HIV positive South Africans are living long and fruitful lives due to the massive rollout of antiretrovirals, a fact Old Mutual did not foresee during the 1990s when they first introduced policies aimed at them.
Old Mutual now plans to pay over to its customers some of the reserves it has built up in its funeral policies.
South Africans are living longer
The life expectancy of a South African male at birth improved from 51 years in 2005 to 56 in 2014 while that of women improved from 56 in 2005 to 62 in 2014, according to the Actuarial Society of South Africa.
Statistics SA estimates male life expectancy at 59.1 years while females at birth are expected to live 63.1 years, on average.
A 15-year-old has a 30 percent chance of dying before the age of 60, according to Old Mutual, while a 40-year-old is now 15 percent less likely to die before the age of 60 than before the advent of antiretrovirals.
How much money are they releasing?
Michael Goemans, Finance Head at Old Mutual’s Mass Foundation Business, estimates there are about R600-million in reserve, ready to be released.
Goemans says Old Mutual will share the windfall by reducing premiums to new funeral policy customers and by improving cover to existing policy holders without them having to pay more for it.
Old Mutual expects 320 000 of their existing customers to benefit.
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