GENERAL UPDATE Presented by Mokgadi Sebola Customer Relations Officer FIA Road show.

GENERAL UPDATE

Presented by Mokgadi SebolaCustomer Relations Officer FIA Road show

Introduction

Sasria SOC Limited is a short term insurer for special risks such as riots, strikes, terrorism

Sasria is the only insurer for special risks in SA

It was formed as a direct result of the 1976 uprisings

It has been in existence for over 30 years

Current Product offering

Sasria Wrap

R1bn Coupon = MD + SC or WE

Primary Coupon R500m Coupon = MD + SC or WE

Current Business Interruption Fixed costs of the business – no net profit

Method of arranging Sasria BI

Specified Standing Charges The List of Standing Charges must be provided There must be a Sasria Material Damage Coupon in force covering the

same interest and period The Sum Insured must represent the list of specified standing charges

(Not the Conventional Policy Sum Insured)

Uninsured Working expenses The List of Uninsured Working Expenses must be provided The Sum Insured must represent the insured working expenses

(Not the Conventional Policy Sum insured) Accepted formula: GP – NP = WE

New Business Interruption

Effective 1st Sept 2012 net profit cover available within the

R500m Coupon ONLY

There must be a Material Damage Coupon to which the BI

cover will attach – not available on its own

SC/WE cover still available without the full BI cover

Current SC/WE rates applicable to the full BI

No extensions

New Business Interruption

Policy wording:

To be finalised and will be communicated during the road shows & before the launch

Regulation:

The Regulations are currently being finalised .

Cover:

Cover is now comprehensive, but it excludes extensions.

Clients still have an option to take only the current SC/WE cover only, in which case the rate would be applied to the SC/WE value .

New Business Interruption

Rating:

Rates are as per the SC/WE, the difference will be the sum insured that the rate is applied to if the full BI(higher sum insured) is taken

Existing insurances:

With the new product in place, this has to be purchased

from Sasria unless dispensation is obtained

Business Interruptions

Uninsurable extensions (Additions)

Fines and penalties Prevention of access Public utilities Public telecommunications Accountants clause Accumulated stock clause Output clause Incompatibility cover

Customer Relationship Management

General update

Customer Relationship Management

Due to the Sasria business model, partnership between Sasria, agent companies as well as brokers is critical in providing excellent service as well as adequate insurance covers to our mutual clients.

Effective functioning of the value chain is of key importance to Sasria, hence the establishment of the Stakeholder Management Division.

To further improve the interaction between Sasria and its distribution channel, Sasria developed and implemented a Customer Web Portal (CWP). The portal has a document management facility for claims administration, underwriting administration, and e-coupons.

General update

Customer Relationship Management Understand the industry needs and devise means of meeting same

Technical support visits to Agents and Brokers assistance with Regulations Compliance with audit findings

Dissemination of product knowledge to all stakeholders Agent/Broker specific product training sessions Industry product training session

Zandspruit service delivery protest, 2011 (Source: News24)

Changing Environment

Change in trend South Africa has experienced prolonged industrial action which

could pose a risk to economic growth and investment Social media used to arrange protests High unemployment (25%) which will have catastrophic

consequences to our society Unemployment among the youth and graduates is a worrying factor,

this may lead to uprisings similar to Arab uprisings Misguided economic views because of anger and no hope from our

youth Social needs – increase in service delivery riots Human rights violations Increasing food prices / food security concerns

Claims Procedure

Claims ProcedureClaims Notifications

Claims Registration

Required documentation

Preliminary Claims advise Form

Sasria Coupon/Policy Underlying Policy Schedule Claim Form Quantum documents (quote, invoice, etc) Additional documentation

Duties of the Agent

Claims Procedure Preliminary Claims Advise Form

Must be submitted with all first notification documents. Must be completed in full.

Sasria Coupon/Policy

Legibility Period of Insurance and Risk Backdating

Underlying Policy Schedule

Non-Motor - Cover details Motor – stand alone

Claims Procedure Claim Form

Agent’s claim form Insured’s statement Glass claim form

NB: Claims less than R50K are fast track claims

Quantum documents At least two quotes Invoices Clearance Certificate

Additional documentation

Endorsements to the Coupon

Deductibles

Claims Procedure Salvage

No party to salvage contracts

Prescription Non-motor Motor

Sasria Release

Payments

Claims statistics: 2011/2012

Description period ended

31 March 2012

period ended

31 March 2011New claims 1168 504

Closed claims 1086 445

Number of outstanding claims(end of financial year)

196 173

Average age of closed claims 90 days 127 days

Loss ratio 19.64% 22.60%

Note: 1. A high number of claims were received in 2011/2012 mainly due to the : taxi strike, truck driver strikes, and disgruntled commuters 2. Despite the increase in claims frequency, the claims severity was better than last year. The double digit loss ratio for second year in a row confirms the new claims trends as well as an upward movement in claims submitted 3 Loss ratio as at end March 2012 is 22%

Claims statistics: 2011/2012

Claims outstanding per peril: end March 2012

15%

13%

73%

March 2012

Non Political RiotPolitical RiotStrike

Thank you