GREENLIGHT. Celebrate Life. greenlight

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1 GREENLIGHT Celebrate Life greenlight

2 Why GREENLIGHT is right for you. We can provide cover for your entire family, from newborns to adult dependants. We can protect your income in the event of disabling events and severe illness throughout your life. We pay what we promise, no excuses! 97% of all our assessed claims are paid. By using plain language we ensure your understanding and peace of mind. We underwrite thoroughly and carefully analyse risk, in order to price accurately. greenlight All our benefits are priced for life. Our past premium reviews at the end of the guaranteed periods speak for themselves, with premiums having remained unchanged. GREENLIGHT understands how important it is to take care of life s precious things. We make sure that you are protected against serious losses, so that you are comfortably able to put into practice Greenlight s philosophy to Celebrate Life. GREENLIGHT insures the life in your years, which means that we help you to take care of the things you have to do, so you can get on with the things you want to do.

3 Life is not measured by the number of breaths we take, but by the moments that take our breath away Understanding GREENLIGHT risk cover GREENLIGHT is a modern innovative product and can offer you so much more than a payout for your dependants if you die. It goes far beyond what many people still think of as life insurance Much more importantly, GREENLIGHT will also pay out if you live! If you have experienced a traumatic event such as a heart attack, or cancer - or a disabling accident, GREENLIGHT can replace your income if you can t work, and help you make the necessary lifestyle changes.

4 GREENLIGHT What is the CORE NEED of risk cover? Life is precious. At the start it s a fight for survival, but as we grow in age and understanding, the reality of life s fragility creates an even stronger determination to protect against its risks at all costs. We become more resolved to make every breath we take meaningful and to celebrate every breathtaking moment. GREENLIGHT insures not the years in your life, but, as Abraham Lincoln so succinctly said, the life in your years. None of us knows how long our journey will last, or what s in store for us, but with GREENLIGHT you ll have the peace of mind that you have provided protection for yourself and those you love. This brochure will give you an overview of the risk cover provided by GREENLIGHT and help you decide which benefit really suits your lifestyle and needs. What makes GREENLIGHT different? GREENLIGHT is unique in that the benefits of each building block work together to offer a flexible risk solution that s become one of the most highly regarded in the market. The benefit options available with GREENLIGHT are as follows: Building Your Personal Plan Building Block 1 GREENLIGHT Life Building Block 2 GREENLIGHT Earning Ability Building Block 3 GREENLIGHT Lifestyle Adjustment Building Block 4 GREENLIGHT Future Needs Building Block 5 GREENLIGHT Business

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6 Building Block 1 GREENLIGHT Life This is the foundation of your Personal Plan. It offers three different benefit options to choose from: Death A cash payout that is generally used to settle debt, outstanding bonds, estate duty and other financial costs in the event of death. It can also be invested to provide an income and financial security for your family. Accidental Death Sudden accidents can wreak financial disaster at a time when money should be the last thing on your mind. This benefit will pay out a lump sum to a beneficiary of your choice in the event of your accidental death. Final Expenses Provides readily available cash to cover final expenses, such as travel, the funeral and clearing immediate debts, for example credit cards. Why GREENLIGHT is right for you? You can get immediate cover for up to 30 days before your first premium. Our Death also includes built-in terminal Illness cover. Life

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8 Building Block 2 GREENLIGHT Earning Ability This cover is designed to protect your income should you be prevented from working or become physically or functionally impaired. It offers six different benefit options: LUMP SUM: Functional Impairment To provide lump sum cover if you suffer a permanent and irreversible functional impairment due to illness or injury. This covers an extensive list of functional impairments, with specified percentage payouts depending on the severity of the impairment. Term cover or whole-life cover may be selected. Comprehensive Disability Provides protection should you be permanently unable to work, or if you suffer a permanent and irreversible functional impairment due to an illness or injury. You will receive 100% of your cover amount with a claim, but no partial payouts for less severe impairments. You have a choice of protecting your Own occupation, or Own or Reasonable occupation. Term cover or whole-life cover may be selected. Extensive Disability Congenital birth defect and impairment cover for your children are included. Whole life cover can provide protection for frailty. Extensive Disability This is GREENLIGHT s market-leading lump-sum disability cover. Provides protection should you be permanently unable to work, or if you suffer a permanent and irreversible functional impairment due to an illness or injury (partial payments for less severe impairments are included). Congenital birth defect and impairment cover is also included for your children. Extensive Disability : You have a choice of protecting your Own occupation, or Own or Reasonable occupation. Term cover or whole-life cover may be selected. Earning Ability

