The Re-insurance Group of America carried out research which confirmed that 1 in 30 claims submitted were fraudulent amongst insurance companies in America, Middle East, Europe and Asia. It costs the global industry billions of dollars annually. South Africa is no different and has not been immune from this unfortunate phenomenon with the South African Insurance Association (SAIA) recording that as much as 32% of all claims in general were found to be fraudulent as of 2017 and this costs millions, if not billions to the local insurance industry.
Starting a new business can be terrifying.
The risk of being kidnapped may not be the most common risk but it is increasingly becoming a risk that foreign nationals, in particular, face in South Africa.Aside from it being a hugely traumatic experience for anyone to go through, the people or business dealing with the incident may also potentially face tremendous losses.
A business can face enormous unexpected expenses should it be held liable for an environmental disaster. Particularly as this type of event is usually not covered by a general liability policy.
Environmental liability cover – also called environmental impairment cover – provides cover for the cost of cleaning up pollution and restoring the affected area to its pre-disaster state, after an accident caused by the insured.
The nature of risk facing directors and officers of a company has evolved dramatically over the last decade. Traditional directors’ and officers’ policies used to provide enough protection to cover the company and its CEO, but this is no longer the case. In the age of digitisation and social media, companies and their CEOs are more vulnerable to reputational crises than ever before.
In November 2013, hailstorms in the north of South Africa resulted in claims worth more than R2 billion. More recently, the devastating Knysna fires, fanned by winds in excess of 50km/h, caused major damage in the Garden Route region. More than 26 fires broke out in at least 12 suburbs in the area. 10 000 people were evacuated from their homes and at least 500 homes were destroyed in the inferno. These fires are being called an act of God. In this blog, we take a look at what this term means along with the associated implications.
According to insurance underwriter Camargue, more than a third of South Africa’s companies have experienced data breaches and a staggering 974 million company records were lost or stolen in 2014.
Have you noticed that car insurance can vary quite a lot for the same kind of car depending on the insured and the insurer? In this blog, we discuss the factors insurers consider when determining what your car insurance premium will be, and what you can do to keep it to a minimum.
Fleet management is the administration of a company’s fleet of vehicles that are used to transport goods in the business’ daily operations. The South African fleet management market is growing rapidly, it is estimated that the percentage of business fleet vehicles will increase from 21.5% in 2015 to 32.5% in 2020. In South Africa, the freight industry still largely favours road transportation, as opposed to rail transportation, which explains the robust state of the industry.
Over the last two weeks, there have been lots of questions about how South Africa’s downgrade to junk status will affect consumers. Businesses and individuals are bracing themselves for the knock-on effect of the ratings downgrade.
Essentially, the ratings downgrade activated the rand’s devaluation. There is an inseparable link between the rand’s value, the interest rate and the inflation rate. Downward pressure on the one, over time, almost always negatively affects the other two.
Your home - and its contents - should always be insured to the full replacement cost, to avoid the risks of loss or damage due to theft, burglary, fire, flooding and more. More importantly, your home should be insured at the current replacement value to ensure you have sufficient insurance should something happen. This replacement value needs to be calculated regularly – at least annually – so that the value is always relevant.
Many South African businesses are not prepared for the unpredictable and dynamic risk that cyber-crime poses. Out-of-date data and system protection policies keep businesses at a disadvantage, in a risk category that is already difficult to forecast or mitigate.
As awareness around this growing threat increases, it is imperative to stay informed about the latest breach attacks and the recommended mitigation strategies.
Remote jamming – or car jamming – has become an everyday occurrence in South Africa - and it is on the increase. The South African Insurance Association (SAIA) confirmed that remote jamming is the second most common way personal belongings are stolen from a car.
Several severe, seasonal fires have ravaged the Western Cape over the last two months, fuelled by high temperatures and strong winds. At the same time, the north of South Africa has been battling heavy floods. Both have left trails of destruction in their wake - with the insurance industry expected to bear the financial burden. These phenomena illustrate just how vulnerable we all are to weather and fire catastrophes.
As we dive into 2017 with renewed energy, here are a few important insurance factors you should consider to ensure you’re comprehensively covered this year. Many people are predicting that this will be another tough economic year, but with careful planning and preparation you can protect yourself, your family and your valuables.
The ratings agency downgrade South Africa narrowly avoided last week was a stark reminder of the challenging business environment South African businesses face. Business owners should continuously scan the environment they operate in for possible risks – new and old – because, as the old adage reminds us: prevention is better than cure.
In this blog, we focus on the important - and often misunderstood - difference between gradual and accidental damage. It is imperative that everyone with insurance understands this difference and is aware of their obligation in terms of maintaining their own property, as well as other key policy exclusions that may result in the non-payment of a claim.
To make the distinction between gradual and accidental damage ask yourself this simple question: How quickly did the damage occur – suddenly or over time?
One of the most severe risks facing South African businesses is the increasing shortage of water. We are used to taking this precious resource for granted but as water shortages become a global reality, water’s growing commodity value is making it the new oil. Prolonged drought could also have a negative effect on electricity generation, further interrupting business operations.
The increasing popularity of drones for commercial and recreational use, makes this the latest technological advancement to fundamentally impact many industries - including the insurance industry. Although drones have innumerable uses, which can include bringing cost-cutting and efficiency benefits to your business, they also pose substantial new risks.
