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Government bailout for short-term insurer Sasria might be in the offing to settle post-looting claims

Sasria expects insurance claims from destroyed businesses to range between R10bn and R20bn. The short-term insurer doesn’t have enough money to cover these insurance claims. National Treasury might come to its rescue through a taxpayer-funded capital injection to its balance sheet.

SA’s state-owned short-term insurer, Sasria, expects insurance claims arising from last week’s looting and anarchy to be so daunting that it might be forced to ask National Treasury for financial assistance. 

Approaching the Treasury (or the SA taxpayer) for financial assistance will be a first for Sasria in its 40-year history as the state-owned insurer has relied on its healthy balance sheet and not government bailouts for survival. 

Sasria now expects insurance claims of between R10-billion and R20-billion from businesses that have incurred damages to their insured property as a direct result of social unrest in Gauteng and KwaZulu-Natal. But this is a preliminary estimation, as Sasria’s team of insurance/claim adjusters is still counting the cost of the damage that has left 200 shopping malls and 3,000 stores destroyed.

The billions of rands in insurance claims might break Sasria and force Treasury to come to its rescue through a taxpayer-funded capital injection to its balance sheet. Put differently, Treasury might bail out Sasria, the only insurer in SA that provides cover for losses or damages to insured property as a direct result of civil unrest, including rioting, strike action, and public disorder. The political violence and riots before SA embraced democracy in 1994 have pushed private sector insurers to no longer provide cover for social unrests — leaving Sasria as the only insurer that does so. 

Cedric Masondo, the MD of Sasria, told SAfms Stephen Grootes that the insurer has been working with Treasury and the government to “prepare for the worst” as the value of insurance claims from affected businesses is likely to exceed the amount of cash that Sasria has on hand. 

“Should we exceed our capacity, there is an option on the table to work with the government so that we can pay the claims – even if it means that we require a capital injection,” Masondo told the radio station.  

“But the government, as a [sole] shareholder [of Sasria], is expected to provide capitalisation to Sasria. That’s what happens to companies when they run into trouble.”  

Masondo was not immediately available to comment further when Business Maverickreached out to him. 

A government bailout for Sasria would create a headache for Treasury, which is facing growing demands to fund income-relief measures for poor households and businesses affected by the social unrest. Business, labour, and community partners have agreed – through several meetings at the National Economic Development and Labour Council – on a range of income-relief measures, including using Sasria as the main mechanism through which destroyed businesses could be compensated for financial losses. 

The past few years have been easy for Sasria. It collected more than R2.4-billion in insurance premiums during the 12 months to March 2020, an 11% increase on its 2019 financial year. It paid out claims amounting to R992-million, which is less than the R1.6-billion in claims it received in 2019. Sasria managed to record a profit after tax of R333-million in 2020. 

In the wake of fresh violence and looting last week, Sasria was confident that it would be able to fund insurance claims from businesses through its balance sheet and without any assistance from Treasury.

Since then, Sasria has been inundated with claims as businesses have started to rebuild and repair their operations. At a cursory glance, insurance claims of between R10-billion and R20-billion would bankrupt Sasria if it were a private sector insurer. It has cash on hand amounting to R2-billion. Sasria also had investments worth R8.5-billion (valuation as of 31 March 2020) in listed shares, money market instruments and bonds. But the Sasria board is not yet prepared to liquidate these investments to free up cash. 

Sasria has relationships with global insurance companies that might help it honour insurance claims in SA, through its reinsurance arrangement. Although Sasria has shared the risk of losses or damages to insured properties with other insurers, it is expected to carry most of the burden of honouring insurance claims.

Photo source: facebook individuals
By Ray Mahlaka (21 July 2021)
Article featured in Business Maverick

Can Sasria honour claims of up to R30bn? - It has less than R7bn available.

You can sail a 22-foot yacht across the Atlantic by yourself if things go right, but you will struggle to survive if they don’t.

The man holding the helm at the South African Special Risk Insurance Association (Sasria), managing director Cedric Masondo, has just sailed into a huge storm in a boat that is probably too small to reach land without serious damage.

Sasria’s latest annual report creates the impression that the recent unrest, looting and vandalism will create the biggest challenge the association has ever encountered since its establishment in the late 1970s.

The last few years were relatively easy. Sasria paid claims for damage resulting from the odd service delivery protest or wage strike, and – if the annual report is anything to go by – spent the rest of its time on less pressing social issues.

Sasria collected just more than R2.4 billion in premiums during the year to March 2020, a satisfactory increase of 11% compared with the previous year. It paid out fewer claims than in the previous year, with claims decreasing to R992 million compared with nearly R1.6 billion in the 2019 financial year.

This enabled Sasria to spend R113 million on salaries and another nearly R10 million on staff training. It also transferred R43 million to the community by way of socio-economic development.

There was also no pressure on the investment advisors to work too hard: they stuck 71% of the investment portfolio in low-risk cash and near-cash assets, which yielded a low return.

R992m vs R20bn

The R992 million in claims paid out in the 2020 financial year – the 2021 annual report is due soon – is a drop in the ocean compared with the potential claims Sasria is facing now.


