Understanding Credit Life Declarations.

What is Credit Life insurance for?

Credit Life insurance is designed to settle an outstanding loan balance in the event of death, permanent disability, or in some products, temporary disability. It protects surviving family members from inheriting debt — one of the most common financial hardships following a breadwinner's death.

Dikwata Insurance Agency's Group Credit Life product covers outstanding loan balances up to P250,000 and extends to temporary and permanent disability, critical illness, and retrenchment scenarios depending on the benefit structure chosen at group level.

What is a declaration and why does it matter?

When you apply for a Credit Life policy — especially if you join outside of a general group intake — the insurer will ask you to declare your health status and any pre-existing medical conditions. This declaration is used to assess the risk being insured.

The insurer uses this information in good faith. If you have a known chronic illness, a recent surgical history, or an ongoing medical condition, these facts must be disclosed. Policies are underwritten on the basis that the declaration is accurate and complete.

What happens when a declaration is incomplete?

If a claim is submitted and the insurer discovers that a material fact was not disclosed — particularly one that would have influenced whether the policy was issued or at what premium — the claim may be disputed or repudiated. This means surviving family members receive nothing from the policy, and the loan obligation may remain.

This outcome is especially severe when the undisclosed condition is directly related to the cause of the claim. Courts and regulators in Botswana and across the region consistently affirm the insurer's right to void a contract where material non-disclosure is established.

Common declaration mistakes to avoid

• Failing to disclose a chronic illness such as diabetes, hypertension, or HIV-positive status.
• Not mentioning a recent surgery or hospitalisation at the time of application.
• Assuming that a condition treated years ago is no longer relevant — if asked, disclose it.
• Declaring only conditions you are currently receiving treatment for, rather than all known conditions.
• Not informing your intermediary when your health status changes materially after policy inception.

How disability claims work under Credit Life

Disability claims under Credit Life typically require independent medical certification confirming that the claimant is permanently and totally unable to work in any occupation, or — for temporary disability — that they are unable to work in their own occupation for a defined period.

The certification process is managed through the claims department at Dikwata Insurance Agency. Policyholders or their families should initiate the process as early as possible, as delays in notification can complicate the assessment.

If in doubt, disclose

The simplest principle to follow when completing a Credit Life declaration is this: if you are unsure whether something is relevant, disclose it. The cost of an over-disclosure is negligible. The cost of an omission can be a denied claim at the worst possible moment.

Our agents at Dikwata Insurance Agency are available to walk through the declaration form with you before submission to ensure every section is completed accurately.