The pandemic has had a big impact on interpersonal behaviour. While relationships and marriages have taken strain during the various lockdown levels and increased time spent at home, other relationships have thrived. People have spent more time with their pets than ever before, and pet adoptions have gone up too. This has driven new demand for Pet Insurance – with pet owners wanting the reassurance that if things do go wrong and their pet gets sick or injured, they’ll never have to decide between their finances and Fido’s health and wellbeing.
“For many pet owners, their pets are treasured family members, so it makes perfect sense to have a solution that takes care of their pet’s healthcare needs, in much the same way as people rely on medical aid in a health crisis,” explains Candice Hobday, a director of ARCO360, an equine and pet insurance brokerage offering GENRIC Pet Insurance.
“If things do go wrong and your pet gets sick or injured, you’ll want the peace of mind of knowing that you can afford any unexpected veterinary bills – and you will never be forced into an untenable decision because you cannot afford a big upfront cost. The premise behind pet insurance is that instead of having to pay a large upfront lump sum for veterinary treatment for your pet, you can rather pay a much smaller, more affordable monthly payment which will go towards the cost of any treatment your pet may need in future. In the current economic environment, not many people have access to large amounts of cash at short notice, and in a veterinary emergency, these amounts can be substantial,” explains Candice.
As the following claims illustrate, GENRIC’s pet insurance is emerging as an invaluable financial tool for pet owners to guard against unexpected veterinary costs, and to ensure that you will never have to decide between your finances and your pet’s health and wellbeing.
GENRIC Pet insurance claims1:
- Bane, the American Bulldog, got injured and required TPLO surgery on his back leg. Tibial Plateau Levelling Osteotomy (TPLO) is a surgical procedure used to treat cranial (or anterior) cruciate ligament rupture in the knee joints of dogs. Cranial cruciate ligament rupture is the most common cause of hind leg lameness in dogs. Bane’s vet bill for the surgery came in at an eyewatering R43 400. Fortunately, Bane’s owner was covered under GENRIC Pet’s comprehensive plan, and the insurance claim was paid directly to the vet at R39 100.
- Jiana, the Pomeranian developed hepatopathy and liver disease which required emergency treatment and hospitalisation. Liver disease is a common condition in dogs that can lead to seizures, coma, and even death if left untreated. The cost for treating liver disease in dogs can get very expensive and involves diagnostic tests, lengthy treatments, and medications. Jiana’s R15 600 vet bill was paid out by GENRIC Pet at R14 100.
- Nala the Bulldog developed a nasty ear infection and had to undergo surgery. The vet bill of R16 725 was settled by GENRIC Pet at R15 100, and Nala’s hearing is as good as can be!
1 These are some of the actual claims paid by GENRIC Insurance Company during Jun-Aug 2021.
² Based on a monthly premium of R348pm for GENRIC Pet’s Comprehensive Medical Expenses+ plan (2021 rates).
“It is evident that pet insurance is a non-negotiable part of any pet owner’s healthcare planning strategy for their furry family member. When you consider that a claim like Bane’s R40k TPLO surgery would be equivalent to around 9.5 years of pet insurance premium payments², the value and peace of mind provided is immeasurable in an environment where few pet owners can afford such a major financial knock,” explains Candice.
Just like in your life, a health crisis or injury and subsequent treatment costs can come at very unexpected times and price tags. Having pet insurance is a lot like health insurance for people. It protects your finances from the unknowns, ensures access to quality care and treatment, and from ever having to make an unthinkable choice due to financial constraints. And your pet will have access to the best treatments and latest veterinary technology, which usually means better health outcomes. “Your pet is likely to be part of the family, so if they are ill or injured, you need a solution that takes the pain out of unexpected veterinary bills, and never leaves you in a position where you have to choose between the unthinkable,” concludes Candice.
GENRIC Pet Insurance is not a pet medical aid.
Premiums may be reviewed and escalated on an annual basis.
GENRIC Pet Insurance is underwritten and administered by GENRIC Insurance Company Limited (43638). GENRIC Insurance Company Limited is an authorised Financial Services Provider and licensed non-life insurer. Please note that Candice Hobday is not additionally remunerated nor does this article constitute as financial advice.
My name is Bongani Nkosi, I am 28 years old and this is my story.
I currently live in Tembisa. I matriculated in 2010 at Jiyana Secondary School and afterwards decided to take a gap year. In 2012, I enrolled at the University of Johannesburg to obtain a bachelor’s degree in education, FET Phase. Unfortunately, in 2014 I had to drop out due to lack of funding and was unemployed till 2019.
I fell into a deep depression and felt like a failure. I could not provide for myself and my family as I had hoped when growing up. My self-esteem went from 100 to 0 because I was ashamed of how my life turned out. I was the first person in my family to go to University, and then I became an unemployed University drop out.
A friend from my high school told me about a Learnership opportunity at GENRIC Insurance Company Limited. She explained that I will receive a Short-Term Insurance Qualification NQF Level 4 on completion of the programme. I knew nothing about Insurance, but I knew that this was an opportunity of a lifetime and a chance for me to redeem myself. In September 2019, GENRIC invited me for an Interview. As I entered the room, I realised that there were about 26 other young and dedicated candidates. The interviews started and I was the third one to be interviewed and I knew I had to make a good impression. I got into the HR office where the interviews were taking place. The ladies introduced themselves and asked me to relax, and just be myself. The rest was history. As I walked out of that office, I could tell that they were very impressed. After everyone was interviewed, Ms Melanie Du Plessis announced the 20 individuals who qualified to partake in the Learnership Programme. After she called my name, I was so excited I could not hold it in. I called my family right away to share the good news with them. It was the breakthrough we’ve been waiting for. Finally, I would be able to obtain a qualification and get a decent job. I felt a sense of pride and my confidence was restored.
