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Understand how your excess works
If you own an insured motor vehicle and you have ever had to claim from your insurance you should be familiar with the word “excess”. An excess is simply the uninsured portion of your loss or that portion of the claim you must pay for. Richard Green, National Director of SAMBRA, the South African Motor Body Repairers’ Association, says SAMBRA, which represents almost 1000 motor body repair businesses across South Africa and accounting for over 80% of all insured repair claims in the country, often receives queries from customers who are not 100% sure about how their excess works.
Green says the Ombudsman for Short-Term Insurance recently released an article providing some excellent informative content explaining the various scenarios. He explains that the primary reason for an excess is to ensure motorists do not feel tempted to claim for every small loss. It is there for when you cannot afford to pay for a loss yourself and is designed to eliminate small value claims which have a high administrative cost relative to the value of the claim. Green says the economics are sound. It is like having medical aid to a certain extent. “If there are too many claims premiums become unaffordable for all members so keeping claims to a responsible level helps keep premiums lower for all policyholders.”
The Ombudsman explains that not all excesses are the same. There are many different excesses and the extent these apply to you will depend on the agreement you have reached with your insurer.
These include:
- Standard/basic excess: The insurer’s standard excess for the type of insurance.
- Voluntary excess: An excess you may agree to carry in addition to your standard excess in return for a discount on premium.
- Additional excess: The insurer charges an additional excess when the policy holder is deemed to be high risk i.e. under 25 years old or has had a driver’s license for less than two years.
- Imposed excess: This sometimes happens because of the number of claims you have had or for other factors which may mean you are more likely to make a claim.
Green says there is also an insured excess one can consider. This is a separate policy that can be taken out to cover the excess you have agreed to pay with your insurer. In the event of an accident your excess policy will then fund the agreed excess portion of the claim.
Green agrees with the Ombudsman saying the onus is on the insurer to bring these excesses to your attention at the time the contract is entered into or at any time when there is a change in the excess. He says sometimes there can be an excess waiver where you can do away completely with an excess but you do end up paying a bit more on your premium. “At the end of the day you need to weigh up your monthly finances and assess your risk and then speak to your insurer if you feel there could be a better option for you,” says Green.
The next important question is, who recovers the excess? The Ombudsman says if someone else caused your loss, the insurer may be able to recover the cost of the claim, including your excess, from that party or their insurer. Your excess can then be reimbursed. There is, however, no obligation on an insurer to recover the excess and the success of the claim depends on a number of factors like if you were able to fully identify the other party; whether they admitted fault; whether there were any witnesses, etc.
Green says it is worth checking this with your insurer because the Ombudsman agrees that if the insurer does not manage the recovery, you can elect to do this yourself with your insurer’s permission and proceed to recover your excess directly from the third party. “Not everyone knows this,” says Green, “so definitely worth the extra effort.”
Finally, what happens if there is a dispute? The Ombudsman advises that in order to get your claim processed quickly, you need to pay your excess, even if you are unhappy with the amount, and then only dispute it. Green says the potential consequence of not paying is that you could, for example, end up having to pay storage costs to the repairer who ends up doing the repairs on your car while you dispute the excess with your insurer. “In summary it is better if you have a dispute with your insurer relating to any aspect of your car excess, to first try to resolve it with the insurer. If you are still not happy, then your next step is to contact the office of the Ombudsman for Short-Term insurance.”
Source: FA News
Prepared by CORE Short-Term
For more information, contact 051-448 8188
Unlocking empowering technology could save rural areas
The Global Forum for Food and Agriculture (GFFA)’s 2019 conference in Berlin in Germany, with the title Agriculture Goes Digital – Smart Solutions for Future Farming, was attended by more than 2300 delegates from all over the globe. These included ministers and other important role-players from governments, business leaders and politicians. Authoritative discussions on the extent of, progress with and the unlocking of the full potential of digital agriculture took place. The CEO of the FAO focused on how technical skills for young people as the most important brain drain from rural areas can be overturned through the use of technology.
Labour mobility is a well-known phenomenon of economic development. Apart from the movement of schooled labour that contributes to better productivity, rural areas are prone to losing young people. Aside from the brain power that is lost in this way, it also contributes significantly to a smaller labour force. Those who remain behind are getting older and resources are utilised in a less productive manner.
This sub-optimal utilisation contributes to social issues such as household food insecurity, etc. An additional negative impact of urbanisation is the impact it has on the poorest of the poor. They flock to cities in the hopes of getting a job, are displaced from what is known to them and thus speeds up the spiral of poverty.
A lot of time and money is spent in approaching rural development differently, namely to empower productive labour with training and economic opportunities in rural areas. There are many examples, but unfortunately not many success stories. The FAO has reiterated its commitment to focus on training the youth to work with the technology of the day where they are comfortable with the environment. This corresponds with the modern work environment of virtual offices. More and more people are working flexi time and are productive anywhere where there is a dependable internet connection. It is clear that agriculture has not yet stepped into this arena fully despite unbelievable technology. Currently this technology is applied in affected areas by sending city-dwellers to the areas instead of using trained local labour. Training in this regard is a key aspect and requires that current training approaches be revised, not only for prospective farmers but for everyone involved in the value chain.
