Everything you need to know about non-life insurance in South Africa

South Africa’s commercial #InsuranceBrokers are facing an exclusion-based policy wording dilemma; but a solution may be in sight.   Inconsistent exclusion wordings across SA’s #Underwriting environment is causing a headache for brokers, their clients and the broader short-term insurance sector.   📊 Stokes Media's latest Broker Perception Survey (published in the fourth edition of Everything you need to know about non-life insurance in South Africa) highlights the urgency of a unified approach.   The argument goes that consistent wordings will avoid confusion and clarify complex exclusions, especially around potentially #SystemicRisks like #GridFailure and #Pandemic.   🔍 One broker noted, “If brokers and insurers aren’t aligned on policy wordings, where does that leave clients?”   The issue headlined the Financial Intermediaries Association of Southern Africa (FIA) 2024 Advice Summit, with FSCA South Africa’s Makgompi Raphasha proposing a collaborative solution - without tripping up over competition law.   But will the Competition Commission allow this? And can unified exclusion wordings finally bring clarity?   Share your thoughts below or dive into the full FAnews Magazine-Online write-up here: https://lnkd.in/dDu7SHAx   #InsuranceSolutions #BrokerInsights #SouthAfricaInsurance #PolicyClarity #NonLifeInsurance #PolicyWording #InsuranceContract

#Inflation seems under control, but it is still way too soon to be celebrating an aggressive interest rate cut. The news that headline inflation dropped to 3.8% year-on-year in September 2024 will offer some respite to South Africa’s long-suffering consumers, but not in the household budget categories that really count. Yes, average households will feel less of a ‘pinch’ when paying for goods and services; but regulated prices remain rampant, and debt servicing costs look set to stay higher for longer too. Why? Read on for more :) #Inflation #InterestRates #EconomicCycle #ConsumerPriceInflation #CPI #RateCuts

I am attending #FIASummit24 alongside hundreds of #FinancialServices professionals... The focus, as always, is on the valuable role played by intermediaries. If you're among the lucky attendees, be sure to get your copy of Everything you need to know about non-life insurance in South Africa ... a gift from Stokes Media to you. Thanks to Financial Intermediaries Association of Southern Africa (FIA) for another insightful event.

Helene and Milton could throw global commercial and residential #underwriting further out of kilter - and SA insurers were worried before these catastrophes struck.   The insurance landscape is evolving as risks like #ClimateChange, #Cyberattacks and grid failures challenge traditional models.   Globally, the rising frequency and severity of #ExtremeWeather events is on naked display again in 2024, especially in the US.   Quoted on CNN, CoreLogic estimated that #HurricaneHelene may have caused total property damage losses of around US$47 billion, with $20-30 billion being uninsured.   And the early estimates put insured losses following Hurricane Milton at $40-60 billion, meaning it will likely be the costliest #NaturalCatastrophe loss event in the US this year.   A week or two prior to these disasters, I penned an article focusing on the increasing difficulties faced by domestic underwriters in placing difficult or #SystemicRisk, including #FloodRisk.   In that piece, Bryte Insurance Company Limited notes, “In instances where location-based extreme weather events become predictable, these locations become uninsurable.”   And Ronald Richman, Chief Actuary at Old Mutual Insure, said that while local insurers can charge premiums in line with risks, "certain properties might become uninsurable due to flood or fire" over time.   As #RiskPools tighten, insurers are exploring alternatives like #ParametricInsurance and self-insurance models to ensure resilience in a hard market.   You can read the full write-up here: https://lnkd.in/dURatzKs   #GeneralInsurance #ClimateRisk #RiskManagement #CommercialInsurance #RiskTransfer

AI & Machine Learning are playing a more pivotal role in #Insurance, resulting in #Insurers and #InsuranceBrokers placing a more tangible value on their #Data.   This insight emerged during today’s Insurance Institute of Gauteng presentation, given by Denver Naidoo, Chief Data Officer atOld Mutual Insure.   This was an intriguing presentation, that I will soon explore indepth for FAnews Magazine-Online. As an appetiser, this summary of operational areas where insurers are leveraging data and #ArtificialIntelligence as an asset should whet your appetite:   1. #FraudDetection, AI is great at pattern recognition at claims and underwriting stages. 2. #ClaimsProcessing, using AI can speed up settlement processes and improve customer experience (#CX). 3. #PredictiveAnalytics, for unpacking customer behaviour and emerging trends. 4. #RiskAssessment, crunching vast amounts of data for better #Underwriting outcomes. 5. #CustomerExperience, enabling an overall improved experience between insured and insurer.   On this short sub-set of the presentation, I conclude: As the insurance landscape evolves, firms deploying AI and Machine Learning into their data strategies will lead the way in delivering more efficient, personalised insurance solutions.   #DataDriven #MachineLearning #InsuranceInnovation #TechInInsurance #AIInsurance #DigitalTransformation

SA’s non-life motor insurers perform heroically in covering local motor vehicle owners from losses due to hijacking and theft ... a feat worthy of praise given the domestic crime landscape is tough, and worsening.   The extent of the problem was on display during the opening sessions of the recent #InsureTalk46 even, staged by CN&CO and hosted by Christelle Colman (FIISA) of Ami Underwriting Managers (Pty) Ltd.   First up, David W. Chow of Bryte Insurance Company Limited shared some staggering SA crime statistics.   In Jan to March 2023, 5119 vehicles were hijacked; with 37400 vehicles stolen in the latest year.   Chow estimated that the financial cost of motor vehicle crime now exceeds R8.5 billion annually ... with big chunks of that picked up by non-life insurers.   Louwrens Liebenberg of the Insurance Crime Bureau followed up, sharing some frightening videos to show how easily modern vehicle security systems can be compromised.   For some context, around 70% of South Africa’s motor pool remains uninsured... So, you should not be surprised when your #insurer ups your #insurancepremium; increases your theft excess; and . or demands additional security measures on that new double cab.   I will be covering these presentations in greater detail in an upcoming FAnews Magazine-Online newsletter, so keep your eyes peeled.   #VehicleTheft #InsuranceHeroes #RiskManagement #AutoTheft #SAICB #FinancialImpact #ConsumerAwareness

