A “respectable send-off” is non-negotiable for most families and cultures. It represents more than a farewell; it is a final expression of respect, a celebration of a life lived, and a meaningful tribute of appreciation
It is therefore not surprising that funeral cover remains the most purchased insurance product in the country. Millions of South Africans rely on it to ensure that, at the very least, the immediate costs associated with death do not become an added burden for grieving families.
The role of corporate in funeral cover
Over time, funeral cover has also become a standard feature of employer-sponsored group risk benefits, often offered alongside life and disability cover. These benefits play an important role in supporting employees and their families during difficult times. However, an increasingly visible gap is emerging between the cost of funerals in South Africa and the level of cover typically provided by companies to their employees.
Funeral costs usually consist of multiple components including caskets, venue hire, catering, transportation, burial or cremation costs, and tombstones. These cost can cause expenses to rise exponentially.
In many cases, funerals in South Africa now cost at least R25,000, and can easily extend into the hundreds of thousands of rand depending on cultural expectations, family size, and location.
Despite this reality, it is still common for employer-provided funeral cover to remain as low as R10,000. This amount is not nearly sufficient to cover the cost of a funeral and its associated expenses, leaving families to bear not only the emotional burden of loss but also significant financial strain.
The consequences of this gap are significant. Many employees, even those with funeral cover through their employers, are forced to seek alternative funding sources at short notice, with some resorting to unplanned borrowing.
Many others are compelled to purchase high-cost funeral policies in the retail market, covering themselves and their families at premium rates significantly higher than those that could be offered through adequate group cover. Affordability pressures contribute to extremely high lapse rates for these products, leaving policyholders with minimal or no benefit despite having spent thousands of rands on premiums.
The help needed when it matters most
High funeral costs are not limited to higher-income households. Claims experience at Kaelo Life indicates that funerals costing in excess of R40,000 have been observed among individuals earning less than R10,000 per month. And this cost excludes additional expenses such as catering and transportation.
This highlights the extent to which funeral expenses can place significant financial pressure on families across all income levels.
Products like Kaelo Group Funeral effectively address the gap, enabling employers to provide employees and their families dignity during times of loss, at very low cost. By offering funeral cover amounts that are adequate, regularly reviewed, and adjusted in line with actual funeral costs, employers can help ensure that employees are supported when they need it most. This not only provides financial relief in difficult times but also contributes to cultivating a workforce that is stable, engaged, and productive over the long term.
A dignified way forward
In a country where funerals carry deep social and cultural importance, ensuring that funeral cover reflects lived reality is not only practical, it is essential. Corporate leaders should seek solutions that safeguard the well-being of their employees, which in turn, protects and strengthens the resilience of their businesses.
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