Is your insurance cover adequate in a volatile rand environment?

TIMES are tough, geopolitical tensions are high in global markets, and South Africa is not immune.

- STAFF REPORTER

Continued pressure onand depreciation of the rand - largely due to factors outside of our control - fuel fears and add financial strain to a struggling economy, which already needs to deal with successive VAT increases over the next two years.

These developments have an impact on all business sectors, including the insurance industry. This is according to Ryno de Kock, head of distribution at PSG Insure, who unpacks how rand volatility and depreciation could be impacting your insurance cover, both from a business and personal insurance cover perspective.

A weaker rand means imported goods cost more

Most consumer goods in South Africa - including cars, electronic devices, and household appliances - are imported. “A weaker rand means that all these items cost more - which in turn means that their replacement values increase. Insurance companies are likely to experience higher claim values as the rand depreciates and may in time have to increase insurance premiums to cover these,” says de Kock.

Don’t skimp on adequate cover