The learnership programme commenced from October 2019 to September 2020. During the Learnership, I did my best and was one of the top 5 students. Unfortunately, then COVID-19 came, and the country went into lockdown. My heart stopped, as I didn’t know how this will impact our training. Thankfully, GENRIC announced that they will assist us remotely and Ms Mel helped us to work remotely and the training provider, GIFS, assisted us with the theory online. In October 2020 Ms Mel informed me that I was chosen to work for Genric Insurance. I couldn’t believe it, during these uncertain times and out of a class of 20 students, I received a job offer. I worked very hard during my probation, and I signed a permanent contract in July 2021. It’s almost been a year for me working permanently as an Underwriting Administrator at GENRIC Insurance, and I finally feel like I belong. Recently, I have also been nominated to represent my team on GENRIC’s Employment Equity Committee. My family is very proud of my achievements, and in the next 3-6 months I aim to obtain my RE5 Certificate.
Working for GENRIC Insurance has changed my life for the better. I am extremely grateful for the opportunity, and I can confidently say that hard work does pay off.
Your ‘previously loved’ car is as good as new and gets you where you need to be, reliably. Your decision to buy a used vehicle that you can comfortably afford is a super savvy decision. For one, you’ll be able to pay off a used car much faster than a new one, and you’ll save a fortune in financing fees and interest. You will also not be paying a whack of money every month for a new vehicle that depreciates much faster in value than you can pay it off – with a used car, the bulk of that depreciation has already happened.
“As reliable and trustworthy as your vehicle is though, there are some important insurance considerations to look at in terms of insuring your vehicle for the correct replacement value, protecting your pocket against the unexpected costs of a major mechanical component breakdown, as well as managing your routine servicing costs,” explains Carl Moodley, Chief Underwriting & Claims Officer at GENRIC Insurance Company Limited.
GENRIC offers the following tips for insuring your ‘new used’ car, and protecting your pocket against any unexpected and uninsured losses:
Insure your vehicle for theft and accidents
- Insure your vehicle correctly for theft and accident. The cost of your insurance is influenced by many aspects such as the make and model, cost and availability of parts, whether you are using the vehicle for business or personal purposes, the age of the regular driver (young, inexperienced drivers typically pay more for insurance) and the security measures such as an immobiliser or tracking system and where it is parked overnight. Always disclose all relevant information that the insurer requires including any extras on the vehicle as well as who the regular driver is to avoid having a claim declined or a claim pay-out being less than expected due to non-disclosure of material facts.
- Always insure your vehicle for its ‘retail value’ – this is the price at which the dealer will sell a used vehicle to you, versus ‘market value’ which is the value you could expect to sell the vehicle for, and is typically less than retail value.
- It is especially important that you maintain your vehicle in good working order according to its servicing requirements, that it is roadworthy and driven according to the laws of the road, to avoid any issues should you need to claim. As a simple example, if you are involved in a car accident, and it turns out that your tyres were smooth and below the legal tread limit required, you could find your claim declined since your vehicle would be deemed unroadworthy.
Get cover for major mechanical failures
- Typically, a new vehicle comes with a basic manufacturer warranty which would cover any mechanical and electrical parts for repair or replacement should they fail within a certain mileage or age – usually under 100 000km or anywhere between two to four years, manufacturer dependent. With a used vehicle however, these warranties may already have lapsed which leaves you at risk of costly ‘out of manufacturer warranty’ breakdowns.
- In such circumstances, a Mechanical Warranty Insurance policy is an invaluable financial planning tool that covers the repair of your car due to mechanical failures or breakdown once it falls outside of its factory warranty period.
- GENRIC’s mechanical warranty product covers your car for mechanical or electrical failures up to 220 000 kilometres or as long as the car is younger than 12 years old. Over 30 components are covered such as the engine, transmission, gearbox, turbochargers, bearings, cooling system and electrical components.
- In the event that your car breaks down as a result of mechanical or electrical failure, the warranty will take care of repairing or replacing the parts subject to the policy limits defined per component, and subject to the benefit option you choose.
- For a relatively low premium starting from around R150 per month, a major mechanical breakdown such as an engine, cambelt or turbocharger failure – which can easily top R25k or more in costs – will be taken care of and you won’t have to fork out the full repair cost from your own pocket.
- If you don’t have the means to finance such repairs, and you don’t have mechanical warranty insurance, you may very well end up with a car that you cannot drive, and you won’t be able to sell it, at least not for what it’s really worth to you, if in a state of disrepair. It’s an invaluable cover at a time when a big financial knock could set you back for years, or force you to write your car off.
- It is important to understand that mechanical warranty is not the same as a service plan, so you cannot claim for parts that fail due to wear and tear such as brakes, batteries, tyres and so on.
Service and Maintenance Insurance
- A service and maintenance plan like GENRIC’s DriveWize provides cover for the scheduled service and maintenance that your vehicle will need either at certain mileage intervals or during a certain time frame, whichever comes first.
