South Africa’s Social Grant Beneficiaries Pay R143 Million Monthly to Two Insurance Giants for Funeral Policies
By Nexio News
Two of South Africa’s largest insurance providers, Clientèle Life and Sanlam, along with their subsidiaries, collect a staggering R143.33 million every month in funeral policy premiums directly deducted from social grants. The payments come from nearly one million pensioners and disability grant recipients, raising concerns about transparency and consent in the industry.
The Big Players Dominate
According to data revealed by Social Development Minister Nokuzola Sisisi Tolashe in March 2025, these two corporate groups account for 87% of all funeral policy deductions from South African Social Security Agency (SASSA) grants. In total, more than R165 million is deducted monthly from 1.11 million beneficiaries, with the vast majority flowing to just a handful of insurers.
The figures were disclosed in response to a parliamentary question from Democratic Alliance (DA) MP Bridget Masango, who sought clarity on how insurance companies access grant payments. Under the Social Assistance Act, registered insurers can apply to deduct premiums directly from SASSA payouts before funds reach beneficiaries’ bank accounts.
Pensioners Report Unauthorized Deductions
The issue gained attention last September when reports by GroundUp and Limpopo Mirror revealed that hundreds of elderly grant recipients had money taken from their accounts without their knowledge. Deductions ranged between R100 and R280 per month—a significant portion for those relying on state support.
When SASSA investigated six cases, it confirmed the beneficiaries had policies with 1Life or Emerald Life, both now part of the Clientèle group. While the affected pensioners were reimbursed, insurers maintained they had valid consent, leaving questions about how these policies were sold.
How the Money Flows
Of the 30 insurers authorized to deduct premiums, just a few dominate the market:
- Emerald Life leads with R40.92 million monthly from 241,178 pensioners, averaging R169.67 per policy.
- Assupol Life follows with 291,821 policyholders paying R135.70 each.
- 1Life Insurance ranks third, serving 166,636 beneficiaries.
For disability grant recipients, Emerald Life again tops the list, collecting R9.06 million from 50,397 people. Assupol and 1Life take in R5.57 million and R3.72 million, respectively.
Corporate Consolidation Raises Concerns
The market is more concentrated than it appears. Clientèle acquired 1Life in July 2024 and Emerald Life later that year, a move approved by the Competition Tribunal in February 2025. Similarly, Sanlam bought Assupol in October 2024, expanding its reach in low-income insurance.
This consolidation means that despite multiple brand names, most premiums ultimately flow to two corporate giants. Clientèle-linked companies now collect over half of all deductions, while Sanlam’s subsidiaries—including Assupol and Safrican—account for the rest.
SASSA’s Safeguards Under Scrutiny
Masango pressed the minister on whether SASSA has taken action against insurers for mis-selling. Tolashe responded that while “robust systems” are in place, SASSA can only intervene if companies violate the Social Assistance Act or Financial Sector Conduct Authority (FSCA) rules.
To prevent fraud, beneficiaries must undergo biometric verification, including facial or fingerprint checks against Home Affairs records. A “liveness test” ensures the policyholder is physically present during sign-up. Agents caught in misconduct are blocked industry-wide, and beneficiaries can report unauthorized deductions via SMS or at SASSA offices.
Yet critics argue more oversight is needed. “Every complaint triggers an insurer-led investigation,” Tolashe said. If wrongdoing is found, policies are canceled, and refunds issued. But with no public record of punitive actions, questions linger about enforcement.
A Lifeline or a Burden?
Funeral insurance provides crucial coverage in a country where burial costs can devastate families. However, with monthly grants already stretched thin, the line between protection and exploitation remains blurred.
For now, nearly a million of South Africa’s most vulnerable citizens continue paying millions to a handful of insurers—raising the question: Who truly benefits?
— Reported by Nexio News