The damage by the widespread looting and destruction in KwaZulu-Natal and parts of Gauteng is estimated to be as high as R20 billion or even R30 billion. 


The SA Property Owners Association (Sapoa), which represents over 800 organisations in the commercial property sector, with 90% of the nation’s commercial real estate owned by its members, estimates the damage at more than R20 billion.

It says it has collated figures showing that some 800 stores have been looted and/or severely damaged while 100 malls have been either burned down or have suffered significant fire damage. A number of distribution centres in Durban have also been looted, with serious structural damage.

Sapoa president Andrew Konig quoted from estimated figures supplied by the eThekwini Economic Development and Planning Committee, stating that:

  • Some R1.5 billion has been lost in stock;
  • Property damage exceeds R15 billion;
  • Over 50 000 informal traders have lost their livelihoods; and
  • Approximately 1.5 million people have lost their potential to earn an income.

There are also some 150 000 jobs at risk.

Konig says the overall result of the past five days of devastation is an estimated loss to GDP upwards of R20 billion.

Sapoa estimates that the repair and reopening of a mall that has been burned down is likely to take at least two years, while those that have suffered less structural damage may still take a couple of months to reopen. 

Sasria has publicly estimated the damage at anything from R3 billion to R10 billion. An earlier report quoted Masondo as saying that damage could amount to between R3.5 billion and R7 billion, while he said in a later interview with Reuters that damage could be as high as R10 billion.

Coincidently, he also mentioned that Sasria will be able to settle claims of up to R10 billion with its “own balance sheet”.

Masondo later said that damages could be as high as R12 billion.

While it is impossible to tell how much of the damage is covered by insurance and how many policies include Sasria cover, the figures suggest that Sasria might be swamped. 

Sasria describes itself as the primary short-term insurer in SA, providing cover against special risks such as civil commotion, public disorder, strikes, riots and terrorism.

It notes in its marketing material that cover is needed as seen by recent increases in service delivery protests, student protests and labour strikes, as well as the increase in international terror incidents.

However, it is unlikely to have expected damages on the scale seen over the last few days.

The annual report states that Sasria has assets under management of R8.5 billion as at the end of March 2020, and disclosed an equity value of R6.9 billion.

Claims of R10 billion would be likely to bankrupt Sasria if it was a traditional private sector insurer.


The financial statements create the impression that Sasria has inadequate reinsurance cover.

In 2020, it recovered only R592 000 from R992 million paid in claims from reinsurance.

Masondo said in his report to stakeholders that Sasria’s approach is to determine what size of catastrophe it will be able to withstand.

“The worst-case scenarios or catastrophes have been calculated as part of Sasria’s own risk and solvency assessment and therefore our target is set at 230%.

“We are committed to standing behind all South Africans in protecting them from harm in terms of the perils which we are mandated to cover.”


Masondo was not available to confirm the limit of R500 million applicable to a single claim, but it seems high enough to cover the majority of claims in full if one considers that every shopkeeper in a mall will be able to submit a claim. However, some big malls might be exposed.

Lisa Swaine and Maria Philippides, partners at law firm Webber Wentzel, warn that businesses seeking to recover losses need to act quickly in filing claims to Sasria.

“If Sasria cover is in place, depending on the extent of the cover obtained, your business might be insured against the risk of loss or damage to its tangible assets, goods in transit, money, vehicles, construction works and construction plant and equipment, as well as specific consequential business interruption loss,” say the lawyers.

They list a few important things that affected business owners need to consider:

  • Time is of the essence. Your insurance broker must be notified of your claim, if not immediately, as soon as possible, so they can notify your insurers. Sasria must be notified within 30 days of the broker receiving the claim from the insured party.
  • Start gathering the evidence. The fact that the entire country has been affected by these acts of vandalism, riots, public disorder and civil commotion does not mean that you can take your claim and loss as a given. You need to prove your claim and that it falls within the cover provided by your Sasria policy. Photographic and video footage evidence of the incidents, if available, must be obtained and preserved.

Santam said that by close of business on Wednesday (July 14), it had received 21 vehicle-related claims and 167 other claims for damage due to the looting and unrest.

“At this stage we are unable to provide a monetary amount for these claims as the loss adjusters must still determine the extent of the loss for each claim,” it said in a statement released late on Thursday afternoon, urging policyholders with Sasria cover to register claims with their intermediaries or directly with Santam as soon as possible.

Sanlam indicated that it is engaging with Sasria to ensure that claims are handled as quickly as possible.



Picture source: facebook
Written by Adriaan Kruger 16/07/2021
Article featured in Moneyweb

South Africa’s demerit point system and your short-term insurance – what you need to know

For most drivers, there can be nothing more annoying than a reckless driver that dangerously cuts in front of you, accelerates through red robots or drives facing oncoming traffic.

This is the reality for drivers in South Africa’s towns and cities but that may be a thing of the past should authorities properly enforce the upcoming demerit system.

This is because one of the implications for drivers is that they could potentially lose their driver’s license for committing road traffic infringements.

Not only could this leave you, or an employee of your company, not able to drive, but it could potentially influence your short-term insurance.