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10 Building Block 2 GREENLIGHT Earning Ability INCOME: Disability Income Provides a monthly income while you are occupationally disabled or functionally impaired, either temporarily or permanently. The disability or impairment should last longer than the elected waiting period. A partial benefit may be payable if you are partially disabled or impaired. Payments for specified periods on fractures are included as well as a maternity benefit equivalent to four months premiums. Term cover or whole-life cover may be selected. Temporary Income Provides a monthly income while you are occupationally disabled or functionally impaired on a temporary basis only. The disability or impairment should last longer than the elected waiting period. A partial benefit may be payable if you are partially disabled or impaired. Payments for specified periods on fractures are included. A total benefit of either 24 or 48 months of income can be selected. Term cover or whole-life cover may be selected. Functional Impairment Income Provides a monthly income while you are functionally impaired due to an illness or injury. This benefit is payable on temporary or permanent functional impairment, if the impairment lasts longer than the elected waiting period. A partial benefit may be payable if you are partially impaired. Payments for specified periods on fractures are included as well as a maternity benefit equivalent to four months premiums. Term cover or whole-life cover may be selected. The Disability Income provides an exact match to the duration of the impairment or occupational disability. It pays until recovery, retirement or until death for the whole life option. Earning Ability

11 You have the following disability needs. Lump Sum Insure 100% of your monthly income,or your bond,modifications to your car and house and other once off expenses related to disability. Income Insure 100% of your monthly income, on temporary and/or permanent basis. Temporary (recovery) Permanent (no recovery) Why GREENLIGHT is right for you? of up to 100% of earnings is available. can last up to age 70 or whole life. Functional Impairment events do not change after retirement. Congenital Birth Defect and Impairment cover for children is included in Extensive Disability up to the lower of 10% of the parent s cover, or R500,000. Catch-all definition includes Activities of Daily Living and Instrumental Activities of Daily Living, and provides cover for frailty in old age.

12 Building Block 3 GREENLIGHT Lifestyle Adjustment Illness or injury can leave you profoundly vulnerable and recovery is often long and difficult. This cover is expressly designed to make life easier when you need help the most to give you independence. Within this building block there are three benefit options: Severe Illness This benefit pays out 100% in the event of an illness such as a heart attack, cancer or stroke, as defined in your contract, to ensure that you have the best possible chance of recovery. It offers a choice of Core, Comprehensive or Extensive Illness. Term cover or whole-life cover may be selected. Physical Impairment A lump sum is paid out in the event of you suffering a physical impairment. It will cover any lifestyle adjustment expenses such as buying a wheelchair, building ramps or prostheses. Retrenchment This pays up to six months income to give you the opportunity to find a new job and sort out your finances. Why GREENLIGHT is right for you? Our Severe Illness provides you with 100% cover at all times. This means that where another company may pay you only 25% of your cover on a mild heart attack (according to standard industry definitions), we take into account the full lifestyle impact of your condition and pay out 100% to ensure that you have the means to change your lifestyle for the better. Lifestyle

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14 Building Block 4 GREENLIGHT Future Needs Protecting your Personal Plan is vitally important, so to help you, GREENLIGHT offers three options: Premium Protection Waives the premium on the protected benefit, its accelerators (if applicable), and the Premium Protection premium on the death or disability of the life covered. Future Use your current state of health to secure the option to apply for cover in the future, with reduced underwriting requirements at the time. Savings Provides the choice of a focused or flexible savings vehicle to achieve your savings goals. Why GREENLIGHT is right for you? GREENLIGHT Future Needs can be optioned every three years or at the time of specific life events such as marriage, the birth of a child, or buying a house. You don t lose it if you don t use it. Future Needs