- Instead of having to pay for the service in one large upfront lump sum, you pay a much smaller, more affordable monthly payment which will go towards the cost of your car service. The benefit is that paying a few hundred Rand per month is a lot more affordable and manageable than having to instantly pay a large sum of a few thousand Rand, especially if it’s a major service.
- Depending on the option you choose and the make of your vehicle, your service plan will typically cover the general service components such as air filter, engine and transmission oil, brake fluid, coolant, fuel and oil filters, pollen filter, spark plugs, sump wash and related labour, subject to the policy limits.
- Under the maintenance component of your plan, you get the added protection for the replacement and repair of the wear and tear parts including alternator, brake discs and drums, brake pads and shoes, cambelts and tensioners, clutch, engine control units and drive belts, front and rear suspension (wear and tear only), mountings, shock absorbers, steering components, V-belts and wiper blades.
“Maintaining and servicing your vehicle is important, not only to ensure that your vehicle is reliable and safe to drive, but also to maintain its insurability if you are ever involved in an accident. In fact, wear and tear and lack of maintenance are often reasons why an insurance claim may be rejected or the settlement less than expected as the vehicle may be deemed unroadworthy. By adopting a comprehensive insurance approach on your vehicle, you protect yourself from the hard financial knocks should something go wrong – whether that is an accident or theft, to a major component breakdown, to a major car service which comes at a significant upfront cost,” explains Carl.
Diabetes is a challenging and lifelong condition to manage and impacts on virtually every aspect of daily living. It is also a serious and high-risk condition due to the number of co-morbidities that exist alongside it. It is this complexity and co-morbidity risks that have made getting life insurance cover for people living with diabetes expensive at best, and often unavailable at worst.
Martin Rimmer, CEO of Sirago Underwriting Managers (Pty) Ltd (Sirago), says that beyond the physical and psychological impacts of living with diabetes, the financial implications are onerous. “People take out life insurance for many reasons – the most common one is to take care of dependants should they pass away. Until now, for people living with diabetes, obtaining quality, affordable life cover – a crucial building block of personal financial security – has been enormously challenging, and in some instances, not possible at all due to the increased risk that such a condition poses to insurers,” explains Rimmer.
Specialised insurance and living benefits
“Consider the implications of someone not being able to protect their family from financial hardship through a life insurance solution in the event of their untimely death. Or even worse, not being able to own their own home as they are unable to cede their life insurance as surety for the bank’s risk in providing a home loan. If they are managing their diabetes reasonably well, they may get cover, however it typically comes at a loading of anywhere between 25-400% on the premium that a person of similar age and lifestyle, without diabetes, could expect to pay. Until now, financial advisors and brokers have faced an uphill battle to secure life insurance for their clients living with diabetes that is both affordable, comprehensive and geared for their circumstances,” adds Rimmer.
It is this dilemma that Sirago hopes to solve with a new ‘Diabetic Life’ insurance product that is singularly focussed on people living with diabetes. Diabetic Life is ground-breaking in that it is the only insurance product that embeds a comprehensive and scientifically proven diabetes management programme into the policy benefits, at no additional cost to the policyholder. Adherence to and participation in the programme is mandatory to keep cover in place, with the objective of helping policyholders improve their diabetes control over the long term and in doing so, maintain market related life-insurance premiums and better cover.
Targeted personal lifestyle coaching
The diabetes management programme includes targeted personal lifestyle coaching, administered and facilitated by Guidepost in South Africa. Guidepost specialises in diabetes management and, through personalised coaching programmes, supports people living with diabetes to progressively master their condition and achieve a better quality of life in the long term.
“Sirago and Guidepost have joined forces for this life-insurance option as we believe that this combination provides both brokers and prospective clients a much better understanding of what diabetes management is and most importantly, an easier route into life insurance for people with diabetes,” says Rimmer.
Why does good control matter?
Most, if not all complications of diabetes are often preventable if blood sugar levels are kept as close to normal as possible – the goal being an HbA1C level below 8%.
“Good control of diabetes can mean the difference between a long, fulfilling, quality life, or one of serious illness and complications. From an insurance and risk perspective, good control and consistency is what insurance underwriters look for, not only at the time of application, but throughout the term of the cover. Until now though, people living with diabetes faced many challenges in how to achieve good control in a manner that impacts their financial planning and costs in a positive manner. Sirago, through Guidepost, are challenging and changing this with transformative personal coaching and clinically proven diabetes self-management education and support. This support covers behavioural, educational, psychosocial and clinical aspects of living with and managing diabetes for optimal health outcomes,” explains Richard Johnson, co-founder and COO of Guidepost.
Outcomes in diabetes are linked almost entirely to individual behaviours and it’s here where the Guidepost telehealth programme focuses its efforts on helping policyholders to ‘know and do’ by engaging with a dedicated personal coach. In much the same way as working with a personal fitness trainer, the policyholder is trained in self-management skills, using data, over an iterative series of tele-consults. Unique psychosocial and clinical data is also gathered which improves risk visibility so that risks can be proactively addressed. The ultimate goal is to reduce HbA1c levels and achieve the best possible outcomes for the person living with diabetes. This is not only important for their financial security in the context of their insurance and maintaining affordable premiums but also makes a fundamental difference in their quality of life and overall health.
Diabetic Life provides an invaluable solution to getting the best cover for your client, with easier onboarding and underwriting processes. Knowing how conditions such as diabetes are handled by an insurer’s underwriters and dealing with a specialist insurer will give you a competitive advantage in an environment where impaired lives are becoming more commonplace.