The purpose of a broker is to offer personalised advice, get the best deal for you and be available to help you after the sale. Recent changes in the regulation of the financial services industry have resulted in an even more professional service from brokers. This benefits you - the consumer - as now there are a number of recourse routes available if you don’t get satisfactory service from your broker.
In this blog, we address some of the most important reasons you should work with a broker.
As we head towards summer and the festive season, the probability of having a few drinks and then driving becomes higher. Aside from facing a huge fine, a potential prison sentence and a criminal record - it is important to remember that your insurance company is under no obligation to meet your claim if you are under the influence of alcohol when you’re involved in an accident.
These days, businesses are increasingly falling victim to data breaches - so it is safe to assume that your business is also at risk of a cyber attack at any time. Most office employees use email and the Internet every day, making them your first line of defence against cyber crime - but also a soft target for cyber criminals.
In a previous blog discussed 10 types of insurance you need to insure your business against. One of the key business insurance options we listed in that blog was Fidelity Guarantee Insurance. Fidelity Guarantee Insurance protects your business from theft or any financial loss incurred from fraudulent activities or theft by your employees while they are employed by you.
Being under-insured can have serious - negative - financial implications when something goes wrong. People are under-insured for various reasons, many do not even realise they are under-insured, while others only insure the bare minimum to save money. Unfortunately you’ll only discover the true impact of being under-insured when you submit a claim and find that only a fraction of the replacement costs you require can be covered.
Installing a burglar alarm will improve your home security. The alarm system may need to be stipulated on your insurance policy, so it is best to check with your broker. It is your responsibility to ensure that you fully understand all the warranty requirements for your alarm system, as this will be vital to the success of your future claims.
The South African transport industry is a sizable - and growing - industry. It’s a specialised industry with specific requirements that present unique risks. This makes selecting effective, comprehensive insurance cover quite a challenge but very important.
Liability cover is a necessity for any business owner as without such cover, it can potentially have a devastating effect on a thriving business. Liability insurance provides protection from an array of risks and as a highly specialised insurance field; it is advisable to partner with an experienced and knowledgeable broker.
As a state-owned company, SASRIA SOC Limited is a short term insurer that provides cover for people and business with assets in South Africa against extraordinary risks. There is no other insurer that provides this kind of cover in South Africa. Their mandate is to provide cover against special risks such as strikes, lockouts, riots, civil commotion, labour disturbance, public disorder and terrorism.
High levels of unemployment and huge inequality in South Africa have led to crime being an unfortunate reality in our lives. In 2014, 11,129 cases of carjacking and 989 cases of truck jacking were reported by the SAPS. The positive is that according to national statistics, hijackings in South Africa are declining.
There is a growing trend for the agricultural industry to be under-insured, or not insured at all, particularly when it comes to crops and livestock. Agricultural insurance is one of those expenses farmers will cut in an effort to reduce monthly business costs which provides short term relief but endangers farming operations in the long term.
The short-term insurance industry is undergoing fundamental change which is primarily driven by information technology. Not too long ago, customers bought all their insurance cover during face-to-face meetings from advisers through paper-based systems. Today, consumers research products online and the next generation of insurance buyers will be buying more products online, including insurance.
As a business owner, you need to contemplate the worst case scenario to ensure that you are adequately prepared for all the challenges that may affect your business. Unforeseen events and natural disasters are one of the potential threats that you need to be prepared for as it can potentially spell the end of your business.
In November 2014, the Financial Services Board (FSB) initiated a Retail Distribution Review (RDR) to introduce some reforms to the regulatory framework that would ensure fair treatment of customers and responsible dispensing of advice by financial intermediaries. The review was a response to concerns regarding the role of broker consultants and financial advisers in giving financial advice and their motivation for recommending financial products. Part of the concern was that the needs of the consumer weren’t always the main motivating factor as lucrative incentives often played a distracting role.
Some of the cyber crime risks you or your company are exposed to include loss of revenue, loss of data, cost of replacing data and associated downtime, damage to your reputation, possible litigation due to compromised data, etc.
The Cape Town drought has started having a substantial impact on the lives of Capetonians, with water saving measures being implemented and people stockpiling water to such a degree that the retailers can’t stay ahead with supply.
The question is how will Day Zero affect your insurance cover and what factors should you be aware of in terms of risk mitigation and keep your belongings covered and your assets protected.
The risk of being kidnapped may not be the most common risk but it is increasingly becoming a risk that foreign nationals, in particular, face in South Africa.
Aside from it being a hugely traumatic experience for anyone to go through, the people or business dealing with the incident may also potentially face tremendous losses. Costs can occur naturally as a result of paying a ransom but such an event may also result in legal proceedings, interruption of day-to-day business and possibly reputational damage.
Starting a new business can be terrifying. There are so many dynamics to consider and adding insurance to that list can be overwhelming. However, without sufficient cover your venture may crash before it has the chance to take off.
Theft, fire, liability, cybercrime and fraud by employees are only a few of the potential perils facing businesses.
Nobody wants to go through the effort of submitting an insurance claim and having it rejected by your insurer due to factors that were preventable or within your control.
Compliance is lackingIt is estimated that a large number of South African businesses are estimated not compliant with basic fire safety requirements, as business owners are either unaware of regulations or only comply with minimum requirements in order to save money.
The South African agricultural landscape is changing.
The short-term insurance industry is undergoing fundamental change which is primarily driven by information technology.
A renowned study analysing the risks faced by corporates on a global scale, was released recently. This blog focuses on the findings of that study, in the ever-expanding and dynamic area of business interruption and its far-reaching effects.