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16 Building Block 5 GREENLIGHT for Business GREENLIGHT for Business offers comprehensive business assurance solutions that protect business owners against a variety of business risks, including: Keyperson This provides funds to help overcome the negative financial impact caused by the death or disability of a key person. Buy and Sell Allows co-owners to take out cover on each other s lives, which in turn enables them to buy a deceased or disabled coowner s share in the business. Business Contingency By providing the necessary backup funds, this benefit allows the business to take out cover on the life of an individual who stands surety for debts. Business Overheads Replacer This will provide monthly repayments for a limited period if you are unable to work as a result of illness or injury, and maintain your business overhead costs. Why GREENLIGHT is right for you? Our legal team can assist with succession planning as well as buy and sell agreements for your business. You can also get comprehensive disability cover for business owners and keypersons. for Business

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18 GREENLIGHT CARE 4U A person covered under a stand-alone GREENLIGHT benefit has unlimited access to GREENLIGHT CARE 4U, a revolutionary support programme, which offers 24-hour assistance, advice and support for clients and their loved ones. Simply dial for: 1. Access to legal assistance GREENLIGHT CARE 4U will put you in touch with a panel of legal experts who will consult with you on any general legal issue, including: Winding up an estate Interpreting a will Divorce The purchase and sale of a property Employment, labour law & industrial relations Tax 2. Help with children and schooling We will also give you access to standard legal documentation, including: Small Claims Court Kit Maintenance Kit Domestic Workers Agreement Will Template Get access to advice and assistance relating to children, including: Advice on the protection of children in their school environment Interventions to protect a child s rights Legal assistance with childcare, adoption and paternity disputes 3. Death and bereavement Support No one can ever be prepared for the life-changing experience of a death in the family, so GREENLIGHT CARE 4U offers support through expert advice, practical arrangements and counselling care 4u GREENLIGHT CARE 4U Simply dial Risk-related services These include: A joining fee waiver and a 50% subscription rebate at Virgin Active BMW and AA advanced driving course discounts Trellidor and Maxidor product discounts Savings at a variety of vehicle tracking service providers

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20 Key questions regarding Disa Why GREENLIGHT Disability cover is important? Your most valuable asset during your working career is your ability to earn an income. It needs to be protected. Your income enables you to maintain your lifestyle - the home you live in, the type of education your children receive, your retirement provision, access to medical treatment, the car you drive, and your emergency savings. An unexpected illness or accident can prevent you from working, and depending on your occupation, you and your family may be left with a reduced income or no income at all. There may also be additional costs related to the illness or accident, which may not be covered by your medical aid. For instance, specialist treatment and rehabilitation is often not fully funded by your medical aid. Will your emergency savings be able to cover these? Disability cover can also help to keep your retirement planning on track by replacing 100% of your income while you are disabled. This enables you to continue your retirement savings. Tax deductible premiums on income disability benefits also put money back into your pocket. As medicine advances, people are living longer than ever before, and the risk of frailty is on the increase. The cost of nursing homes and frailty care is significant. Can these additional costs be funded by your retirement income? How can I protect my family s income? Whether your household budget is small or large, you should identify areas of waste or overspending. Once you are comfortable with your budgeting for the necessities, you know how much is left to put away for emergencies and savings. But creating a budget requires an income. With GREENLIGHT, you can protect your income, and your ability to budget, against the impact of death, disability or illness on your ability to provide for your family.

21 bility Your budget can be divided into the following categories: Total Income 35,000 Taxes 10,500 Net Spendable 24,500 Bond/Rent 7,000 Rates & Taxes, Electricity, Water 1,500 Medical 1,500 Short Term Insurance (Car, House) 800 Life, Disability, Illness cover 700 Clothing 1,000 Other Regular Accounts (HP s) 500 Fuel, Transport & Parking 2,000 Entertainment 1,000 Food 4,000 Monthly Expense Indicator Investment Savings 1,000 School/Childcare 2,500 Other Expenses 1,000 Total Budget 24,500 Disability triggers: Accident (car, home or at work) Short-term illness or condition (fractures, operation) Long-term illness or impairment (paralysis, heart condition) Protection of whole budget that is affected by disability triggers: % with a Disability Income, or % with a Temporary Income combined with a Comprehensive/ Extensive Disability lump sum benefit

