SwissFin – SwissSure Newsletter August 2022

Dear Readers,

We welcome you to the winter edition of our Newsletter.
As usual, we have included information across the board regarding investments, short-term insurance, taxes, immigration and other related topics. This newsletter can also be viewed under https://www.swissfin.co.za/newsletters/swissfin-swisssure-newsletter-august-2022/

Enjoy the reading, with best regards,

Your SwissFin / SwissSure Team

1. INVESTMENTS

• Interest rates: fixed deposits, insurance plans, tax-free investment amounts and our foreign exchange rates
• We now offer USD accounts!

2. LOCAL AND INTERNATIONAL FINANCIAL NEWS

• Moody’s upgrades South Africa’s credit rating
• Another interest rate hike!

3. TAXATION

• Tax filing season opened on 1 July 2022
• SARS rejects R 1.8 Bio in home office claims

4. SWISSSURE – SHORT-TERM INSURANCE NEWS

• Vantage becomes full subsidiary of Santam
• Cyber Crime – beware of your responsibilities!
• HIC implements new claim procedure
• MUA provides pet insurance
• Renasa’s commercial assist program explained
• How to protect yourself against power surge damages
• Santam adjusts power surge cover and excesses on all policies
• Geyser replacements: Your plumber needs to supply a Certificate of Compliance
• Changes to Business Interruption cover across the insurance industry
• Clarification on hole-in-one cover
• Discovery Insure amends excess structure
• Have you installed an inverter or solar panels – don’t forget your insurance policy!
• Bryte amends hospitality products (BnB Sure)

5. IMMIGRATION

• Update on our court case
• Automatic visa extension until end of September 2022
• Critical skills list amended

6. HEALTH INSURANCE

• BDAE adjusts the Infinity Plan

7. OTHER

• Microsoft 365 problems – did you receive our mails?
• Valuable information on personalized vehicle number plates
• We value your comment

Interest rates: Fixed deposits, insurance plans, tax-free investment amounts and our foreign exchange rates >>

We offer the following rates as of August 2022:

Interest rates ››

The minimum investment is R 100’000. Terms and conditions apply. The rates do fluctuate on a daily basis and the interest rate depends on the investment amount.

Insurance Plans: Guaranteed income/growth plans (5-year term), approx. 80% of income tax-free: ››

Tax-free interest income – maximum investment amounts: ››

R 2,57 Mio. for taxpayers under the age of 65
R 3,89 Mio. for taxpayers between the age of 65 and 75
R 4,25 Mio. for taxpayers over the age of 75

These figures mean that you can invest these amounts in i.e. our money market or fixed deposit offerings and not pay any tax. Couples married in community of property can double these amounts!

Underlying assumptions: 4,0 % effective interest rate and no other income sources.

SwissSure Forex Rates ››

The above table shows that our rates are very attractive compared to commercial banks. Over and above, we do not charge any fees when the funds are credited or transferred to another local account.

Should you wish to receive more information on our money market fund offering, the tax-efficient income plans or our forex offerings please contact Mr. Tony R. Hug on .

We now offer USD accounts! ››

Please note that we are able to open USD accounts for you via our banking platform.
The minimum investment amount is USD 10’000 for money market or 32 day notice deposits. Both accounts do carry interest.
Please contact Tony R. Hug for further information.

Moody’s upgrades South Africa’s credit rating ››

How significant is the decision by Moody’s to upgrade its outlook on SA’s credit rating? There are two sides to this story. On the one hand, optimists should note this is not a grading change, just an outlook change. The SA’s foreign- and local-currency ratings still sit at Ba2, which is two notches below investment grade. There is a long, long road ahead getting back to investment grade.

On the other hand, the rating upgrade reflects two things. The improved fiscal outlook because commodity prices are on fire, and the SA government’s efforts to reduce the budget deficit and therefore reduce government debt. The problem with the latter is that governments around the world, SA included, have claimed they intend to reduce the deficit, and they never actually do. The problem with the former is that commodity prices are as variable and fickle as the affections of your average house cat.

This may be a turning point, since practically all movements have been down for almost a decade. And it’s worth noting Fitch also upgraded its outlook late last year.

Another interest rate hike! ››

The South African Reserve Bank (SARB) implemented another hike in the repo rate of 0.75% on 21 July 2022, the highest increase in two decades. This followed the previous increase of 0.5% in May this year.

This will push the prime overdraft lending rate to 9% which would increase the monthly instalment on a bond of R 2‘000’000 over a 20-year term by approx. R 953 per month.

SARB has set an annual inflation target of between 4 to 6%. According to Stats SA, in June of this year the inflation rate reached a 13-year high, registering at 7.4%.

We have all seen prices rising across the board, from fuel to food, and this is a worldwide phenomenon caused by the shortages of supply that have resulted from the COVID-19 pandemic and more recently the Russian invasion of Ukraine. Inflation is therefore rising worldwide, and interest rates are also increasing worldwide.

Based on these factors, it looks probable that interest rates will continue to rise for the foreseeable future.

Tax filing season opened on 1 July 2022 ››

1 July 2022 – SARS has made significant changes to the 2022 Tax Filing Season. This year, over 3 million taxpayers have been auto-assessed by SARS and will not have to file a tax return if they are satisfied with the outcome. If you are in the auto-assessment group, you have received a notification from SARS during the first few days of July. If you are not in agreement with the assessment, you can access your tax return via eFiling or SARS MobiApp, complete the return, and file it.  This must be done within 40 business days from the date that your assessment was issued to you.  