This Product is administered by GENRIC Life (Pty) Ltd an Authorised Financial Services Provider (FSP:50920) and is underwritten by Guardrisk Life Limited a licensed Life Insurer and Authorised Financial Service Provider (FSP:76). Guardrisk Life Limited has partnered with Guidepost, a diabetes management specialist, to provide personalised coaching and clinical assistance on an ongoing basis at no additional cost to the policyholder, for the term of the policy. T’s & C’s apply. For more information go to https://sirago.co.za/diabetic-life/
GENRIC Insurance was invited to talk about careers within the Insurance Industry on Youth Day, 16 June 2021.
The Career Fair was hosted by STINT (Supporting Those In Need Together) in Roodepoort, Gauteng. Young people between the ages of 15 and 19 in search of a career path, attended the Career Fair. Professionals from various sectors were present with career talks, personal experiences and advice for the youth.
GENRIC’s HR Manager, Melanie du Plessis shared her personal career story, and the theme of her message was: “It’s Okay!”
“It’s okay at your age not to know what you want to do and it’s okay if you haven’t decided what you want to study.
She asked the audience whether they know how to make popcorn and explained that, although popcorn is prepared in the same pot, same heat and in the same oil yet, they don’t pop at the same time.
“In life, we are like popcorn guys, never compare yourself to others. Your turn to pop will come!! Embrace your uniqueness wholeheartedly because that’s where your gifts lie”
Melanie explained that the Insurance Industry has grown in the past few years and is currently one of the biggest industries in South Africa with a variety of career opportunities for matriculants and university graduates.
She further explained the role that Education and Training plays to attract young talent to the industry as well as the funding opportunities available in partnership with INSETA.
Afterwards, the learners had the opportunity to ask Melanie questions while GENRIC’s Senior Graphic Designer, Deidre Tavares spoiled them with stationery and chocolates.
As consumers look to the market for products that meet their changing needs, insurer expands its partnership model to help entrpreneurs and insurtechs create them.
GENRIC Insurance Company, which has successfully launched multiple non-life insurance products through its partner-focussed business model, has now expanded its offering to include life products. Through its newly established life cell with one of South Africa’s leading cell captive insurers, Guardrisk Life, GENRIC’s goal is to help innovative entrepreneurs bring their niche ideas to “life.”
“With the onerous capital and regulatory requirements, technology and expertise demands needed to take an insurance product to market, many innovative solutions simply don’t see the light of day,” explains Monique Hoffman, CEO of GENRIC Life.
“This is to the detriment of an industry that is in desperate need of these solutions to meet the changing needs of consumers. By partnering with GENRIC, we are able to provide the risk financing facilities, tech platforms and administrative support required, with fewer barriers and lower costs than if an insurance entrepreneur were to embark on establishing a cell or license of their own.”
GENRIC’s objective is to provide the structured processes and operational alignments in an incubative approach that facilitates the success of its business partners, while allowing them to retain their innovative, entrepreneurial mindset needed in a highly regulated and competitive industry.
“GENRIC’s incubation hub, GENovation, has been key in driving transformation at an ownership level in the non-life industry through the successful launch of multiple black-owned insuretech companies and underwriting management agencies (UMAs). Petrosure, Solvency Finteq and Sugar are three examples of these companies. GENRIC, at its core, is uniquely nimble. Our partnership model is designed to promote ownership retention, allowing the entrepreneurs behind them to participate in its economic benefits. The goal of the arrangement is to leverage our existing frameworks to enable UMAs, brokers, and insurtech innovators to focus on their specialist, expert skills that differentiate the product in the first place.
“The demand for the same approach in the life insurance space has increased to the extent that we have geared up to expand into that market now too. We are really excited about the variety of products in our current development pipeline and are looking forward to seeing these unfold,” concludes Hoffman.
GENRIC Insurance Company appoints Bosch Services as preferred supplier on its Mechanical Warranty Insurance
GENRIC Insurance Company Limited (GENRIC) has appointed Bosch Services as a preferred supplier under its Mechanical Warranty insurance product. The appointment of Bosch, which has a well-established pedigree in vehicle services and repairs, provides peace of mind and preferential pricing for GENRIC policyholders.
GENRIC’s Mechanical Warranty Insurance policy covers the repair of your car due to mechanical failures or breakdown once it falls outside of its factory warranty period. Over 30 components are covered such as the engine, transmission, gearbox, turbochargers, bearings, cooling system and electrical components. In the event that your car breaks down as a result of mechanical or electrical failure, the warranty will take care of repairing or replacing the parts subject to the policy limits defined per component, and subject to the benefit option you choose.
“A mechanical warranty solution pays out a fixed sum for specified mechanical failures or breakdowns, subject to a limit defined in the policy. Cover is also subject to the vehicle being serviced and maintained according to its service schedule. The benefit of working with Bosch as a preferred supplier is that GENRIC is able to secure more favourable pricing on behalf of our extended mechanical warranty policyholders. This could result in significant savings where such a repair done elsewhere may exceed the policy limit. The vehicle owner is also reassured of quality workmanship and parts from a Bosch Service centre with guarantees on workmanships and parts used,” explains Carl Moodley, Chief Underwriting & Claims Officer at GENRIC Insurance Company Limited. GENRIC is an authorised Financial Services Provider (FSP 43638) and licensed non-life insurer.