22 Solutions for th Does GREENLIGHT offer solutions for the entire family? With GREENLIGHT Personal, you can cover your entire family for disabling events. From newborns to adult dependants can now have disability cover through GREENLIGHT. Full spectrum of Disability cover Bread Winner(s) Functional Impairment Income/Lump Sum Functional Impairment Income/Lump Sum Functional Impairment Income/Lump Sum Scholars 14+ years and Students Adult Dependants Children up to 13 years My Family Newborn Home Executive Congenital Birth Defects Child Impairment

23 e Family At birth Congenital birth defects (Extensive) Disability GREENLIGHT offers solutions for the whole family and can also cover you throughout your lifetime. Up to 13 years 14 years to student to starting a career Working career Child impairment (Extensive) Disability Functional impairment lump sum and/or income Full spectrum of disability cover available Retirement to frailty Functional impairment lump sum and/or income

24 KEY FACT: With GREENLIGHT, you can insure 100% of your income for temporary AND permanent disability until a retirement age of 70 or earlier. You also have options for cover after retirement (see Why do I need Disability cover after retirement?) How much disability cover is enough? The traditional advice is that you need disability cover until your retirement savings can take over. So if you have a retirement date in mind (between age 55 to 70), you need to insure 100% of your monthly income (increasing with inflation every year) up until retirement. You need to ensure that you are covered for temporary and permanent illnesses or conditions. You need to ensure that when taking out lump sum cover for permanent disabilities, your cover amount equates to an appropriate multiple of your annual earnings (see How large should my lump sum benefit be until retirement?) How large should my lump sum benefit be until retirement? You need to insure 100% of your average monthly earnings, increasing at the rate of inflation, e.g. R30,000 per month growing at CPI, until your planned retirement age. Calculate how long you have until your planned retirement (planned retirement age less current age) Using the table below, simply look up your nearest number of years to retirement, and you will find a reasonable multiple of your annual earnings that could provide you with 100% of your income until your planned retirement date. As you get closer to retirement, the multiple of earnings required reduces, as can be seen from the table. multiples should therefore be reviewed with your advisor or broker. These multiples are dependent on the economic assumptions used Retirement Multiple of Annual Salary Years to retirement

25 Assumptions: Expected inflation of 5% into the future, and expected investment returns, on the lump sum claims payout that is reinvested, of 8% after costs (Inflation plus 3%). Old Mutual does not provide any guarantee that the selected cover as a multiple of annual earnings will provide an income until retirement. Example: A 50-year old woman, planning to retire at age 70, has 20 years to retirement. She will need lump sum cover of around 15 times her current annual income, which can be invested and used to draw an income until retirement if she becomes disabled. Why do I need Disability cover after retirement? You may need additional funding to provide for frailty care. You may need an enhancement to your retirement income if you become impaired after retirement. These funds can be used to upgrade your home or car, or pay for additional expenses as a result of the impairment. If you are just getting by with your current retirement income, additional expenses due to poor health may very well stretch you financially. KEY FACT: With GREENLIGHT, you can insure your income up to R50,000 for temporary AND permanent impairments after retirement, or up to a R6 million lump sum for permanent impairments after retirement.

26 How likely are you to become frail after retirement? May 3, 2011 The prevalence of frailty, which is linked to earlier death, increases throughout adulthood and not just after age 65 years, according to results from the Canadian National Population Health Survey reported online April 26 in the Canadian Medical Association Journal. The prevalence of frailty increases with age in older adults, but frailty is largely unreported for younger adults, where its associated risk is less clear, - Kenneth Rockwood, MD, Dalhousie University and the Centre for Health Care of the Elderly in Halifax, Nova Scotia, and colleagues. With advancing age, the prevalence of frailty increased from 2.0% (95% confidence interval [CI], 1.7% - 2.4%) for participants younger than 30 years, to 22.4% (95% CI, 19.0% %) for those older than 65. For participants who were at least 85, the prevalence of frailty was 43.7% (95% CI, 37.1% %). How much does frail care cost in 2012? Fragile Frailty is defined as: Easily broken; mentally or physically fragile; not firm or durable; weak; infirm. Province Facility Gauteng Resthill elderly care (Leazonia) R9400 Western Cape Napier Retirement Village R6900 Kwazulu Natal Homeleigh Haven Durban R6800 North West Samaul Broadbent Potchefstroom R6050 Per Month - Starting/Sharing