With the new Administrative Adjudication of Road Traffic Offences (Aarto) Amendment Act due for implementation on 1 July, these are stark realities that individuals and employers will have to be aware of.

That is because the Aarto Act includes a demerit system whereby a person, operator or company juristic person, will not only pay a fine but will also incur demerit points when a traffic infringement is committed.

This could ultimately lead to one’s driver’s licence being suspended or cancelled or, complicate the employment of an individual hired explicitly to perform a driving function.

The demerit concept

The concept of a demerit point system to encourage drivers to abide by traffic laws might be new to South Africa, but it is an established practice internationally. Countries such as Australia and the United Kingdom have long had such systems in force.

As much as it has not been implemented yet, South Africa’s demerit system was signed into law in September 1998 already as part of the Aarto Act, Act 46 of 1998.

How will the point system work?

Once the system is implemented drivers will start with zero points. For every infringement – which includes laws regarding the roadworthiness of a vehicle – demerit points will be allocated.

For example, the published guidelines state that if a brake light is not working on the vehicle, one demerit point will be allocated, as well as a fine of R1,000.

Some infringements can lead to up to six demerit points. The full schedule of the more than 2 500 separate charges can be viewed in the Aarto Act.

Drivers will be allowed to accumulate a maximum of 15 demerit points over a three-year period. Learner drivers, however, will only be allowed a maximum of six points.

Should a driver exceed this number, their licence will be suspended for a period of three months. If you drive while your licence is suspended, you will be subject to a fine or even jail time.

The good news is that demerit points decrease by one point every three months. This means that drivers can work their way back to zero points over time.

A licence may be suspended twice, but on the third instance, the licence will be cancelled. The person will then have to apply for a new learner’s licence and driver’s licence.

Company vehicles and the Aarto Act

When it comes to a vehicle belonging to a company, the Aarto Act is clear as to how the demerit system will work.

The Act states that companies must keep an accurate record of who the driver of a vehicle is. Should a traffic infringement be recorded, the company must then ensure that the demerits accrue to the correct person, and not the person who is appointed as proxy for the vehicle.

This does mean, that even if you drive a company vehicle, you will also accrue demerit points against your driver’s licence should you incur an infringement.

Although there is no clarity as to how employers will be able to access the point status of employees, the Aarto Act is very clear in that an employer can be held responsible if it allows a person whose licence has been suspended, to operate one of its vehicles.

Concerning the roadworthiness of a vehicle, the company as the owner of the vehicle will be held responsible, and demerit points will be issued against the licence or operator disc of the vehicle.

The vehicle can therefore also accrue demerit points to the extent that it is not allowed to be operated by any person for a stipulated period of time. It is therefore important that the company (as the owner of the vehicle) and the employee (as operator) ensure that company vehicles are roadworthy at all times.

The Aarto Act and your short-term insurance

All companies offering short-term car insurance require that drivers of insured vehicles must have a valid driver’s license. The risk of a client clearly changes if a license is suspended or withdrawn and it will be the client’s responsibility to update his/her insurance accordingly.

This will mean that although short-term insurers will still insure the particular vehicle, they will not honour any accident or damage claims where a driver of that vehicle was driving while his or her driver’s license was revoked or suspended.

Given the introduction of the Aarto Act, insurers might also consider additional conditions and/or excesses should a driver exceed a certain number of demerit points.


Pictures by Pixabay
Article by Wilma van der Walt, executive at PPS Short Term Insurance
Featured in Buisnesstech on line

Financial Advice For Small Business Owners

How to succeed as a small business in South Africa

In a country where over 30% of the population is unemployed, the need for small to medium-size businesses (SMEs) to succeed is critical. Many SMEs are on a long journey of financial recovery which may be somewhat tenuous given ongoing load shedding, the state of the economy, and a highly stressed tourism industry.

While SMEs are generally innovative and can quickly bring new ideas to the market, they also face significant challenges which include start-up funding, managing expenses until profitability is reached, and surviving through uncertain economic conditions. It is generally accepted that the first five years of business can be the most difficult, with stats revealing that 50% of small businesses fail within this period. One of the main reasons is a lack of upfront and ongoing financial planning.

Starting a new business or setting your business on the road to recovery can be challenging, but with smart money management and careful strategising, it can be done. Here’s our best advice for South African entrepreneurs.

Have a plan

A business plan is the foundation of your entire venture and is the platform on which your whole business will be built. When compiling your business plan, ensure that it includes a detailed financial plan that includes product funding, budgeting, loan repayments, cash flow, salaries, risk management, sales projections, profit margins, and break-even points. With the benefit of hindsight, make sure you have a disaster recovery plan for your business.

Choose the correct business entity

When setting up your business, seek advice on the most appropriate business entity for your purposes. In general, you have the option of setting up a private company, sole proprietorship, partnership or business trust. Each of these entities has different advantages and disadvantages in respect of ownership, personal risk, tax, and administrative complexity. It’s best to weigh up your options with an expert. Once you have established your business, you will need to register it with the Companies and Intellectual Property Commission (CIPC).

