The sustainability of affordable motor insurance has once again been the topic of discussion recently as a result of the current financial pressure experienced by South African consumers. The rise in interest rates will ultimately lead to an increase in premiums and presents the risk of consumers seeking cheaper insurance options or choosing to lapse their policies. We are very much aware of our motor insurance members’ attempts to minimise the impact on customers, and would like to commend those members who are taking a proactive approach to inform consumers of the factors that lead to an increase in premiums and to educate them on the importance of short- term insurance. Informing policy holders of alternative ways to reduce a premiums such as adding on extra security features to a vehicle or to consider third party cover in cases where comprehensive cover is unaffordable, is a part of this process. We encourage all our motor insurance members to follow this process in the interest of addressing any potential negative perceptions, and reputational risks for the industry
The value of short- term insurance during these volatile times cannot be emphasised enough as a means to protect consumers against risk. In addition, the importance of the short-term insurance industry’s contribution to the economy should be emphasised. SAIA and the FIA released a joint media statement to the media during the second week of May 2016 to create further awareness regarding the value of short-term insurance and the short-term insurance industry as part of our joint and collaborative initiative to promote the short-term insurance industry.
SAIA continues to look at innovative ways to educate consumers about short- term insurance and to change perceptions of insurance as a grudge purchase. One such project is the SAIA Next of Next Week Comedy series that addresses a number of issues broadly categorised into three main topics namely insurance, savings and investment. The series has been well received and filming for season three started in May 2016.
Since inception in 2004, the SAIA Consumer Education initiative has been very successful and has been used as a case study internationally, of which we are very proud. SAIA members have committed almost R116 million to uplifting the financial education and skills in South Africa to date. We thank all members for their continued support on this important initiative.