Q&A – 12 December 2011

Mistrust of life insurance companies

Due to my health I have been advised to purchase a life insurance policy. Who can apply for such policies and how do I get paid in case of a claim. How long are such policies and can I cancel the policy? What else do I need to know about life insurance policies. Are these companies that provide such covers trustworthy?
DU, Dar

There is no limitation on who can apply for life insurance policies. Anyone above the age of 18 is usually eligible, but the general principle is that the older you grow the higher the yearly premiums. In your case, it is likelier that your premium per year will be quite high due to your health condition. In some developed countries over 60% of adults have some form of life insurance; unfortunately in Tanzania most people sadly have no such cover mainly because of lack of exposure on the importance of such a policy.

Your question on how you get paid when there is a claim is quite interesting. In the standard life insurance policy, the claim is payable when you are dead and buried and hence you, as the insured, do not get paid. It is the beneficiary of the policy who is entitled to the amount of the policy, not you. The beneficiary of the policy must also be aware that there exists such a policy to be able to lodge a claim and it is critical that such information is available to the beneficiary.

There are two main types of life insurance policies- the term life and the full life policy. The main distinction between these two policies is that the term life is for a certain period of your life, and any claims are only payable if you die during that period. The full life is for your entire life and hence one day the beneficiary will get paid.

Most life insurance policies are cancellable and you are not eligible to any refunds. Over the last ten years, there are newer and more flexible policies that have evolved that you can consider. There are policies whereby you can cash in your policy after a certain number of years for the educational needs of your children.

In terms of the trustworthiness of life insurance companies, we must admit that this market is merely developing now and it is too early to tell. However life insurance companies have had their share of bad luck in other countries. We suggest you contact your broker for further information.

Landlord interfering with lease

I have a landlord who keeps on interfering with my activities. I pay my rent on time and yet the landlord writes me letters of do’s and don’ts. For example the landlord has said that I should not use the house for my small business which brings me income. Why should the landlord care about what I do with the house when I am timely paying rent? The landlord has also informed me that she intends to increase the rent at the end of the tenancy. Is there a law that restricts him from increasing the rent unreasonably?
SU, Dar

As a tenant, apart from paying rent, there are other terms and conditions that you must follow. Paying rent is only one of them. It seems like your tenancy is for a residential house. Converting a residential house into a place from where to run your business from may require consent of the landlord and the landlord may have the right to refuse such consent. You need to read the lease agreement carefully and understand its contents. Your attorney can guide you further.

Your second question is on any restrictions as to rent increases. Unfortunately for you and fortunately for landlords, the Rent Restriction Act which restricted the amount of rental increase has been repealed. Hence there is no law that stops your landlord from increasing the rent for the new tenancy agreement or as per agreed terms of the current tenancy.

No passage to my plot

I own a plot of land in Kigamboni area. There are plots that surround me and who started development before me. When I visited my site recently I realised that I do not have access into my plot, save for a 1metre path which cannot accommodate even a tricycle to go through. My neighbours tell me I should park my car on the roadside and walk to my plot. What should I do?
FL, Kigamboni

The Land Act specifically provides for such situations in that an occupier of landlocked land may apply to court for an order, referred to as an access order’ granting reasonable access to that land.

A copy of the, application shall be served on the Occupiers of each piece of land adjoining the landlocked land, any Person claiming an interest in any such piece of land of whom the applicant has actual notice, the local authority having jurisdiction in the area where the landlocked land is located and such other persons occupying or having an interest in land which in the opinion of the court may be affected by the granting of the application.

The Court may then make an appropriate order and in considering whether to grant an access order, the court shall have regard to- (a) the nature and quality of the access, if any, to the landlocked land when the applicant first occupied; (b) the circumstances in which the land became landlocked; the nature and conduct of the negotiations, if any, between the occupiers of the landlocked land and any adjoining or other land with respect to any attempt -by the occupier of the land to obtain an easement from one or more occupiers of the adjoining or other land (c) the hardship that may be caused, to the applicant by the refusal of the access order, in comparison to the hardship that may be caused to any’ other person by the making of the order, (d) the purposes for which access is or may be required (e) any other matters which appear to the court to be relevant. We suggest your attorney makes such an application if you have failed to sort this out with the neighbours.