“I remember how adamant my husband was about getting funeral insurance. He wanted to ensure that should something happen to him, I would be able to cope with the cost of his funeral,” recalls Vitolia Tagialupe.

Earlier that day, retired taxi driver Galumalemana Tagialupe had seen an advertisement on the local television channel about a new type of insurance that only recently became available in Samoa. ‘Leave a legacy’, an insurance campaign by the Apia Insurance Company (AIC) was informing people they could buy insurance to cover the cost of funerals and Galumalemana had convinced his wife that it was important they get that protection.

The next day, Vitolia filled out the application form and arranged to make fortnightly payments to cover the annual premium of WS $700. Depending on her weekly budget, she paid between WST 50 – WST 100 from her wages working as a cleaner. Vitolia was surprised by how easy and simple the process was to get the insurance cover.

A month later, unfortunately, her husband passed away due to an accident in their home. While the couple had some savings, the amount would not have been enough to cover expenses for a traditional Samoan funeral. Added to that, her husband did not have any superannuation or pension because he had worked his whole life in the informal sector and had not enrolled in a retirement scheme.

“I am so thankful that my husband persuaded me to buy the funeral insurance because honestly, it was a saving grace for me. Within two days of sending in my insurance claim, I received WST 10,000 in my bank account and this money covered a large part of the costs involved with giving my husband a proper send off, as is required by my Samoan culture,” she added.

Vitolia’s family and local community came together to help with some of the funeral expenses, which soon mounted up. Vitolia estimated that the total cost was around WST $25,000, which included covering the cost of the funeral, burial and catering for around 60 mourners.

“I’m so grateful that I didn’t have to take out a loan to cover the funeral expenses. I am now planning to take out an insurance policy for myself so that my son has some financial help when the time comes for my own passing. I look at insurance as a sort of savings scheme; money that’s there when you need it the most and I do feel like my husband left behind a great legacy,” said Vitolia.

She added that despite what many people think about the cost of insurance, she was able to afford the small payment plan that she had negotiated with the AIC.

The cost associated with observing Samoan funeral rites
In Samoa, funerals can be an elaborate and expensive affair. A Waikato University research on Samoan funeral rituals[1] found that the financial commitment to bury a loved one in Samoa can be quite substantial, depending on the status of the person who has passed away, the status of those who attend a funeral, and the reputation or impression the family who are performing the exchange rituals, desire. Without savings or an insurance families can often go into financial debt from the loans they must take to cover funeral expenses, which can cost anywhere between WST 10,000 – WST 60,000.

Insurance, alleviating funeral expenses

Insurance helps families to restabilize their financial situation especially during shocks like a death in the family. To encourage the development of more insurance products that are tailored to the needs of people that are typically excluded, such as the Tagialupe family, the Pacific Financial Inclusion Programme (PFIP) partnered with AIC in October 2018 to pilot a funeral expenses product.

Samoans over the age of 18 can buy funeral insurance and nominate up to two people to be covered by the insurance – the “insured life or lives”. So, people may purchase insurance for their parents and make themselves, the beneficiaries to receive claim payouts. To qualify for the insurance, the insured person does not need to have a medical examination, meaning that it’s easier, cheaper and faster to get the cover.

There are different levels of cover available ranging from WST 10,000, WST 20,000 and WST 30,000, and the premium of the insurance increases with the age of the people covered.

Typically, a claim is processed and paid within 48 hours of receipt of the claim to ensure that families are able to access the funds when they need it the most; before and right after the funeral.

To date, AIC has sold over 1,000 policies and paid out 11 claims. While most clients have been mainland Samoans, the insurance is slowly getting interest from Samoan migrants living overseas, most notably New Zealand, the US and American Samoa.

Since the launch, AIC has been working with PFIP to update the product and the marketing thereof to better match it with the needs of Samoans. It has so far changed its pricing structure, distribution channels and AIC is now looking to introduce group policies that allow employers, religious organizations or clubs to pay for their staff or members’ insurance.

In the coming months, AIC will also release a digital application form and will set up an agent network to market the product to rural areas and the outer islands of Samoa.

[1] Seiuli, Byron. (2015). Ua tafea le tau’ofe: Samoan cultural rituals through death and bereavement experiences – https://bit.ly/2MQyvcl

About the Pacific Financial Inclusion Programme
PFIP is a Pacific-wide programme that has helped more than two million low-income Pacific islanders gain access to formal financial services and financial education. It does so by funding innovative approaches in development of financial services, supporting policy and regulatory initiatives, and empowering consumers.

PFIP is jointly administered by the United Nations Capital Development Fund (UNCDF) and the United Nations Development Programme (UNDP) and receives funding from the Governments of Australia and New Zealand and the European Union.