1Life Survey Shows Financial Strain On Households As Insurance Remains Key To Family Protection

Source: Supplied. Hayley Parry, money coach and facilitator at 1Life’s Truth About Money.

Higher living costs and income-tax bracket creep are shrinking paychecks, threatening South Africa’s financial stability, placing particular strain on the lower to middle-income classes and highlighting the urgent need for smarter and strategic wealth-building approaches.

The annual 1Life Generational Wealth Survey revealed that less than half of policyholders have managed to maintain all their insurance policies amid ongoing economic challenges. Yet, despite these difficult circumstances, the survey revealed that South African women have recognised the critical importance of safeguarding their families’ future through the right insurance cover. However, additional financial-education efforts remain necessary.

Life insurance as a generational-wealth building tool

Although financial literacy has improved over the years, many people seldomly think of insurance when they think of generational-wealth building tools. According to the 2024 Generational Wealth Youth Survey only 40% of respondents indicated that having insurance policies such as life cover equates to wealth. This indicates a clear gap in people’s understanding regarding how having the right insurance can provide the necessary financial safety net amid life’s uncertainties.

Life is full of uncertainties, and while addressing these may seem overwhelming, getting the right cover will be life changing to your loved ones – especially if you are a breadwinner, or have family members who are financially dependent on you. The reality is, if a primary breadwinner passes away, households without life insurance are left financially exposed, often unable to sustain their standard of living.

In such cases, the absence of life insurance can quickly unravel years of progress, leaving families vulnerable and deepening the cycle of poverty. Long-term insurance such as life cover will make sure that your family is taken care of when you are no longer able to provide for them – securing not only their financial future but enabling you to continue with your generational-wealth building plans.

Securing your property for future generations

Purchasing a home is a milestone for many South Africans; many see this as a way of building generational wealth. The 2025 Generational Wealth Youth Survey revealed that 78% of respondents associated generational wealth with property and land. However, death can quickly turn this home-ownership experience into a stressful time.

Having life-insurance cover will ensure you are able to safeguard your family’s financial future by covering the unexpected expenses. Banks may also require you to take out life-cover insurance to cover your home loan should you pass away. This gives the bank power to claim the amount you owe should an unexpected loss of income occur.

Therefore, it makes financial sense to have a life cover with a payout that can help in paying for daily expenses such as food, clothing, school fees and rent or home loan. Having life-insurance cover will ensure that your family is protected in the event of death and ease the financial stress that comes with the loss of a loved one.

Generational wealth in South Africa is under threat, but life insurance remains the engine of your family’s financial protection. Without life insurance, households risk financial collapse should a breadwinner pass away. Yes, life may be unpredictable but taking an opportunity to protect your family’s financial future and accelerating your generational-wealth building plan is important.