Another important aspect of a mechanical warranty insurance product is that the vehicle must be serviced and maintained according to the service schedule of the manufacturer, for any claim in respect of a warranty to be valid. “Having a track record of vehicle services is an important aspect when it comes to mechanical warranty insurance. A recent ruling by the Competition Commission means that, effective 1 July 2021, motorists may service their vehicle at any independent service provider and are not restricted to the original dealerships, without any risk of the factory warranty being voided. Whether the vehicle is in or out of its factory warranty period, it’s good news for motorists who now have greater choice in terms of the costs to maintain their vehicles and removes the monopoly that the OEM manufacturers had over independent service providers. As an insurer, having Bosch as a preferred partner means peace of mind for both our policyholders as well as GENRIC as the insurer in terms of the quality and standards of service work and parts provided,” concludes Carl.
Post pandemic consumer behaviour and what it means for your insurance and personal financial planning
The experience of living through COVID-19 has changed consumer behaviour, reshaping our wants and needs and reprioritising what’s important and what’s peripheral. Some of these behavioural changes are likely to endure after the pandemic ends and includes greater health awareness, digital adoption, value-driven purchasing, remote working and ‘nesting’ as homes take centre stage in our socially-distanced lives.
These consumer behaviour trends have implications for the traditional as well as new risks faced in a very different world. Carl Moodley, Chief Underwriting & Claims Officer at GENRIC Insurance Company Limited, unpacked some of the key trends in personal risk driven by the pandemic experience and what this means for insurance and personal financial planning going forward.
“The consumer trends we are seeing have strong geographic dependencies and circumstances specific to South Africa’s social-economic environment will shape how these consumer behaviours play out and their domino effect on all aspects of daily living. Although the pandemic and its associated responses have highlighted inequalities in South Africa, the long-term effects cannot be assumed at this point. However, the key trend of digital adoption in terms of work, learning, transacting and shopping is here to stay, so it is worth unpacking the knock-on effects and whether traditional risks have changed in terms of prevalence and intensity as a result,” explains Carl.
The pandemic has heightened the understanding of the need for risk protection, notably in the life and healthcare space. There is also a clear drive by consumers to avoid any ‘hard knocks’ of unexpected costs and uninsured losses, and this is seen in the attention being given to insurance policy renewals, but also in the uptake of niche risk solutions that deal with very specific risks.
“There is a clear interdependency between risks and behaviours – as one behaviour changes, another risk area is also directly impacted. For example, as more employees work from home, their mobility risks may decrease, however their cyber and property risks increase due to less robust cyber security measures, especially on personal devices and infrastructure at home, and greater use of their home property for work functions. Similarly, health exposures other than COVID-19 increase. Concerns around job security and the work from home trend have weighed heavily on many people, with depression and mental health in the spotlight as people struggle with the uncertainty and isolation of the pandemic. The impact of the delay in regular health checks and elective surgeries due to fear of COVID infections also have implications for detecting serious health conditions early, such as cancer, and the subsequent cost of treatment at a more advanced stage, and overall prognosis,” explains Carl.
GENRIC unpacks some of the key considerations of how risk and insurance needs are changing for South African consumers as a result of the pandemic:
- Increased digital adoption sees increase in cybercrime impacting individuals: As eCommerce and reliance on digital banking and transactional platforms grows, cyber or online risks have soared. South Africa now has the third-highest number of cybercrime victims worldwide with approximately R2.2 billion a year lost to cyber-attacks. ‘Card-not-present’ (CNP) fraud on South African-issued credit cards remains the leading contributor to gross fraud losses in the country, accounting for 79.5% of all losses, while the country has seen an increase of more than 100% in mobile banking application fraud, according to an Accenture report.¹ It’s one of the key reasons why personal cyber risk insurance is now as important as home, vehicle and life insurance in one’s personal financial planning portfolio.
- Mobility patterns have changed – remote working and learning which is already becoming an established trend means people are driving their vehicles much less. Less time on the road also means much lower risk for accidents and theft. The integration of vehicle telematics will be increasingly important in insurance solutions that aim to reduce insurance premiums based on reduced mileage and better driving behaviour. You can expect so see a big shift to insurance solutions with a pay-as-you-go component as consumers drive a lot less and thus expect to pay less for their reduced risk.
- Changes in purchasing behaviour: a move to value-based purchasing has seen consumers increasingly look at cost versus benefit in much sharper detail. With household budgets under tremendous constraints, consumers are looking at ways to mitigate against financial distress due to unexpected large costs. This is one of the drivers behind the high policy retention rate and new take-up of Mechanical Warranty insurance that GENRIC has seen over the last 12 months. Sales statistics show that new vehicle sales have plummeted while used-vehicle sales are way up, driven by affordability. It also means that for used vehicles that fall outside of the manufacturer warranty period, a mechanical warranty insurance solution provides essential protection against any major parts failures or breakdowns down the line. For a low premium from around R150 per month, a major mechanical breakdown such as an engine, cambelt or turbocharger failure – which can easily top R20k or more in costs – will be taken care of and you’re buffered from these large and unplanned expenses. Another important development in the motor space is a recent ruling by the Competition Commission, effective 1 July 2021, which means motorists may service their vehicle at any independent service provider and are not restricted to the original dealerships, without any risk of the factory warranty being voided. It’s good news for motorists who now have greater choice in terms of the costs to maintain their vehicles and paves the way for more competitive ‘service plan’ insurance solutions, independent of the original car manufacturer.
