Qorus Innovation in Insurance Awards 2024

Discovery Home Loan Protector

Submitted by

Discovery

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Discovery is a proudly South African-founded financial services organisation that operates in the healthcare, life insurance,...

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18/04/2024 Insurance Innovation

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When clients take out a Discovery Home Loan, they can get up to 1.5% off their interest rate when they add home and personal risk protection, and manage their money well through the behavioural Shared-value Insurance model.

Innovation presentation

South Africans have more than $50 billion in home loans – 7 times more than credit cards.

Choosing the right home loan is critical. For example, we estimate Discovery clients could save over $900 million in interest over their remaining home loan terms with just a 1% reduction in interest rates.

With Discovery, clients can get a comprehensive home loan package that integrates a home loan with financing, insurance protection for their home and family, and rewards for managing their money well – including a reduction of up to 1.5% in their home loan interest rate. This includes:

- Home Loan: Clients get competitive financing for their new or existing home, or the ability to switch to a better deal on their existing home loan.

- Home Insurance: Comprehensive cover for a client’s largest investment, home contents and portable items.

- Home Loan Protector: Protects a client’s family home in the event of death or any of the Defined Medical Conditions.

Many banks have mandatory requirements to take short-term and/or life insurance when clients take a home loan. However, Discovery recognises that we can use the behavioural Shared-value Insurance model to incentivise these clients to add these insurance products and manage their money well, thereby significantly lowering their credit risk with the resulting reduction in risk enabling us to provide them with reduced home loan interest rates.

Therefore, with a Discovery Home Loan, clients can get up to 1.5% off their interest rate for protecting their home and personal risk, and managing their money well.

Uniqueness of the project

When clients take out a Discovery Home Loan, they can get up to 1.5% off their interest rate when they add home and personal risk protection, and manage their money well.

By adding the Home Loan Protector to their Home Loan, clients reduce their home loan interest rate by up to 0.25% on their home loan interest rate through reducing their risk, and more importantly, gain peace of mind that their families’ homes are protected. The Home Loan Protector offers:

- Protection for the home loan in the event of death or any of the Defined Medical Conditions for illnesses and disabilities

- Cover that tracks the Home Loan limit but never drops below 25% of the initial home loan amount

- Level premiums throughout the policy term

On top of this, by adding Home Insurance to their Home Loan, clients can reduce their home loan interest rate by up to 0.25% on their home loan interest rate by protecting their asset and financial stability against the risk of an unexpected event that affects their home and/or contents.

In addition to the interest rate discounts outlined above, depending on the client’s banking product they can reduce their home loan interest rate by up to 1%. This means clients can experience a 1.5% reduction on their Home Loan interest rate, simply by engaging in the Vitality Money programme and managing their money well.

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