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A study by Santam, the country’s largest short-term insurer, has revealed the majority of corporates and consumers polled in a landmark survey on insurance trends see the challenging economy as the biggest risk in South Africa over the next two years, followed by political unrest and social change risk.
Called the Santam Short-Term Insurance Barometer (Barometer), the study found that 67% of corporates and 91% of consumers saw the challenging economy as the biggest risk in the country.
Quinten Matthew, Executive Head of Specialist Business at Santam said the first-of-its-kind barometer in South Africa had been developed to accumulate deep insights into the general insurance sector.
“Our aim is to take the collective ‘temperature’ of consumers, intermediaries and corporates on an annual basis and to draw seminal conclusions which will highlight the contribution the insurance industry brings to the country besides protecting assets of consumers,” he said.
The study was collated polling more than 400 respondents that included intermediaries, corporates, commercial entities and consumers.
“The Barometer’s findings will allow the entire industry to add as much value as possible to South Africans who trust them with their insurance. We are also hoping that by highlighting trends and insights, we can convince more and more people to ensure they are adequately covered. In so doing, the Barometer will play a role in minimising the impact extreme weather events, accidents and crime have on our economy,” Matthew said.
The in-depth body of research showed the biggest concern among corporates and commercial entities in South Africa to be theft, followed by motor vehicle accidents and fire. On the consumer front, the top risks are motor vehicle accidents, burglary and theft.
Matthew said the Santam Insurance Barometer specifically measured the role of insurance in the economy, risk trends impacting South Africa, insurance as a risk mitigation tool, the role of intermediaries and the opportunities for the insurance industry in South Africa.
Consumer / Personal Lines:
Corporates / Commercial Entities:
Purchasing Channel Preferences:
“The Barometer shows people want tech-led solutions that are personalised, flexible, and often limited to specific circumstances – such as insuring electronics only, rather than investing in home contents insurance. Additionally, consumers need more proactive mitigation of emerging risks like cybercrime. The Barometer found it is not yet considered an imminent threat, possibly due to cyber-attacks being massively under-reported,” Matthew said.“We have a strong, well-established insurance industry in South Africa, and positively, confidence in the industry is high. Our Barometer showed a net 16% of commercial and 33% of consumers expect increased use of insurance in the future, but to remain relevant, we need to be client-centric and innovative. This means using technology to speed up service delivery and training new recruits in line with succession planning to avoid skills shortages,” he added.Going forward, partnerships will be critical to thwart risks
“We believe the insurance industry can do even more to promote good risk management, including lobbying government to maintain infrastructure, invest in emergency services, enforce laws (like building regulation compliance) and make 3rd party insurance compulsory. We remain committed to these kinds of partnerships. This Barometer is a way for us to lay the groundwork for the discussions that will make us all more secure in the long-term – especially the most vulnerable in our communities,” Matthew said.Santam’s Short-term Insurance Barometer will be published on an annual basis focusing on key topics addressing risk and considering trends driving change.
ADDITIONAL BAROMETER FINDINGS:
Other key risks identified in the Barometer included:
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