- Healthcare is top of mind – the pandemic has amplified the need for healthcare insurance as consumers realise the implications of a health crisis on finances, especially where one has co-morbidities. GENRIC has seen significant pick-up in enquiries related to health insurance such as its Sirago gap cover, as well as affordable alternatives to medical scheme benefits such as its Wesmart health insurance solution. Where consumers are buying down on their existing medical scheme benefits due to financial distress, they are taking up gap cover insurance to protect them against potential medical scheme financial shortfalls on specialist and in-hospital treatment. The steep uptake in gap cover is not unwarranted as recent mega claims paid by Sirago show massive shortfalls between R40 000 to R160 000 not covered by the medical scheme – without gap cover, the consumer would have to pay for this from their own pocket. The pandemic has motivated people to reconsider not only their health insurance covers, but also the likes of critical illness and life cover.
- Interpersonal behaviour has changed: While relationships and marriages have taken strain during the various lockdown levels and increased time spent at home, other relationships have thrived. People have spent more time with their pets than ever before, and pet adoptions have gone up too. This has driven new demand for Pet Insurance – pet owners want the reassurance that if things do go wrong and their pet gets sick or injured, they’ll never have to decide between their finances and Fido’s health and wellbeing.
- Crime has and will continue to increase: The increase in crime is of significant concern, notably of car and truck hijackings that have increased by 6% and 32% respectively in Gauteng, according to SAPS crime statistics released at the beginning of March. As the economy falters, and more people find themselves unemployed and desperate, crime rate is likely to increase. Taking extra safety and security measures at home and on the road are essential mitigating measures, as is checking that insurance covers are in place for all potential scenarios. Insurance solutions that add extra layers of protection and private response to emergency situations are increasingly in demand. As one example, GENRIC’s SafeHomes insurance solution provides for an emergency panic button which dials up the closest, contracted security provider when activated, sending location details based on your phone’s position. The call can also be routed to receive emergency medical attention as part of the solution offering. In South Africa where road accidents and crime are a daily occurrence and where public emergency services have proven unreliable and under-resourced, it is also not hard to see why demand for emergency medical assistance and evacuation insurance like the Evac24 solution has increased.
- Nesting and Home Improvements have soared: Home improvements and building extensions went into overdrive in the last months as people had more time at home to attend to maintenance and upgrades; working from home triggered a need for home workspaces, especially given that for many the home working trend is likely to become a permanent fixture and security and safety measures were upgraded. Consumers are spending on renovations, DIY projects, gardening and luxury goods to compensate for unrealised holidays and other out-of-home experiences. Other areas of investment include solar PV solutions for homes as load shedding and spiralling electricity costs push more consumers to grid autonomy. These renovations and additions add significantly to the value of your building and contents and need to be accounted for in the sums insured on your insurance policy. The tech underpinning a SafeHomes insurance policy provides access to a property valuation with immediate assessment of a property value using spatial and geo-technologies and mapping this back to deed’s office information regarding property values in the area. It’s essential that these ‘lockdown’ upgrades are correctly insured to avoid the risks of under-insurance in the event of a catastrophic loss.
- Political uncertainty and social unrest is increasing: Given the growing poverty, unemployment and social unrest which has been amplified by the lockdown, service delivery protests and riots are likely to increase in coming months, leaving property and assets vulnerable to losses that are not covered by traditional insurers. Sasria, which provides insurance cover for losses caused by riots and political upheaval, is a specialised cover which policyholders of personal and business insurance need to ensure they have.
“Risk and insurance has changed over the years, but more radically so as a result of the pandemic where there is now a far greater appreciation of just how unpredictable and far-reaching risk can be. It is crucial to understand your evolving risks and how to make the risk solutions available work for your changed circumstances. There are many new insurance products and technologies available that allow you to become a lot more granular in your approach to risk and get the absolute certainty that you’re covered for specific and unique events. As these risks become more complex and interrelated, the guidance and advice of a professional broker will prove invaluable in structuring an insurance and risk management strategy that’s fit for your changed circumstances,” concludes Carl.
- Accenture – Insight into the cyber threat landscape in South Africa, published May 2020, available from https://www.accenture.com/za-en/insights/security/cyberthreat-south-africa [Accessed 10 Nov 2020]
Since March 2020, the world has become an entirely different place. We have radically changed the way we work, socialise, shop, transact and live. Many of the consumer trends that were radically fast tracked as a result of the pandemic – notably digitisation – will be permanent fixtures. One of the industries that will be significantly impacted by this changing consumer dynamic is the short-term insurance sector.
Carl Moodley – Chief Underwriting & Claims Officer; Stuart Forbes – Chief Risk and Compliance Officer and Eugene Olivier – Chief Information Officer at GENRIC Insurance Company, provided their insights on what they believe the key shapeshifting consumer trends will be in 2021 and beyond the pandemic that will see major shifts in insurance product and delivery innovation…
#1: Customer Centricity will be the kingmaker
Every aspect of the insurance journey must be designed with the customer in mind, from understanding their unique risk exposure and risk behaviour, the advice process, insurance distribution, claims management and ongoing policy administration. We are already seeing major drives into the integration of IoT, spatial mapping technology, sensor technology, telematics, advanced analytics and AI in the short-term insurance space to deliver more granular, individual risk profiles and behavioural-based insurance solutions and underwriting. In so far as digitisation of insurance processes is concerned, online journeys must be designed with the total customer experience in mind. Insurers and brokers will need to understand the inherent ‘customer experience’ gaps that exist between online and offline customer journeys, and where experience gaps exist in a tactile engagement that may actually fall away in an online journey.
