Couples and insurance

In SA, women aren’t exempt from the impact of financial inequality and could be affected even further if they share finances and insurance policies with their live-in partner.

This is unless they proactively put binding agreements in place. Women should take simple steps to reduce their financial risk in the event of a breakup.

It starts with a frank conversation about shared financial responsibilities and insurance cover.

It’s vital for couples to know what protections are offered by their insurance policies. This is particularly relevant for couples opting to cohabitate rather than get married.

Having a conversation about shared finances is particularly important for women who aren’t sole breadwinners, as they tend to be at greater financial risk – largely as a result of inequality in the workplace, and the role many women play at home. In SA, the gender pay gap is estimated at around 15% to 17%.

Being a stay-at-home parent or scaling back on work commitments to spend more time with the children will also impact a person’s income.

Whoever the stay-at-home parent is, is likely to work and earn less. For this reason, they should seriously consider entering into what’s called a “cohabitation agreement” with their partners to cover the eventualities of what might happen should the relationship end.

How insurance policies are managed should ideally be covered in the cohabitation agreement. This is to avoid finding yourself in a situation where the policy has been terminated without consultation.

For example, you might assume your partner has continued to pay a life insurance policy, or a disability policy, when in fact, cover has been cancelled. Should any insurable event occur, you might be very surprised to discover that your financial position has been compromised.

The same applies to other forms of insurance, including household and motor vehicle insurance.

Nagtegaal is executive head of Hippo.co.za