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28 What do the Old Mutual claims statistics tell us? Old Mutual paid out R2.6 billion in risk cover in 2011 alone. 97% of all assessed claims were paid across death, disability and illness cover. Old Mutual claims paid in 2011 Death claims Paid 99.6% 99.5% 99.6% 99.3% 99.4% Declined 0.4% 0.5% 0.4% 0.7% 0.6% REASONS DEATH CLAIMS WERE DECLINED Suicide (within first 2 years of the policy or if a suicide exclusion applies to the product) 77% Exclusion clause applied 17% Non-disclosure / fraud 6% CAUSES OF DEATH CLAIMS Accidental death 24% Cancers and tumours 19% Cardiovascular (Heart) disease 18% Respiratory system 10% Endocrine and metabolic system 7% Brain, spinal or nervous system 6% Suicide 5% Crime and violence 5% CAUSES OF ACCIDENTAL DEATH CLAIMS Motor vehicle accident 66% Crime and violence 22% Drowning 4% Shot 3% Other or unspecified 2% Major burns 1% Accidental poisoning 1% Explosion 1% Gastrointestinal system and abdomen 4% Other or unspecified 3%

29 Old Mutual claims paid in 2011 Disability claims Lump sum Income Paid 80.2% 82.7% 82.8% 82.3% 84.7% 94.8% Declined 19.8% 17.3% 17.2% 17.7% 15.3% 5.2% CAUSES OF DISABILITY CLAIMS Lump sum Income Bones, joints and connective tissue 20% 33% Cardiovascular system 19% 1% Brain, spinal and nervous system 19% 23% Psychiatric states 11% 2% Cancer and Tumours 11% 18% Respiratory system 7% 2% REASONS DISABILITY CLAIMS WERE DECLINED Lump sum Income Not totally and permanently disabled 46% 18% Non-disclosure 35% 35% Claimant still working 14% 0% Exclusion clause applies 3% 18% Other reasons 2% 29% Other or unspecified 5% 3% Ear, nose, throat and eyes 4% 1% Urinary system 1% 1% Motor vehicle accidents and other accidents 1% 9% Gastrointestinal system and abdomen 1% 3% Endocrine and metabolic system 0% 3% Old Mutual claims paid in 2011 Illness claims Claims Statistics: So as you can see, the claims statistics in this brochure are transparent using assessed claims on the GREENLIGHT, Flexi and Conventional product ranges between 2003 and Paid 86.8% 85.4% 79.0% 80.5% 78.7% Declined 13.2% 14.6% 21.0% 19.5% 21.3% CAUSES OF ILLNESS CLAIMS Cancer 57% REASONS ILLNESS CLAIMS WERE DECLINED Claim does not meet definition in contract 68% Event not listed in contract 16% Non-disclosure 14% Exclusion clause applies 2% Heart Attack 19% Other 9% Coronary Artery Bypass Graft 8% Stroke 5% Open-heart surgery 2% We have used the agreed industry standard in calculating our claims payout ratios for This means that invalid claims were excluded from our claims payout ratios (e.g. where no benefit existed, or where the benefit has lapsed). The industry standard is a change from the way that the 2010 figures were calculated.

30 Life Stages You need to consider that providing for your needs can never be exact. As your future unfolds, your needs will change. Some commonly used guidelines to help you are: Consider your life cover first in order to provide your dependants with financial security and to settle debt. Now look at disability cover protecting your income for you and your family. Severe illnesses strike suddenly and they strike hard. So illness cover is a very high-ranking priority as well. Once you ve thought through these main areas, add on complementary cover, such as premium protection, in order to complete a comprehensive Personal Plan that suits you and is flexible and affordable. Here is an overview of some ordinary people at different stages in their lives. Each of their situations and needs is unique. Let s have a look at what they would ideally need to secure the life in their years (for more information on the benefits mentioned, refer back to the building blocks under What makes GREENLIGHT different? ). Life stages