#2: Consumer are more cost and value conscious than ever before
Consumers are scrutinising every aspect of their discretionary spending and insurance is top of the list. Overly complex product designs and loyalty programmes that consumers inevitably end up paying for will be moot even beyond the pandemic crisis. Consumers will analyse the underlying value for money in every policy and risk programme, and additionally look for the added value in their insurance spend that saves them money, makes their life easier through personalisation and effectively transfers their risk without quibble come claims time. Insurers and brokers will need to invest in sophisticated data and analytics to ensure that both individual and commercial policy holders receive the individualised and appropriate response and risk ratings for their circumstances. We can also expect to see more demand for and development of ‘usage-based’ insurance which provides customers with the ability to switch cover on and off at specific times for when they need it – this has been most prevalent in the motor insurance segment where the work-from-home trend has seen significantly curtailed travel needs, and hence left consumers questioning the cost of their cover given the reduced risk.
#3: Customers are better informed than before, which makes professional advice key
While a recent customer satisfaction index on the short-term insurance sector, conducted by Consulta, showed that intermediated insurance customers have higher levels of satisfaction, it does not mean that the advice and distribution process is not ripe for disruption. While insurance customers do want a more personalised experience and rely on the knowledge and market understanding of their brokers, they are also looking for more digital resources to be brought to the table that facilitate a greater level of self-sufficiency on an ongoing basis. They are actively researching the ins and outs of the insurance solutions on offer and are more empowered than before to make decisions. The insurance broker’s role will shift to one of guiding and facilitating a greater analysis of insurance solutions that fit their needs, on much higher levels of engagement than before.
#4: Keep it smart and simple
It is interesting to note in a recent study – Customer Service Trends for 2021 – by Stella Connect – that while consumers may understand that these are trying times, it has not offered brands much relief in terms of customer expectations. The survey shows that 67% of polled consumers report having the same or less patience for a bad customer service experience since COVID-19 began. Complex systems and processes will simply see customers say goodbye a lot faster than before, so the importance of stress testing all platforms, systems and processes, and all the ‘experience moments’ along the way, cannot be emphasised enough. Ongoing refinement will be key and here sophisticated data and analytics and AI will be invaluable in identifying trends in CX that need addressing or further leveraging.
It is also critical to note that while offering multichannel, AI-driven client self-service platforms is essential in providing scale and resolving simple queries to reduce volumes, they are not a replacement for the human touch. Brokers will continue to play a crucial role and interface with their policyholders, especially on more complex claims and queries, and here first-time resolution will be key. AI and data analytics can help meet customer needs faster and more intuitively than ever before, while freeing up brokers to focus on more complex customer needs.
#5: Consumers are looking for niche solutions for specific exposures
GENRIC’s own experience in the last ten months is that consumers are increasingly looking for niche insurance solutions to address very specific needs and unexpected cost exposures. One such line is Mechanical Warranty insurance where policy retention and new uptake has remained high despite the tough economic environment. With an increasing number of older vehicles on the road, consumers delaying new car purchases as they consolidate their debt and also travel less with new remote working trends, this type of cover makes sense to protect policy holders against the unexpected and typically high financial cost of mechanical component failures no longer covered under service and manufacturer warranty plans.
Personal cyber insurance is another growing area given our reliance on internet connectivity for virtually every aspect of our lives. We can expect to see protection for cyber risks becoming an essential personal financial planning tool in much the same way as household, motor and contents insurance is for physical risks. Niche insurance solutions that cater for specific risks and exposures are expected to grow as consumers increasingly look to only keep that which they need and which performs at claims time.
#6: The pandemic has thrust healthcare insurance in the spotlight – the pandemic has amplified the need for healthcare insurance as consumers realise the implications of a health crisis on finances. For many South Africans, the parlous state of public healthcare facilities is unpalatable, so securing their continued access to private healthcare is a priority. GENRIC has seen significant pick-up in enquiries related to its Sirago gap cover, as well as affordable alternatives to medical scheme benefits such as its Wesmart health insurance solutions. Where consumers are buying down on their existing medical scheme benefits due to financial distress, they are taking up gap cover insurance to protect them against potential medical scheme financial shortfalls. The pandemic will motivate people to reconsider not only their health insurance covers, but also the likes of critical illness, life and income protection cover.
#7: Trust needs to be rebuilt
A big issue that has impacted the entire insurance sector is that of the fallout of business interruption claims during the pandemic. While these were limited to certain insurers and impacted commercial policyholders only, the highly publicised and sensitive nature of these claims has spilled over to all consumers. There is significant work to be done to restore the reputational damage in terms of the expectations of clients versus what is covered in terms of their insurance contracts and policy wordings. Much of this comes back to the principle of smart and simple cover and removing overly complex layers, with clear policy wordings and well-defined terms and conditions.
In as much as the last year has been tremendously challenging and will continue to be so for at least the medium term, there are also tremendous opportunities that exist with the pandemic’s fast tracking of virtually every industry into the 4th industrial revolution. The insurance and risk landscape is no different. Risks and needs are evolving, and change brings inherent opportunity. Insurers should look to add true client-centric value in a digitally differentiated world by building more resilient business models, developing new lines of coverage to meet evolving exposures in the market, and embracing the opportunities presented by technological disruption.
