Answer:
Recently the the Life Offices? Association (LOA) announced that its member life offices will no longer apply existing HIV/Aids exclusions to life and disability policies. This follows a best practice recommendation by the LOA to its member offices to waive existing HIV/Aids exclusions for all lump sum death and disability benefit claims submitted from 1 April, 2007.

As a result, going forward, no claim for a lump sum death or disability benefit will be denied by any of these life companies based on the HIV/Aids status of the insured person, unless the policyholder is found guilty of material non-disclosure.

Gerhard Joubert, CEO of the LOA, says even though the best practice recommendation is not binding, all LOA member offices have agreed to waive the exclusions.

Waiving exclusions

The waiving of exclusions does not apply to:

• Income protector policies and hospital cash plans;
• Policies requiring regular HIV retesting;
• Cases where policyholders committed material non-disclosure. This is particularly relevant to low premium policies like funeral policies that often rely on disclosure rather than HIV testing.

Joubert says after doing away with HIV/Aids exclusion clauses for policies issued after 1 January, 2005, LOA member offices also scrapped HIV/Aids specific waiting periods for new business as from 1 June, 2006.

Dr Pieter Coetzer, convenor of the LOA?s Medical and Underwriting Committee, says over the past decade, vast improvements have taken place in the treatment of HIV/Aids.

"Initially, there was no treatment for HIV and the disease was therefore not insurable. Now, provided there is full compliance with ART (anti-retroviral treatment) prescriptions, HIV/Aids is considered a chronic treatable disease like diabetes and many other chronic diseases and is therefore insurable."

Diabetes an example

Dr Coetzer says although most existing cover options remain fairly expensive, some life insurers are in the process of developing new generation products that will offer competitive premiums for HIV positive people on an ART programme. He says the history of diabetes is a good example of how cover becomes available and cheaper as sustainable treatment options are introduced and insurers gain a better understanding of a disease.

Insurance companies employ some of the brightest minds in the country. Actuaries work out the risk reward/ratios of every product that hits the market. So you can be sure that the methodologies used to structure these products are sound and will not put the organisation at risk.

So your policy will live up to its promises, at least in terms of the lump sum death benefit. If you have an investment portion attached to the life cover, it should me closely watched so you can be sure that the returns are beating inflation.