Keep your personal finances separate

Regardless of the entity you choose, it’s best to keep your personal finances and business finances separate. This will make your bookkeeping easier, but it is also essential for your protection, tax planning and protecting your personal assets. It will allow you to maintain your good personal credit score while building up the business’s credit record.

Over-estimate your set-up costs

The most common feedback from start-up business owners is that they wholly underestimated the set-up costs and the time it would take to start generating real profits. Our advice is to do your costings and projections conservatively using a ‘worst-case scenario’, and then build in extra just in case.

Get tax advice

As a business owner, it is important to be aware of the tax obligations of running a business, bearing in mind that the entity you have chosen for your business will have different tax consequences. Different tax compliance rules, tax incentives and tax rates apply to different entities, and it is important to understand the difference at the outset so that you get it right the first time.

Learn basic accounting

Understanding basic accounting is a vital skill to have if you want to run your business properly. It is not necessary to have a financial background, but it is important to grasp the fundamentals of accounting. Depending on the nature of your business, you may want to install an accounting software package to make your life easier and your record-keeping on point.

Manage your cash flow

There are many hidden and unforeseen costs when it comes to setting up a business. Keeping a careful eye on your cash flow – both personal and business – is key. In the excitement of getting your business off the ground, it is perfectly possible to lose track of expenses. Our advice is to put a cash flow management system in place and monitor it every day.

Pay yourself first

Although this is one of the first rules of entrepreneurship, it is often the most overlooked. Many business owners feel compelled to put everything back into their business, while at the same time compromising their credit scores, insurability and personal finances. The ideal is to be able to draw enough from the business to cover your living expenses, medical aid, insurance and to service your personal debt.

Limit your fixed expenses

In the first few years of business, you will want to keep your fixed expenses at a minimum – although this may involve making some tough decisions. Many entrepreneurs choose to downgrade their accommodation, drive smaller and more cost-effective cars, forego eating out, and cutting back on the nice-to-haves. If you have a solid business plan and an unwavering belief in your product, these early sacrifices will be easy to make.

Stay on your medical aid

Remaining on your medical aid is imperative – even if you have to downgrade to a more affordable plan option. As a minimum, ensure that you have a hospital plan in place which covers your in-hospital at 100% of the medical aid tariff. In general, medical aid network options are more affordable. Ensuring no break in membership is essential to avoid future waiting periods or late joiner penalties. As and when your earnings increase, you will seamlessly be able to upgrade to more comprehensive cover.

Protect your income

Another important reason to pay yourself an income is to secure an income protection benefit in the event of permanent or temporary disability. According to FMI, 70% of South Africans will, in their working lifetime, have an injury or illness that will prevent that from earning an income for at least 7 days. An income protector effectively insures your earnings should you become ill or disabled. In the event of a temporary disability, your income can be protected for up to 24 months, whereas in the event of a permanent disability, your income will be protected to age 65.

Consider business overheads protection

If finances allow, consider insuring your business overheads. Business overheads protection is effectively insurance for your business which provides a temporary source of income should you be unable to work through illness or disability. This cover will ensure that your business can continue to operate even without your contribution to the business, and will cover the costs of specific business-related expenses while you are incapacitated.

Avoid lifestyle creep

As your business starts to generate profits, you may be tempted to begin living a less frugal lifestyle by upgrading your living arrangements, buying a new car or splashing out a little. Sue’s advice is to avoid being lured into a false sense of security. If your business is going well, use your earnings to pay off loans, set up an emergency fund and enhance your offering. If you can increase your drawings from the business, consider setting up a retirement annuity, moving on to a more comprehensive medical aid, setting up a personal emergency fund and investing in yourself.

Being an entrepreneur is more than a full-time job, and having to juggle finances as well as marketing, business development, HR and everything else can feel overwhelming. With these tips, you can be sure that keeping on top of your finances is one less thing to worry about.

 For assistance with bespoke Business Insurance solutions, specifically tailored to your individual risk profile -
Click Here

Pictures by Pixabay and Pexels
Article by Sue Torr from Crue Invest
Featured in (inspiration on the go)

What I wish I knew about insurance when I was younger

If you are starting your career, you may be thinking about getting insurance to protect your possessions. In the spirit of Youth Month, to help you avoid insurance pitfalls that can cost you dearly as a young professional.

Receiving your very first pay cheque as a young working professional can be a liberating yet daunting experience. Imagine the pride of buying your first car, a pair of name brand sneakers, a designer watch or the newest smart phone with the money you have earned. Adequate and comprehensive insurance policies are key to protect these possessions.

Anything valuable and considered an asset, can be insured.

The feeling of buying the thing that you worked so hard for is priceless, but there is a very real risk of loss in today’s world, so it is important to remember that as you step up and step out of the home, that you look after that which you have worked hard to get.

Below are five lessons to be learnt about insurance, before starting your career – both good and bad.

1. Understanding the terms & conditions of your policy

Insurance is there to protect you when things go bad; so, it is very important to firstly, make sure you get insurance, also ensure you understand your policy schedule and the policy wording when you buy a policy.

If you don’t, or if you don’t take the steps to make sure you are properly protected, you must accept that if you experience a loss, such as with a car accident or your smartphone is stolen, you will still be liable to pay monthly instalments, but won’t necessarily have the item anymore.

