not in addition to the ordinary death benefit. It only applies in circumstances when the death benefit will not be payable or has been reduced;
- Momentum reserves the right to reject any fraudulent claims.
The guarantee will apply immediately to all Momentum's life cover clients and will be applied retrospectively.
The company is identifying clients who were impacted in this way and will contact their families, including Denise Ganas, to arrange payment.
Momentum says that except for the new guarantee, full disclosure remains non-negotiable.
Listen to the interview in the audio below (and/or scroll down for quotes from it).
It’s not a material amount… we can offer this peace of mind… it’s an important message we’d like to send that we do care…— Johann le Roux, Momentum Life
The principle of disclosure… is still very important.— Johann le Roux, Momentum Life
This is a start for us… it’s an important matter to address. There’s only so much we can do in two days… The matter of violent crime is a real issue in South Africa…— Johann le Roux, Momentum Life
This is not a policy benefit… it’s a permanent, sustainable solution.— Johann le Roux, Momentum Life
There isn’t a proper understanding of how the industry works… we need to do more work…— Johann le Roux, Momentum Life
We’re not changing our policy practices… We created a solution that lives outside the main policy domain…— Johann le Roux, Momentum Life
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