Personal cyber cover for online risks becomes as vital as motor and household insurance for physical risks
Our growing reliance on internet connectivity means that protection against cybercrime is an increasingly important consideration in personal financial planning
As eCommerce and reliance on digital banking and transactional platforms grows, so too have the risks for fraudulent payment scams and cybercrime. Cyberattacks now cost the world more than natural disasters, while malicious hackers attack computers and networks at a rate of one attack every 39 seconds, according to a report from Accenture¹.
Cybercrime can affect anyone who transacts online, while the pandemic has amplified the risks by opening the door to greater opportunistic threats. Phishing scams, virus attacks, fraudulent online and in-app purchases and EFTs, social engineering and identity theft affect millions of businesses and individuals every year.
“While the need for cyber insurance is more readily understood and taken up in a commercial environment, individuals often believe that it won’t happen to them because hackers don’t consider smaller targets worth the effort. Statistics clearly show that this is not the case, and many consumers simply overlook the importance of protecting their online and personal identity through an insurance and risk management approach, in the same way that businesses do,” explains Carl Moodley, Chief Underwriting and Claims Officer of GENRIC Insurance Company.
“Given our reliance on internet connectivity for virtually every aspect of our lives – from transacting, payments, communicating, entertainment and more – the need for insurance protection for cyber risks is becoming an essential personal financial planning tool in much the same way as household, motor and contents insurance is for physical risks,” adds Carl.
Cybercrime affects individuals in various ways:
- Anyone who transacts online can be affected by cybercrime.
- Personal credit card and banking details can be stolen off computers, websites, mobile devices and apps and used fraudulently. Credit card details used to pay for mobile applications are vulnerable.
- Fraudulent online purchases can be made when neither you nor your credit card are present at the point of sale.
- Fraudulent EFTs can be done when someone gains access to your banking details and transfers money from your accounts without your knowledge.
- Phishing scams can con you into providing your personal details and use it to perpetrate fraud.
- Viruses and Malware unwittingly downloaded on your computer or mobile devices can harvest your personal data.
- Your identity can be stolen to perpetrate fraudulent online transactions. The process to restore your credit record and reputation can be onerous and very costly in terms of time, inconvenience and even legal costs.
“Individuals are typically softer targets as they are unlikely to have the security measures deployed in a business environment – such as anti-virus and malware software, firewalls, encryption, password protection, threat monitoring and so on. While it is easy to understand the physical nature of a robbery at your property and the need for insurance if things do go wrong, the intangible nature of cybercrime leaves people at a loss as to how they can be at risk, and what they need to do to protect themselves. It’s a worrying oversight given just how prevalent cybercrime has become in South Africa where individuals are as much in the sights of cybercriminals as businesses are,” adds Carl.
According to Accenture, South Africa has the third-highest number of cybercrime victims worldwide with approximately R2.2 billion a year lost to cyber-attacks. ‘Card-not-present’ (CNP) fraud on South African-issued credit cards remains the leading contributor to gross fraud losses in the country, accounting for 79.5% of all losses, while the country has seen an increase of more than 100% in mobile banking application fraud, according to the Accenture report.¹ During 2019, malware attacks increased by 22% or 577 attempted attacks per hour.¹
Individual cyber protection is now a necessity as cybercrime rapidly escalates
The pandemic has catapulted virtually every aspect of our personal and work lives into the cyber realm – from work, education, shopping, communication, entertainment and transacting. As a result, individuals face greater risks and the potential for actual financial losses due to online threats. These threats will grow exponentially as we lead more digitised and internet-dependent lives.
“It’s one of the key reasons why personal cyber risk protection is becoming as important as home, vehicle and life insurance are in one’s personal financial planning portfolio. Risks are no longer limited to what can go wrong on the physical world. A product solution like GENRIC’s Mycybercare product was designed for this eventuality, and protects the policy holder for loss of funds as a result of fraudulent online and In-app purchases, virus attacks, fraudulent EFTs, virus attacks and phishing scams. The cover is designed as an affordable addition to one’s personal insurance portfolio, and allows you to structure the cover to protect multiple devices, as well as a defined sum-insured,” explains Carl.
Beyond insurance protection alone, Mycybercare also provides focused mitigation and educational measures to help consumers become more cyber-savvy and proactive about protecting their online identity and activity across personal, family and work exposures.
“The policy is structured to mitigate against cybercrime in the first place by implementing suitable virus and malware protection, detecting malicious threat actors and monitoring the dark web for fraudulent usage of your personal, family or business digital assets such as your ID, email, credit card, mobile number, bank account, IP addresses and other variants. It also provides for cyber bullying prevention in terms of IT, legal and psychological assistance, and insures for online loss of funds. The monitoring and protection is done in real-time and policyholders are notified of any alerts that require intervention to prevent being a victim of online crime. Cyber security awareness training is also provided through a video training portal which shows consumers how the human link is often the weakest link in a cyberattack, and how to prevent becoming a victim of online crime in the first place,” he adds.
Premiums range from R40 per month (R350 per annum) for R10 000 cover to R70 per month (R730 per annum) for up to R100 000 in cover for financial loss. Premiums and benefits are subject to review. For more information, terms and conditions, benefits, limitations exclusions visit www.genric.co.za and https://my-cybercare.com/
MyCybercare is a product of GENRIC Insurance Company Limited (FSP 43638), an Authorised Financial Services Provider and licensed non-life insurer.
- Accenture – Insight into the cyber threat landscape in South Africa, published May 2020, available from https://www.accenture.com/za-en/insights/security/cyberthreat-south-africa [Accessed 10 Nov 2020]