If you have insurance, understanding the terms & condition of your policy is important. You must be aware of what you are NOT covered for and having the cheapest cover is not necessarily always the correct approach. Value for money and peace of mind when you need it most is critical. The cheapest cover available may come with consequences.

“For example, the insurance with the lowest monthly premium may mean a very high excess at claim stage. Or worse, if you experience a loss, only then do you find out that you are underinsured. If you want to save money in the short-term, understand that it may cost you at claims stage if you have an inferior product.”

2. Do your homework and due diligence

This is why it is important to take the time to make sure you understand your insurance policy. A vital question to ask, is whether the sum insured will adequately cover you to replace or repair your belongings in an event of a claim and put you back in a similar position prior to the loss.

It is a good habit to annually check with your insurer that your assets are correctly insured.

“To avoid being underinsured when claiming, do an annual assessment as you scale up your possessions. As we upgrade to smart living in this digital world, take a picture of the receipt and send it to your insurance company or broker, or upload it on your insurance app, so that they can add it to your policy. Use the digital inventory calculators to update the cost of your insurable assets, it is essential that you keep updating the list of assets that you have with your insurance provider.

You will also need to check with your insurer that they adjust your premium on those items which as items depreciate. For example, motor vehicle premiums.

“Many insurers now do this automatically without you needing to check in with them, so it is worthwhile to confirm this as part of your due diligence.”
To add to this, it is important to know that the more you claim, the more expensive your premium may become.

3. Consider top up or add-on products to protect you

If you recall your very first car purchased – Probably a Toyota Tazz or equivalent back in the day, – which was an easy choice because it was in high demand and would be relatively cheap to maintain.

If it was financed, you were not allowed to drive it out the dealership without having good comprehensive vehicle insurance. The dealership salesman would recommend that you take top up cover or credit shortfall cover, to protect you if there was ever an insurance claim. If you accepted without giving it much thought; little did you know at the time, that this would be one of the best decisions you would ever make. If you car was ever stolen you would discover there was a hefty shortfall to pay, but the top up insurance cover could potentially save you from a further financial loss.

Below are some lessons learnt from our experience when purchasing your first vehicle insurance:

• Ensure your vehicle is insured on retail value basis – which is the value you would expect to buy the vehicle from dealer floors.
• Ensure all optional extras added to your vehicle are noted
• When checking your affordability for a new vehicle, remember to factor in insurance cost. Most first-time vehicle buyers forget to factor in fuel and insurance cost on their budget when the plan to buy a new vehicle

4. Insurance protects you when life happens

When starting your career and  building or buying a home, “content and structure insurance is necessary to cover you for things such as burst geysers, mechanical breakdown of appliances like a fridge or a washing machine, giving you peace of mind.”

5. As you step up and step out of your home, protect your personal belongings

As a caution, insuring assets and the concept of insurance, is not a “get rich quick scheme”; the purpose of insurance is to put you back in the same position as you were prior to a loss, relieving you of financial burdens.

It is critically important that as young professionals progress in their career, to protect the goods that you acquire and step out of the home wearing and on your person.
Name brand sneakers, spectacles, a fancy watch, an expensive smartphone… in many cases is not far-fetched to assume that you step out of the house wearing items which are indeed valuable. Ask yourself what will happen should either of these items get damaged, lost or stolen?

Handbag insurance has been pivotal to protecting against loss. (unspecified all risks)
If your insurer has handbag insurance, opt for this as it means you are covered without needing to specify items like perfumes, make up, expensive pens, etcetera. Should you lose or misplace your personal belongings, you should be covered.
Another option is All Risk cover, however there is a limit to how much your insurer will cover when it comes to your all risk cover, which covers those items which you use away from your home or on your person, like laptops and mobile phones.

As you progress in your career, your personal brand will also evolve and your taste for more expensive things in life will grow; it is important that you match your insurance cover accordingly.

For assistance with your short term insurance CLICK HERE


Pictures by Pixabay
Article courtesy of Antonia Oakes, Retail Executive of customer experience & responsible business at Old Mutual Insure
Featured in FANews

5 useful tips to prevent falling victim to remote jamming

Remote jamming is the practice where thieves jam the signal from the immobiliser to the car so it does not lock even when the owner presses the ‘lock’ button.

Most vehicle and gate remotes operate on the same frequency, making it easier to interfere with the signals. Thus, a driver will be under the impression they’ve locked their vehicle while they haven’t. This often happens outside of shopping centres, airports or other places of interest.

Avoid the trauma that comes with being a victim of remote-jamming, by adopting the following safety tips when exiting your vehicle:

* Firstly, make sure your vehicle is properly locked. Don’t just press your vehicle alarm and walk away. Always make sure by testing to see if you can open your vehicle door after activating the alarm.

* Always be aware of your surroundings and be aware of suspicious individuals lingering around the parking area.

* Listen for the sound that your car makes when it locks. Wait and watch the car lights flash to indicate it is locked. Physically try to open your door to ensure it doesn’t open before walking away.

