Clayton Munsami loses claim for mother's life insurance pay-out after failing to pay premiums

A PINETOWN court has ruled against Clayton Munsami, who sought reimbursement of over R200 000 for life insurance premiums after being removed as a beneficiary by his mother, Jeevarani Munsami, due to his failure to pay premiums.

Clayton Munsami sued his mother, Jeevarani Munsami, after she removed him as the sole beneficiary of her Hollard and Liberty Life insurance policies.

The court heard that the mother and son had a verbal agreement: Clayton would pay the policy premiums, cover utilities, and pay for the home security system.

In exchange, he was to receive the full R3.3 million pay-out upon his mother's death.

However, when the son failed to pay premiums, Munsami changed the beneficiaries of her life policies to her sister and her nephew, who would receive equal shares upon her death. She also stated that her son had moved out.

Clayton admitted to the court that he struggled financially during the Covid-19 pandemic, which caused him to default on several payments, including his mother's utilities and the premiums for her life insurance policies.

His failure to pay the premiums timeously led the insurers to threaten cancellation of the policies.

His mother told the court that the home security system failed in October 2020 because Clayton stopped paying for it as agreed. Furthermore, she stated that when she tried to alert him about the missed insurance payments, he ignored her calls.

Munsami explained that she had to intervene to save the policies because they included her funeral benefit, and due to her chronic health condition, she could not secure new life cover.

Magistrate Muntukayise Khumalo concluded that Clayton's own admissions constituted a breach of the oral agreement he had with his mother.

“This, on its own, is a good reason for Jeevarani to have taken action to protect her interests in the policies as she stood to lose a funeral cover plus life cover, which she would not have been able to replace due to her chronic illnesses,” Magistrate Khumalo ruled. 

He said oral agreements in the country are legally binding but pose substantial challenges regarding proof and enforceability. 

The court found that Munsami was well within her rights to make other arrangements for the continued payment of insurance premiums and to change the beneficiary as she considered necessary. 

The magistrate said Clayton failed to prove on a balance of probabilities that he is entitled to the relief he sought. 

“Applying the principles in National Employers’ General Insurance. Co Ltd V Jagers, this court is of the view that the probabilities in this matter favour the defendant (Jeevarani),” Magistrate Khumalo said. 

He dismissed the application with costs. 

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