One of the key challenges with conventional funeral cover is that it assumes steady disposable income – something the majority of South Africans simply do not have. If a policyholder falls behind on payments, the policy can lapse, leaving them without cover and exposed to financial vulnerability, not to mention being forced to restart waiting periods if they take out a new policy.
This is why Digisure Long-Term Insurance (LTI), a digital insurance business within the Sanlam Fintech cluster, has launched a first-of-its-kind prepaid funeral cover product designed to make insurance more accessible to more South Africans.
“The concept mirrors the way many people already buy airtime, data or electricity – on a prepaid, pay-as-you-go basis – instead of committing to long-term contracts,” explains Edwin Theron, head of Digisure LTI. “In the same way, clients can now purchase funeral cover upfront for three, six or 12 months, depending on what they can afford at the time.”
This flexibility, Theron explains, gives policyholders greater control: “We know that many people want funeral cover but forego it because they worry about missing a debit order and losing everything. With prepaid, they can lock in cover when they have money – whether after a good month of earnings or when expenses are lower – without the risk of restarting waiting periods.”
Needs-based, not more of the same
South Africans are, on average, underinsured. Yet many households are arguably overinsured when it comes to funeral cover. Importantly, the prepaid model is not designed to replace existing products, but rather to give more clients accessibility.
“What we want to do is better understand clients’ real needs and design products that are specific and relevant, rather than simply pushing more of the same,” says Theron. “Insurance at its core offers a valuable social good – people pool resources so those facing unexpected events can access support. This is about extending that social good to people who may previously have been excluded because of their financial position and irregular earning patterns.”
Technology-led, scalable distribution
Digisure LTI, which owns its own technology stack, is structured to integrate seamlessly with partner platforms and extend products into the ecosystems where people already transact. Underwritten by Sanlam Developing Markets (SDM), the prepaid funeral cover will initially be distributed through ambassadors (the same agents who sell airtime and data in retail environments) and a digital journey integrated into the Blue Label ecosystem. Clients can purchase a voucher, activate it when they want cover to begin, and extend it as their circumstances allow.
Theron explains that, over time, and as clients get accustomed to the concept, this distribution will likely move from physical stores to a greater proportion online: “Our long-term goal is for the majority of sales to be made fully digital, so that clients can buy cover directly, in the same way they top up data or electricity. By integrating with platforms where people are already transacting, we make insurance relevant, convenient and trustworthy.”
Expanding access to financial security
While traditional funeral policies with predictable debit orders will remain attractive to many, Theron stresses that this new approach is about inclusion, not competition.
“This product launch is not about replacing existing funeral policies but about experimenting with new ways to serve a specific segment of previously excluded clients,” he explains. “It won’t appeal to everyone, but for those living with fluctuating incomes, it offers dignity, peace of mind and a real pathway into long-term financial protection. And that’s what inclusion is about – meeting people where they are.”
Concluding on this is Tshepo Mogotsi, head of communications at Sanlam Fintech, who says, “As a cluster within the Sanlam Group, we are committed to developing innovative, digitally led solutions. At the heart of everything we do is a desire to enable South Africans to live with confidence and make financial inclusion a reality. We’re proud to be trialling this concept and look forward to the market’s response, knowing the significance that the final send-off a funeral holds to many”.
