Some families are turning life insurance policies into a money-making scheme at the cost of someone’s life. These policies are meant to provide financial security to families when a loved one dies. According to the recent Insurance Crime Bureau report, this is becoming a trend.
Garth De Klerk, Insurance Crime Bureau CEO, stated that the plot often includes individuals unlawfully taking out policies in the name of victims and subsequently murdering them to gain from the payouts.
“It is economically driven, times are really tough. People are prepared to kill for financial benefit,” De Klerk said.
“To evaluate how widespread the crime is, would be difficult. However, efforts to restrain these crimes are ongoing. There are hundreds of incidents that we are investigating. Because of the investment of the insurance industry, we can detect, investigate, prosecute, and successfully convict individuals,” De Klerk explained.
One of the known Insurance payout fraud cases is Rosemary Ndlovu’s. Ndlovu has been found guilty of a series of murders linked to insurance payouts. The victims include witness Madala Homu, who was killed in March 2012, after which R131 000 was cashed in from insurance policies. In 2013, Ndlovu’s sister Audrey Ndlovu was murdered, with R717 000 allegedly paid out from insurance policies. Her boyfriend, Morris Mabasa, was also killed, and R416 000 was cashed in. Ndlovu’s niece Zanele Motha died in June 2016, with R120 000 received from an insurance policy. Other victims include Mayeni Mashaba, who died in 2017, and Mashego, who was murdered in January 2018.
Denise Gabriels from the National Financial Ombud Scheme, explained the reality that having a family relation with someone does not stop them from becoming a target.
“Recent cases have shown that family interest is not enough to protect one against these violent crimes. More needs to be done than just requiring that insurance interest between the policyholder and the beneficiary,” she said.
Gabriels stressed the need to ensure that people protect their personal information closely. This includes their ID number, but also to check with insurers if there are any covers taken out for them without their knowledge.
