In tough economic times, people are sometimes left scrambling for cash to meet everyday expenses and lifestyle demands. Your insurance investments are a possible source of funds to meet your financial needs.
You may either opt for early withdrawal or surrender. Surrendering an insurance policy means exiting from the insurance policy before the maturity. It is the voluntary termination of the insurance contract by the policyholder.
It is however important to remember the purpose of insurance investments. The most relevant ones are:
• Long-term savings for retirement – financial consequences of a longer-than-expected life (longevity).
• Protection against financial consequences of early death, disability.
What does it mean to surrender an insurance policy or cash in your insurance investment before they mature?
There are certainly some consequences to using insurance investment plans to meet immediate cash needs, especially if you’re compromising your long-term goals or your family’s financial future.
Here is what you must consider before deciding to prematurely terminate or surrender your insurance investment plans:
• Surrender charges;
• Inability to obtain coverage or the same amount of coverage at the same price;
• Loss of guaranteed interest rate;
• Loss of additional savings benefits as opportunity costs of surrender.
If you are in doubt or need more information about the risks or consequences of early withdrawal or cancellation, please contact your Financial Advisor or NAMFISA.
NAMFISA Complaints Department: (061) 290 5000 (main) or 290 5133 (Ms Marina K. Ishidhimba) or 290 5207 (Ms Hilka
Alberto), Fax: (061) 290 5122; for online complaints email complaints@namfisa.com.na; visit www.namfisa.com.na or visit
us on the: 6th Floor, Alexander Forbes House, 154 Independence Avenue, Windhoek.
* NAMFISA treats all information obtained from the public with confidentiality.
Issued by:
Phillip N. Shiimi
REGISTRAR: LONG- AND SHORT-TERM INSURANCE