How a Discovery Life Policy Works

    When you start planning your life for yourself and your family there’s a lot to think about: a house, the things that make a house a home, a car or two that will suit you all, good schools for the kids. It seems unimaginable that there is more to add to the list, but planning your life means keeping every possibility in mind, including the risk that something unexpected could prevent you from providing for your family. The Discovery Life Policy Plan is there to support your family’s plan.

    But rather than simply being life insurance the Discovery Life Plan is a collection of customisable benefits that cover the full range of life risks. Unlike traditional life cover it offers you access to your funds in the case of real need. All collective benefits are covered by a single premium and can be personalised according to your needs and means.

    Discovery Life Policy Structure

    There are several benefits built into your Discovery Life policy including:

    Income Continuation Benefit – to protect your income if disability prevents you from earning a salary

    Severe Illness Benefit – a lump sum payout to aid you in instances of severe illness, like cancer

    Capital Disability Benefit – a lump sum payout to aid you if you become permanently disabled

    Global Education Protector – to cover the education costs for your children in the event of your death, severe illness or disability

    Think of a Discovery Life policy as your family’s portfolio of lifetime defences. You choose exactly what and how much you put in.

    Discovery Life Policy Life Fund

    The way you choose to structure your life plan will determine the overall value. Discovery calls this the Life Fund and this fund is the source from which any claims are paid. In the event of your death the full value of the Life Fund is paid out.

    Example of a Discovery Life Policy

    Let’s say for instance that you have structured your life plan into three sections:  you choose 50% of your Life Fund to go to a Capital Disability Benefit and 25% to go towards the Severe Illness Benefit. The balance of 25% goes to life cover.

    If your Life Fund is valued at R4 million, for instance,  then the Capital Disability payout would be R2 million. For Severe Illness you would be covered for R1 million. For Life Cover you would be covered for the full R4 million.

    So what would actually happen for any claim other than death? Well, using this example, should you have an accident and be permanently disabled you would need to claim the full value of your Capital Disability Benefit. The amount of R2 million would be paid out in cash the Life Fund would be reduced to R2 million, of which 100% is for Life Cover, 25 % for Severe Illness and you would still have 50% for any future disabilities.

    If, however, you want to make sure that claims don’t impact the overall value of your Life Fund you can choose a Minimum Protected Fund. This allows you to establish a minimum overall value or level of cover.

    If you chose a minimum of R3 million in this case, your Life Fund would never fall below this minimum protected level, no matter how many benefit payments have been made, or what the value of the payments were. With this option, even if you claim your Life Plan would always bounce back to its minimum protected level.

    But how do you guarantee that your cover remains sufficient for the future? To ensure that your cover stays relative to the cost of living you can also choose to have your benefits increased every year in line with inflation or at a fixed percentage.

    The Discovery Life Policy Plan has been designed to give you all the cover you need at the price you can afford. It is a flexible, personal solution to suit your individual circumstances.