[ICYMI] We see three times more surge claims with loadshedding under Stage 4 vs no load shedding ... you can imagine when it reaches Stage 6: DiscoveryInsure's Darryl Grater on the SAfm MarketUpdate insurance powercuts Discovery_SA podcast
FIFI PETERS: We’re in for more load shedding. I suppose that doesn’t come as a surprise to most of us, with Eskom updating the nation a little earlier today saying it’s still unable to fulfil all the demand expectations being placed on the grid.
If I consider just contents claims – office contents and home contents claims – power surges are the top three causes of claims. ‘Peril’ – that’s an insurance term for cause of claim. That, among accidental damage and weather and power surges, that’s 75% of our contents claims. So the impact is profound.
Back where I work at Discovery, we cover power surges as standard – obviously [at] different policy levels. Your Purple or High Net Worth plan covers it to sort of full-sum insurance. But then your more premium-sensitive clients would take a lower capped amount for a cheaper premium. And then there are obviously insurance companies offering an additional buy-up. So for an additional premium the customer, whether a business customer or an individual, can buy up to R2.
If I just consider the Discovery client profile, most of our clients have supportive policies. So they’ll have their vehicles as well as their assets or their property insured. We’ve got a client base of over 200 000 policies, so you can imagine the impact on our business. And when you consider the insurance market, Fifi, it takes commercial insurance, personal insurance and corporate insurance.
One must also consider the backdrop of insurance over the last year or two. If you consider the floods in KwaZulu-Natal, if you consider just the general fires that have occurred, and then, more importantly, if you consider what’s happening with CPI and inflation, insurance inflation is far higher than CPI, which has been exacerbated by the global supply chain, which is why we talked about **
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