* Park as close to the entrance of the shopping centre as possible as there are always a lot of people and movement in this area, or in the full view of a camera. Having said that, many criminals are brazen, so be aware of activity around you.

* Report suspicious-looking people to security or move your car to a safer place.

Phone your Insurer or Broker to check whether you are covered for remote jamming.
For any assistance please visit our website

images by Pixabay

The effects the new drunk driving law will have on car insurance

Once South Africa's strict new drunk-driving laws come into effect this month, no one will be allowed behind the wheel of a motor vehicle after even one drink.

Currently, it’s still legal to get behind the wheel if your blood-alcohol level is under 0.05g per 100ml. The new National Road Traffic Amendment Act totally prohibits the consumption of alcohol by all motor vehicle operators on South African public roads by setting the legal blood-alcohol limit for drivers at 0%.

This has serious implications for South African drivers. If you’re involved in an accident after having even a single drink, you won’t just find yourself on the wrong side of the law, but it can also have a major impact on your insurance,

Insurers have the right to refuse to pay accident claims if the driver’s blood-alcohol level is over the legal limit. This clause is included in almost every car insurance policy in South Africa. Previously, it was difficult to determine whether people were over the legal limit and whether their driving ability was impaired. The new zero-tolerance approach removes this grey area.

If you break the law by driving after drinking, your insurer has no obligation to meet your claim.

If you’re guilty of this offence, it’s also likely that your premium will increase significantly, as you’ll be considered a higher risk. In the worst-case scenario, if you’re convicted of drunk driving or have your licence endorsed or suspended, your current insurer may cancel your policy, and you may find it difficult to get car insurance at all in future.

While the new law will potentially reduce the number of accidents caused by drunken driving, it won’t immediately affect premiums. If we see fewer accidents due to fewer drunken driving incidents in the longer term, though, we may see premiums coming down due to lower claims costs for insurers.

The new law won’t see existing policies being altered, as most policies already stipulate that drivers must abide by the law. Therefore, the 0% legal blood alcohol limit will apply as soon as the new law comes into effect.

The bottom line? If you’re going to drink, make sure you have alternative transport.

To access and download the National Road Traffic Act regulations amendment click here

Pictures by ES Brokers private client and Pixabay
Written by Wynand Van Vuuren
Article featured in Bizcommunity

Home Insurance explained | A first-time buyer’s guide to comprehensive cover

South Africa's property market is being driven by an influx of first-time buyers as the historically low interest rate makes it more affordable to buy property rather than rent.

Homeowners insurance is mandatory to qualify for a bond as it covers the financial institution’s investment. One of the factors determining the monthly premium is the replacement value of your property. Most financial institutions offer this coverage, however, it is advisable that you shop around for an offer that suits your needs and your pocket best. 

It is important to note that homeowner’s insurance, otherwise known as building insurance, does not cover the contents of your home. Therefore, you will need to also apply for home contents insurance should you wish to insure your personal possessions.  

Everything inside a house that can be taken with you the day that you permanently move is known as its contents, and everything that is fixed - from any built structure like the main dwelling, garage, walls and fences to fixtures like an air-conditioner, pool pump, intercom system and geyser – will be covered under building insurance. Most insurance companies will offer reduced insurance premiums if you combine your home contents, vehicle and building insurance. Click here to understand the benefits and save money. 


Get a quote on combining your building and home contents insurance and save. 

If you’ve found your dream home, then there are some strongly advisable checks you should consider conducting, prior to putting in an offer to purchase.

Marius Steyn, Personal Lines Underwriting Manager at Santam – SA’s leading short-term insurer - suggests conducting a home inspection prior to purchase, then putting in a clause that an offer to purchase is subject to stipulated repairs.

“Remember, your insurer is only responsible for damages occurring from the date of registration of your new home at the deeds office, onwards – not for any prior problems. This means you need to have any damages fixed by the seller, as a condition of your offer. Otherwise, these could become big issues down-the-line.”

Conduct a home inspection prior to purchase, then put in a clause that an offer to purchase is subject to stipulated repairs.

So, what essential checks should a first-time buyer conduct?

You need to know your property is structurally sound, safe, damage-free and up-to-code. Remember, you are fully entitled to include a home inspection clause in your contract, which makes your offer conditional on a home inspection being conducted and the property being found to be in a satisfactory state. However, it’s worth noting that including this clause can sometimes make an offer less desirable for a seller – especially one who knows there are things that need fixing!  


Here are five areas of the home to potentially focus on: 

1.    Check the geyser: Have the geyser inspected by a registered plumber in order to establish the general condition and the adherents to regulatory requirements. The general replacement cost of a standard size geyser amounts to approximately R8 500. When bursting or leaking it has the potential to wreck a room, so you need to be sure you’re getting one in tip-top condition.

2.    Check the roof: Are the tiles cracked? Have the roof inspected by a registered builder to determine the general condition of the roof. The state of a roof and gutters can indicate a lot about the general maintenance of the home as a whole.

3.    Check the ceiling: Most ceilings have secrets. Look especially hard for mould, or maybe fresh paint jobs to hide said mould or damp.

