Having your insurance payments deducted from you payslip is always very convenient, but there could be hidden savings opportunities which you are not even aware of.
by: Ziyaad Mia
Payslip deductions make life easier for consumers, helping them avoid the high debit order charges and the consequences of forgetting to do an EFT (electronic fund transfer) to cover the insurance payments. Payslip deductions may seem like the obvious choice and makes it easier to honour payment agreements, but they tend to have a nasty way of “biting” into our monthly budgets when we least expect it.
Agreeing to have these deductions on our payslips means that they get paid on time without fail, but often these deductions for insurance go unnoticed, causing consumers to spend unnecessary amounts on duplicate insurance policies or products.
This is often the case for South African government employees where they have multiple policies for the exact same cover. They are losing out on the opportunity of having additional funds that can be allocated more purposefully in their monthly budgets and possibly be put towards a savings account or investment. Often consumers do not scrutinise their payslip thoroughly enough which can cause insurance products to amount to hundreds and possibly thousands of rands affecting their net salaries. This can have a major effect on consumers who are battling to afford their living expenses every month.
Insurance products are often marketed to companies and departments of the government. When certain products are referred to staff by their employees, staff may automatically think they need the product without doing proper research into what insurance products they already have and what these products cover in particular.
It is always advisable to speak to more than one adviser as this will give the consumer a better idea of the particulars of the products and what exactly they will be covered for., By properly informing themselves, consumers will be in a better position to make decisions based on their particular needs and avoid paying duplicate insurance products, saving them money every month and freeing up cash flow.
Consumers should seek more than one opinion when it comes to insurance products especially if they are being opted to be taken from their payslips, allowing crucial funds to go undetected.
The SmartInsure team gladly assist our clients to understand this, and to ensure they have access to every extra rand available which could be allocated towards savings for dependents or even a retirement plan.