Some 60% of Africa’s estimated 1.2 billion people are younger than 25, according to the FAO. With little or no job creation in rural areas where most of these young people currently reside, there is increasing concern over the continent’s readiness to profit from new technology. A more specific concern is that it can smother or even extinguish small farmers’ and entrepreneurs’ innovative nature of technology is not unlocked. For this to happen, training is required and it is easy to point to examples such as drones used for collecting information, collecting market information and preparing for the increasing use of robot technology in agriculture. Better farm management is already attributed to better local technical skill. Predictions are that robots could replace the traditional tractor driver. Currently too many farmers are still battling with the challenges set by current technology used to create “smart” implements.
Innovative technology and support could have a positive influence on productivity and profit, encourage healthier food choices, empower the youth and women in rural areas because information unlocks markets, establish new agriculture practices and complement the sustainability of the environment as a result. The question is whether governments’ development initiatives will make this possible. In this light any investment in digitising rural areas is more than worth it, and should be prioritised.
Prepared by CORE Business Development
For more information, contact 051-448 8188
The value of food product information
This year’s focus in terms of food safety is on the value of information about what one can eat. International trade has resulted in market borders disappearing to a large extent. Compulsory information about what is packaged in terms of nutritional value and origin of production complements trade and improves health through healthy eating habits. Evidence supports the value of knowing, but also what can happen when consumers are misled.
Food labels are a statutory requirement in most countries and have support in the form of the CODEX ALIMENTARIUS (International Food Standards Codex). The codex contains science-based guidelines developed by 188 members and is a statutory requirement that is globally enforced. These standards contribute meaningfully to safety, quality and fairness in the food trade. It sets standards for compliance and through compliance it creates peace of mind. In fact, there is now talk of overzealous use (abuse) of information on labels such as the real meaning of “best before”, etc. as a contributor to food waste. The fact is that proper and trustworthy labels have proved that the stumbling blocks in terms of trade can be removed.
In order to understand the value of food labels, the FAO has published six guidelines for understanding and applying food labels.
In the first place the information on labels helps to understand the content in terms of nutritional values such as fat, sugar content, etc. This information is crucial in order to ensure that people are eating healthy, safe food. It also creates the opportunity to consider deficiencies, especially iron and vitamins. What you eat determines your body weight and by looking at what you eat you can live a healthier lifestyle. As an example, consider the implications of a lack of nutritional information for a diabetic.
Dependable information on a label contributes towards and complements food security. Annually some 600 million people get sick as a result of contaminated food. The outbreak of listeriosis that claimed more than 200 lives in South Africa contributed to the estimated 420 000 people who die each year as a result of contaminated food. There are also instances of expired food sold at reduced prices, exploiting the poorest of the poor with far-reaching consequences. Proper labelling provides important information on how to work with food in terms of storage and preparation.
Labelling also prevents counterfeit products being sold to unsuspecting consumers. Dependable producers are proud of the origin, production practices, etc. of what they offer. Unfortunately there are always those trying to take a short-cut by counterfeiting or selling blatant lies. Standard procedures regarding labels that enjoy international compliance create markets through the trust carried with the labels. FAN meat that is properly labelled according to standards will not create doubt with consumers. In fact, through social media the consumer can use the label to get insight into how and where the product was produced. Most chain stories are very clear in informing customers that all fish sold were sourced through sustainable methods, meat of origin can be traced to the specific farm, etc. Not so long ago Chinese sweets producers where caught putting melamine in their products without warning consumers. In this way the producers could stretch volume but the health risks were simply ignored.
Warning on the possible health risks of some ingredients can prevent a lot of trouble. The fourth factor deals with the value of consumers being able to make an informed decision. A lactose-intolerant infant’s mother has to be aware that a product contains lactose. Modern resistance to diseases makes this a crucial aspect. There are many known instances where the lack of information in this regard resulted in legal action.
Another additional value of correct labelling is that it can limit food waste. Consumers must be informed on how long food will remain safe to eat. An estimated 10% of all food in the European Union goes to waste because consumers do not read the label correctly. Confusion between “best before” and “use by” dates is the biggest cause.
One of the most important positive consequences of proper labelling is that it can improve the use of local products. According to a study by the FAO of nine products an indication of the place of origin on the label has led to a price increase for producers of between 20% and 50%. Although this study focused on international products a product such as Karoo Meat of Origin could have the same possibilities. There is a lot of evidence that indicates that the consumer is prepared to pay more for a product from a specific area.
However, it remains everyone’s responsibility to buy and eat in an informed manner and to ensure that information that is lacking is obtained.
Prepared by CORE Business Development
For more information, contact 051-448 8188