4.    Check the garden: If this is lush and green, be careful. How much will you need to spend to maintain it? Is it drought-friendly given certain parts of SA’s ongoing water issues?

5.    Check for electrical faults: Electrical faults will be identified with the issuing of the electrical certificate, which is the responsibility of the seller. Any repairs or shortcomings identified in this investigation would also be the responsibility of the seller.

Steyn advises having a professional inspection and taking a family member or friend along, who has experience and knowledge in spotting potential structural problems.

A few insurance considerations  for first-time buyers:

1.    Make sure you get homeowners insurance (this covers the building) and house contents insurance (this cover the contents within your home) a few days PRIOR to moving in. Your first seven days in a new house are when you’re most vulnerable, because you’re usually still figuring out security and all your things are in boxes. So, make sure your insurance is already in place. You can also request to have certain security features installed before moving in – especially those that are essential to meet your insurer’s stipulated conditions – like burglar bars, an alarm, etc.

2.    Make sure your home contents insurance is adequate and the equivalent to the new current replacement value of all your items.

3.    Remember you have a duty of care as the policyholder. Should a theft occur, you need to do everything you can to limit the damage – so ensure your front door is fixed and secure if it was damaged through forced entry, for example. Additionally, report any items stolen to the police and your insurer. With the approval of your insurer you do have a prescribed time to do a proper inventory of everything taken.


It is importance to making sure that all damage is fixed up before you move in, as a condition of your offer.
Do not purchase a property (home) with damage. Rather include a clause in the purchase contract that seller must repair the specified damage before registration can take place.

For assistance with your Home and building insurance phone 031-5021922 or click here to go to our website.


Article courtesy of Property24

Why Luxury properties should be insured by specialist insurance brokers

A surge in the number of high net worth individuals (HNWIs) living in Africa is set to inflate demand for prime properties in sought-after South African destinations.

“South Africa is perfectly positioned to benefit from the rise in Africa-domiciled HNWIs thanks to our relatively stable economic and financial environment as well as magnificent residential properties on offer,” says Christelle Colman, MD at Elite Risk Acceptances, a subsidiary of Old Mutual Insure.

The Wealth Report 2021, published by global real estate firm Knight Frank, forecasts a 139% growth in African households earning more than US$100 000 per year between 2020 and 2025, by which time there will be more than 63 400 HNWIs living in South Africa alone.

Another global survey by Luxury Portfolio International reveals that as many as half of HNWIs are planning to buy at least one extra luxury property in the coming 12 months, compared to just one-in-five at the start of 2020. Many of these buyers are choosing South Africa to invest in.

But the rise in demand for prime properties is already being seen in the latest property data.

Seeff Property Group, which recorded its highest-ever South African sales in March 2021, says that one-in-three high value properties are being snapped up by foreign buyers. Seeff reported a 36% jump in sales to such buyers across Cape Town’s Atlantic Seaboard and City Bowl areas in Q1 2021. Transactions included a R45 million penthouse at the Waterfront, a R36 million property in Fresnaye and a R20 million house in Upper Constantia. Similarly, Frankie Bells real estate also says luxury homes are back in demand in South Africa. The property group is seeing an increased demand in the northern suburbs of Gauteng, southern suburbs of Cape Town and eastern and southern coastal regions.

Furthermore, New World Wealth estimates that over 45% of SA HNWIs either live or have homes on estates. An additional 30% have homes in luxury apartment blocks (which have been the fastest growing residential segment in SA over the past 20 years in terms of price growth).

As the demand for ultra-luxury SA homes skyrockets, buyers who are in the market for high value properties should not underestimate the importance of insurance when signing on the dotted line.

Assets with high price tags present unique risks to their owners. There are a number of insurance missteps that the wealthy make, which can cause huge problems at claims stage.

Properties with expensive price tags should be insured by specialist insurance brokers and underwriters with extensive local knowledge and strong financial backing. Selecting an experienced risk partner is seen as the first step that HNWIs should take to avoid the many insurance pitfalls in the ultra-luxury home segment.

The most important aspect of buildings insurance is to value the asset at its correct replacement cost, because failure to do so can result in the asset being severely underinsured and the insurer applying ‘average’ at claims stage.

A 20% underinsurance on a R20 million home could leave the insured R4 million out-of-pocket in the event of a total loss. Insuring the property at too high a value has consequences too, as the insured will end up paying higher insurance premiums, but only be paid the correct actual replacement value in the event of a loss.

Luxury homes must be insured at their replacement cost, not the market value. The insured value must include the cost of rebuilding the primary building and outbuildings; restoring any landscaping features; and to provide for costs such as professional fees and site clearing, to name a few. A common error made by international investors when insuring local property is to assume that rebuilding and replacement costs will be similar to those experienced in their home countries.

Foreign buyers may also be unaware of the challenges that their properties present insofar rebuilding, due to location.

Expert local knowledge such as the ability to source and cost specialist construction contractors and high-end materials are essential when placing luxury homes on cover. A large portion of the purchase price of luxury homes is linked to location and that it is not uncommon for prime properties to change hands for amounts far in excess of their replacement cost.