Kidnap and ransom is becoming a big problem in South Africa, leading to questions over whether you should add cover for this risk to your short-term insurance policy.   One of the scariest evolutions in the criminal ‘space’ is the emergence of so-called #ExpressHijackings, where criminals take the victim to an ATM and force them to withdraw cash, sometimes even transferring funds between accounts to steal the maximum possible amount.   My latest article, penned for FAnews Magazine-Online, is based on a one-on-one interview with Catia Folgore, Product Head: Crisis Management at iTOO Special Risks (Pty) Ltd. Together, we explored the evolution of this important cover type.   “When we first started looking at #kidnap and #ransom, it was mainly a commercial cover for companies that were sending their employees into high-risk countries; now we offer the product to individuals too,” Fogore said.   Most families take out low limit, low premium policies, with a typical sum insured of R2 million. Premiums start at around R15000 annually, though there are significant variances based on individual underwriting and cover options selected.   Even so, the cover available to personal lines insureds is described as “very comprehensive for the amount of premium paid annually”.   An important takeaway from the discussion is that this policy gives you and your family access to the experts needed to help if the worst happens.   You can read the full article here: https://lnkd.in/d_Wdhpkv   #Insurance #RiskManagement #KidnapAndRansom #SouthAfrica #ExpressKidnapping #PersonalInsurance

Are you beginning to question your #GeneralInsurance cover or provider?   And have you, like your writer, recently fielded a call from your #InsuranceBroker to say: Sorry for you, but your #Insurer is no longer covering your buildings against <<insert peril here>>?   You are not alone; because there is a mega trend playing out, impacting both #PersonalLines and #CommercialInsurance.   Globally, insurers and #Reinsurers are grappling with how to balance coverage and sustainability. The result: many policyholders are left wondering about the appropriateness of their insurance contract.   The line of interrogation is fairly simple. Does the higher premium being charged make sense in light of the ever-expanding list of #RiskMitigation requirements and cover limitations and / or exclusions?   This week, your writer chanced upon a media release from a global reinsurer that has introduced the term "risk-adequate" to explain sustainable approaches to insuring… They contend that climate-driven losses; cyber risks; and claims inflation are shifting the re/insurance landscape ... and that means the aforementioned trend will gather momentum.   To find out more, you can read my latest contribution to FAnews Magazine-Online:   https://lnkd.in/db9jKjuX   #Insurance #Reinsurance #RiskManagement #ClimateChange #CyberSecurity #FinancialStability #NonLifeInsurance

If you want to understand why your #insurer / #InsuranceBroker are getting so tough on #InsurancePolicy coverage and exclusions, then these half-year results may hold some answers…   My latest FAnews Magazine-Online newsletter offers a peak into Santam Insurance's latest half-year results. South Africa's largest non-life insurer reported a 35% increase in headline earnings per share for the six months to 30 June 2024 (versus the comparable 2023 half-year). The figures suggest resilience; but a closer look reveals an ongoing shift in risk from insurer to insured. Tougher #Underwriting actions – such as excluding certain perils and tightening risk criteria – are a direct response to rising claim frequencies and severities, especially from unpredictable weather events. Santam, like most other traditional #insurers and #reinsurers, is recalibrating its risk appetite to protect profitability. Is this a sign of the changing #RiskLandscape for domestic insurance? You can read more here: https://lnkd.in/d-iZRd3j   #Insurance #RiskManagement #Underwriting #FinancialResults #Santam #SouthAfrica Stokes Media Everything you need to know about non-life insurance in South Africa

One of the best ways to learn, is to listen to the subject matter experts you surround yourself with... In this case, my ‘lessons’ came courtesy the executives assembled for the 2024 CEO Round Table, organised by Insurance Institute of Gauteng and supported by iTOO Special Risks (Pty) Ltd.   I’ve written up some of the insights in a long-form piece for FAnews Magazine-Online, titled ‘Insurers challenged to shift focus from #RiskTransfer to #RiskMitigation’.   For something more concise, here are quotes from some of the insurance experts in attendance.   1) Tovè Sithole: "What if part of the insurance premium could contribute towards a solution to climate risk?" 2) Steve von Roretz of Leppard & Associates, emphasised the need to tackle water scarcity as part of risk management. 3) Graeme Codrington urged the insurance industry to shift from merely covering losses to actively preventing them: “There is a lot of opportunity across infrastructure.” Justin Naylor highlighted the critical role of new talent: "New generation talent is probably the biggest risk or disruptive force facing our industry." Junior John Ngulube called for a return to robust #SkillsDevelopment: "We must stop moaning about lack of talent and focus on creating it." Bukhosi Khumalo (AIRMSA, FIISA) of OLEA Insurance Solutions Africa warned of the risks of a talent vacuum: "You cannot transfer 40-years’ worth of knowledge in a single year." The consensus? Insurers need to rethink their role – from managing risks to mitigating them. The future of insurance hinges on talent, innovation and a proactive approach to risk.   Read the full story here: https://lnkd.in/dzg2_vZA   #Insurance #RiskManagement #TalentDevelopment #ClimateRisk #WaterScarcity #Innovation #Leadership #FutureOfInsurance #SkillsDevelopment #Infrastructure