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32 Housewife..or Househusband Jana Williams is a 34-year-old housewife who has three children and a husband who is working hard to establish a career. Jana also brings in a little extra income by selling jewellery from home. If something happened to stop Jana from working in the home, the family would need immediate help in terms of childcare, shopping and household management. If she was sick (even for a little while) they simply wouldn t be able to cope. If she died, her husband would need permanent live-in childcare as well as domestic help as he would have to work even harder to compensate for the loss of income. Jana needs: Jana has the easy GREENLIGHT CARE 4U number in her purse for emergencies. Life Death Final Expenses Earning Ability Functional Impairment, or Functional Impairment Income Lifestyle Adjustment Severe Illness (Comprehensive) Future Needs Future s (Core) Young and Single Steve Thompson is a 25-year-old marketing graduate who lives alone and works for one of the big retail stores. He rents the home he lives in and does a lot of business travelling, plays sport, and gets away for a break every chance he gets. Steve is completely reliant on his income. If he can t work, he can t play and even more importantly, wouldn t be able to support himself. Steve needs: In addition, as Steve is away often, he can call GREENLIGHT CARE 4U to link up to ADT. Life Final Expenses Earning Ability Temporary Income, plus Comprehensive Disability Lifestyle Adjustment Severe Illness (Core) Retrenchment Future Needs Future (Comprehensive)

33 Partnered/Married - no children Pumie and Sipho are a young couple who both work as teachers. They are getting married soon and hope to buy a home. As Pumie and Sipho are busy making future plans the input of a good financial planner is critical. They have many goals and need to separate them into shortterm, medium-term and long-term. They also need to draw up a marriage contract. Pumie and Sipho need: In addition, they can call GREENLIGHT CARE 4U to connect with a legal adviser to assist in drawing up their marriage contract. Life Death Final Expenses David and Tanita need: Earning Ability Temporary Income plus Comprehensive Disability (Own) Lifestyle Adjustment Severe Illness Future Needs Premium Protection Future s Married/Partnered with children own business David and Tanita April are married and have two children aged ten and seven. Tanita works as a secretary and David has his own hardware store (Tanita helps David with his admin work in the evenings). With children to educate and a family to support, as well as a business to run, these two have their hands full and can t afford any personal or business risks. They are doing their best to reduce debt and to pay off their home. In addition, as David s vehicle is essential to his business, they can call GREENLIGHT CARE 4U to find out more about Tracker vehicle tracking. Life Death Accidental Death Final Expenses Earning Ability Disability Income, or Temporary Income plus Extensive Disability (Own) Lifestyle Adjustment Extensive Illness Future Needs Premium Protection Future s Business Business Contingency Business Overheads Replacer

34 Married/Partnered no children in the house Alan Jones and Sharmila Singh are in their late forties and are both previously divorced. They each have grown up children who are no longer dependent. They both work and are at the peak of their careers and are earning a good income. They are paying a joint bond. Alan and Sharmila have commitments to extended families but are putting any spare cash into bulking up their retirement planning with hopes of a year-long round-the-world trip. Alan and Sharmila need: As they are also looking at buying a second home to produce additional income, Alan and Sharmila can call GREENLIGHT CARE 4U for legal advice around a lease agreement. Life Death Final Expenses Earning Ability Comprehensive Disability Lifestyle Adjustment Retired Partnered or living alone Extensive Illness Future Needs Premium Protection Marita van Wyk and Helene Brown are friends and neighbours. Both are widowed and both have retired. They are planning to sell their houses and pool their resources by purchasing a shared home for cash. Marita and Helene need Most importantly they need to contact GREENLIGHT CARE 4U to link up with security experts to make their new home as safe as possible. Life Final Expenses Earning Ability Functional Impairment (Whole Life) Lifestyle Adjustment Extensive Illness (Whole Life) (Note they don t have any life cover).

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36 Take action, what to do next What is the VALUE OF ADVICE? When it comes to life and disability cover, South Africans are generally underinsured. Most of us require more than double our current life cover. And, on average, we need about 70% more disability cover. (Reference: ASISA Gap Studies see website for more information) SPEAK to your FINANCIAL ADVISER/BROKER Your financial adviser/broker will provide expertise and guidance on how to implement the perfect GREENLIGHT Personal and/or Business Plan, and how much cover should be in place for your particular needs. Visit or contact 0860 WISDOM ( ) root360/om