Approaching an ill-equipped insurer to place a luxury home on cover can be as devastating as making errors on the sum insured.
A specialist insurer who understands the luxury property segment is best-placed to assess your asset values and offer you a competitive, risk-appropriate premium, with no unfortunate surprises at claims stage.

For assistance any with advice and expertise on your luxury home insurance please contact us on 031-5021922 or visit our website


Picture source: Pixabay
Article by
 MoneyMarketing on June 4, 2021 in Financial Planning, Insurance, News, Short-term Insurance, 


7 Business Risks Every Business Should Plan For

Building a business takes work—and risks. But some risks are more dangerous than others. Here are a few risks that every business owner should keep in mind. 

Running a business takes hard work, which can reap the rewards of customers, revenue and satisfaction. While success is the ultimate goal, business risk may stop you from achieving the goals you set.

When it comes to risk management, there are steps you can take, however.

Here are seven types of business risk you may want to address in your company.

1. Economic Risk

The economy is constantly changing as the markets fluctuate. Some positive changes are good for the economy, which lead to booming purchase environments, while negative events can reduce sales. It's important to watch changes and trends to potentially identify and plan for an economic downturn.

To counteract economic risk, save as much money as possible to maintain a steady cash flow. Also, operate with a lean budget with low overhead through all economic cycles as part of your business plan.

2. Compliance Risk

Business owners face an abundance of laws and regulations to comply with. For example, recent data protection and payment processing compliance could impact how you handle certain aspects of your operation. Staying well versed in applicable laws from federal agencies like the Occupational Safety and Health Administration (OSHA) or the Environmental Protection Agency (EPA) as well as state and local agencies can help minimize compliance risks.

If you rely on all your income from one or two clients, your financial risk could be significant if one or both no longer use your services. Start marketing your services to diversify your base so the loss of one won't devastate your bottom line.

Non-compliance may result in significant fines and penalties. Remain vigilant in tracking compliance by joining an industry organization, regularly reviewing government agency information and seeking assistance from consultants who specialize in compliance.

3. Security and Fraud Risk

As more customers use online and mobile channels to share personal data, there are also greater opportunities for hacking. News stories about data breaches, identity theft and payment fraud illustrate how this type of risk is growing for businesses.

Not only does this risk impact trust and reputation, but a company is also financially liable for any data breaches or fraud. To achieve effective enterprise risk management, focus on security solutions, fraud detection tools and employee and customer education about how to detect any potential issues.

To find out more about Cybercrime insurance
click here:

4. Financial Risk

This business risk may involve credit extended to customers or your own company's debt load. Interest rate fluctuations can also be a threat.

Making adjustments to your business plan will help you avoid harming cash flow or creating an unexpected loss. Keep debt to a minimum and create a plan that will start lowering that debt load as soon as possible. If you rely on all your income from one or two clients, your financial risk could be significant if one or both no longer use your services. Start marketing your services to diversify your base so the loss of one won't devastate your bottom line.

5. Reputation Risk

There has always been the risk that an unhappy customer, product failure, negative press or lawsuit can adversely impact a company's brand reputation. However, social media has amplified the speed and scope of reputation risk. Just one negative tweet or bad review can decrease your customer following and cause revenue to plummet.

To prepare for this risk, leverage reputation management strategies to regularly monitor what others are saying about the company online and offline. Be ready to respond to those comments and help address any concerns immediately. Keep quality top of mind to avoid lawsuits and product failures that can also damage your company's reputation.

6. Operational Risk

This business risk can happen internally, externally or involve a combination of factors. Something could unexpectedly happen that causes you to lose business continuity.

That unexpected event could be a natural disaster or fire that damages or destroys your physical business. Or, it might involve a server outage caused by technical problems, people, or power cut. Many operational risks are also people-related. An employee might make mistakes that cost time and money.

Whether it's a people or process failure, these operational risks can adversely impact your business in terms of money, time and reputation. Address each of these potential operational risks through training and a business continuity plan. Both tactics provide a way to think about what could go wrong and establish a backup system or proactive measures to ensure operations aren't affected.

The services of an Independent Insurance Broker is crucial, as they can help mitigate these risks though a tailor made insurance policy, drafted specifically for your needs and requirements. To have direct access to a broker in your area
click here:

7. Competition (or Comfort) Risk

While a business may be aware that there is always some competition in their industry, it's easy to miss out on what businesses are offering that may appeal to your customers.

In this case, the business risk involves a company leader becoming so comfortable with their success and the status quo that they don't look for ways to pivot or make continual improvements. Increasing competition combined with an unwillingness to change may result in a loss of customers.

Enterprise risk management means a company must continually reassess their performance, refine their strategy, and maintain strong, interactive relationships with their audience and customers. Additionally, it's important to keep an eye on the competition by regularly researching how they use online and social media channels.

Accept, But Plan

Although you will never be able to completely eliminate business risk, proactively planning for it can help. Awareness is key in helping you save money and time while protecting the trust, reputation, and customer base you've worked so hard to achieve.

For assistance with your risk management and insurance solutions you can call 031-5021922 or visit our website


Photo’s by: Pixabay

By John Boitnott

Writer, Business Trends & Insights Contributor

Featured in American Express