Refusing the jab may have financial implications

By Martin Hesse Time of article published Aug 23, 2021

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Vaccine hesitant? If the compelling evidence coming out of the United States and United Kingdom on the efficacy of vaccines in preventing serious illness and death from Covid-19 isn’t enough to convince you to take the jab, your life insurer and your employer may use more direct means to do so.

Recently a woman radio presenter on a morning drive show related how she had looked forward to her first bungee jump. However, when faced with the reality of plunging headlong into the abyss, she froze with fear. Twice the assistants encouraged her with a resounding “One...two...three...bungee!” and twice she retreated into a corner. On the third time, as they shouted “One...two...three...bungee!”, they gave her a shove over the edge.

I wondered whether what they had done was illegal. I don’t think any indemnification agreement would have extended to involuntary participation.

While the analogy is a fun one, there is a distinct difference, which puts taking the vaccine on a different level: you do not only take a vaccine for your benefit; you take it for the benefit of those around you. So the question becomes whether the benefit to the community outweighs your right to choice as an individual.


Last year I wrote an article, “Should anti-vaxxers pay more for life insurance?”, based on a research paper by actuary Pamela Hellig, which she presented at the 2020 Actuarial Society of Southern Africa convention. Hellig looked at anti-vaxxers generally – the various vaccines to combat Covid-19 were still in their trial stages. She concluded that there was nothing unethical in making vaccination against life-threatening diseases a risk factor in the underwriting process.

A few weeks ago, Discovery Life took up the baton in the fight against Covid-19. In line with the company’s philosophy of shared value – the lower the risk you pose to the insurer through pursuing a healthy lifestyle, the more you benefit through its reward programmes and premium discounts – its chief executive, Riaan van Reenen, said that being vaccinated against Covid-19 was now an additional consideration in determining life insurance premiums for new clients, effective from July 29.

“We want to reward our clients who have helped the country by getting vaccinated. Through our premium PayBack reward mechanism, we are offering all qualifying clients their maximum possible PayBack, given their selected PayBack option and Integrator type, for the first year of their new policy,” said Van Reenen.

Along with the carrot, there was also a stick: Discovery stated that clients with new polices who indicate that they refuse to get vaccinated “may, unfortunately, be subject to higher premiums, due to the increased risk”.

Van Reenen said: “Vaccinations are extremely effective in preventing hospitalisations. Even if only 8% of a population does not get fully vaccinated, that 8% will experience more hospitalisations than the other 92%. This follows from the fact that vaccinated individuals experience a 94% lower real rate of admission than those who are not vaccinated.”

Discovery’s decision comes on the back of the insurer paying its highest ever amount in claims in a single month, during January 2021.

However, when approached by Personal Finance, four other large insurers, which are also facing large claim volumes, said they were not currently considering making vaccination against Covid-19 an underwriting criterion (see “Responses from life insurers”, below.)


The Department of Labour recently published guidelines stating that employers can make it mandatory for their employees to be vaccinated against Covid-19. However your employer cannot introduce such a policy without clear reasons for doing so, and cannot summarily dismiss employees who refuse vaccination.

Louise Woodburn, general manager of KBC Risk Solutions, said while the guidelines state that mandatory vaccinations can be implemented by employers, this is by no means a blanket policy that can be unilaterally applied.

“Employers need to justify their particular circumstances, including the nature of work and the size of the workforce. For example, a small enterprise where the majority of the workforce is able to operate remotely would not be able to justify this approach, whereas a mining or manufacturing concern would certainly have adequate grounds for such a policy,” Woodburn said.

She said it must also be understood that collective agreements that are already in place with unions will take precedence. “It is important for businesses to work with unions and communicate clearly, engaging with the workforce on the issue.

“Once a risk assessment has been conducted to determine the necessity of a mandatory vaccination policy, a plan needs to be formulated to develop clear specifications. This includes how to handle circumstances where individuals will not vaccinate for personal reasons,” Woodburne said.

According to a report earlier this week in Business Report, labour law specialist Bradley Workman-Davies at Werksmans Attorneys said an employee could be dismissed if the operational requirements of the job required the employee to be vaccinated. However it was unlikely that an employee could be dismissed for misconduct (failure to obey a lawful instruction), as the employee is legally entitled to refuse vaccination.

He said an employer would need to consider other measures before dismissing such an employee. “The employer must try to accommodate the employee with workplace measures (social distancing, isolation, mask wearing) or in a different position that does not require the employee to be vaccinated,” Workman-Davies said.

Webber Wentzel partner Dhevarsha Ramjettan cautioned employers against dismissing employees who refused vaccination. “Employees have a right to challenge the fairness of their dismissal at the Commission for Conciliation, Mediation and Arbitration or any relevant bargaining council,” she said.


• Liberty: Liberty recognises that the government-led vaccination programme is a critical strategy to preserving lives in response to Covid-19. Liberty supports the mass vaccination programme and government’s objective of ensuring equitable access to vaccines for everyone, whether they are members of a medical aid scheme or not. We are pleased to be playing our part in helping to curb the pandemic and have recently opened a public vaccination centre at our head office in Braamfontein, Johannesburg. We encourage all eligible members of the public to get vaccinated and thereby reduce the health risks associated with the pandemic.

“Liberty constantly reviews developments that could potentially impact the health and well-being of our clients and we are closely monitoring mortality and morbidity data relating to the local and international Covid-19 vaccination roll-out. As vaccines are only beginning to be rolled out to people under the age of 35, we feel it is premature to be making changes to our underwriting position at this stage.”

• Old Mutual: “Old Mutual fully supports government’s stance that people should be encouraged, but not forced to take the vaccine. It is imperative that we ramp up vaccinations to safeguard public health and reach herd immunity as quickly as possible. Old Mutual is currently not implementing differential pricing based on whether a policyholder is vaccinated or not.”

• OUTLife: “At this stage we have no such plans but we will continue to monitor the impact of the pandemic on health and mortality related claims statistics which will inform any future decisions.”

• Sanlam: “Sanlam supports vaccination as an effective means to fight the Covid-19 pandemic, noting international research and experience which indicate that vaccination effectively reduces the risk of severe illness, hospitalisations, and death. While we strongly encourage our clients to get vaccinated, we recognise that vaccination is an informed choice and requires a voluntary decision. We can confirm that no changes will be made to policies that are already in place and that existing cover will remain unchanged.

“Lessons learned from the pandemic and our preventative measures put in place, may shape insurance products in the future. Similar to other health markers such as compliance to treatment and a fit lifestyle, Covid-19 vaccination may in the future, be viewed as a positive rating factor in the overall health assessment of an individual. Our current vaccine rollout programme has gained momentum over the last few weeks, but we recognise that this is a journey that is incomplete until our entire adult population has been offered the vaccine independent of age or geographical location.

“Sanlam will continue to support our Government’s vaccine programme and we will continue to monitor the situation, taking direction from the World Health Organisation, the South African Department of Health, as well as the National Institute for Communicable Diseases.

Further information on Sanlam’s approach to vaccinations and how this impacts clients’ cover can be found here.”


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