These are the income tax return filing dates:
– 1 July 2022 to 24 October 2022 for taxpayers who file online 
– 1 July 2022 to 23 January 2023 for taxpayers who cannot file online can do so at a SARS branch by appointment only. Provisional taxpayers including Trusts may file via eFiling or SARS MobiApp.

SARS rejects R 1.8 Bio in home office claims ››

We refer to the article in our August newsletter from last year, referring to the tax-deductibility of these expenses. The flood of claims arose during the Covid-19 pandemic and the lockdown, forcing staff to work from home.

During the 2021/2022 tax period, the tax office received R 2.9 Bio in such claims, of which the bulk was rejected. With over 80’000 tax returns claiming home office expenses, SARS started to examine those much closer. Most rejections were based on the fact that the taxpayer did not have a proper office at home.

There are indications that the tax law will be changed. Amongst other things, there is a proposal to disallow the deduction of interest rate payments on mortgages, as it is probably the largest expense claimed for deductions.

Vantage becomes full subsidiary of Santam ››

With effect from 1 October 2022, Vantage Insurance will change from operating as a 100% held subsidiary company of Santam Limited to a division of Santam. The reason for the change is to streamline compliance and statutory requirements.

Please note that this change does not affect the day-to-day running of Vantage as a going concern and everything remains business as usual. The same terms and conditions and benefits apply, there will be no changes in cover provided and all premiums remain the same.

Vantage has also changed the pricing for vehicle hire and the assist program as follows:
 
VEHICLE HIRE:

Vantage continue to allow up to 45 days rental as a standard offering which remains higher than most competitor products and continue to use the best agents to supply quality vehicles timeously to our select market as an important value contribution.

ASSIST PROGRAMS: 

Please click here to read the summary of their Assist Programs.

Cyber Crime – beware of your responsibilities! ››

According to recent research by cybersecurity firm Surfshark, South Africa was among the Top 10 countries most affected by cybercrime last year, coming in at number 6. South Africa had 52 cybercrime victims per one million Internet users in 2021. Since 2001, the online crime victim count increased 17 times (from six victims to 97 victims every hour!), and financial losses grew more than 400 times, from $2000 to $788 000 in losses per hour.

During the past two years all businesses, and in particular small enterprises and entrepreneurs, have had to step up in the way they protect their digital and data assets.

It is important to note that legislation is in place (POPIA) that could hold you liable if client’s data is stolen by hackers! Section 99(1) makes provision for strict civil claims liability and for fines. Hence companies need to look at how best to protect themselves.

Most insurers offer the following coverage as a consequences of a cyber-attack:

• Data breach and restoration: After a breach, the business may incur legal costs and pay damages to third parties. This extension provides cover for legal defence costs and damages if the case is unsuccessfully defended.
• Third-party liability: This covers your business against any claims that your clients or intermediaries make against your business should they experience a cyberattack on your system.
• Business interruption: The offering is designed to assist owners of small to medium-sized businesses to get their business back on track after a breach.
• Cyber extortion and cybercrime: This extension helps get businesses running as soon as possible after a cyberattack and manages the financial implications because of the ransomware.

The insurers will appoint a specialised case manager that will assist the client through the process and limit the damages.

Please contact Marius Romer or Tony Hug for more information.

HIC implements new claim procedure ››

The insurer has made the following points clearer:

• All claims must be reported as soon as reasonably possible, but not later than 30 days after the event.
• In the case of theft or hijacking of a vehicle, a claim must be reported no later than 7 days after the event.

The following needs to be provided to ensure an expedient claims experience:

Submit your documentation to our office and send it to

MUA provides pet insurance ››

Did you know that MUA provides an automatic extension of cover (under the house contents section of the Executive Policy) for veterinary expenses to the value of R10 000 per year? Please click here to view the details.

Renasa’s commercial assist program explained ››

The insurer provides an extensive road side assistance program. May we please ask all our commercial Renasa clients to download the overview by clicking here and save the emergency contact details.

How to protect yourself against power surge damages ››

Loadshedding has become a part of the daily lives of South Africans all over the country. In 2022, we had 960 hours of national loadshedding and recently reached stage 6, further increasing outages. With increased loadshedding comes a bigger chance of electrical faults that lead to power surges, overloading and shorting electrical appliances.

Most insurers have seen a rise of over 50% in power surge claims and received hundreds of claims in a week. Here are a few tips to reduce the risks of damage to your home contents and navigate around the loadshedding times:

• Unplug appliances when the power goes out. Power surges usually occur when the power comes back on.
• Invest in a surge protector for the distribution board (which should be installed by a certified electrician) and surge protector plug adaptors.
• Buy a power strip with a built-in surge protector. Clients can protect their appliances by simply plugging them in to the power strip.
• Ensure that your alarm system is in a working condition and the back-up battery is fully functional to provide power to the system in the event of load shedding.
• Spare torch or headlamp: Keep a torch in your car in the event that you arrive home at night during a power outage. Most smartphones have a built-in torch or torch apps that come in handy during unexpected power outages.
• Emergency contact information: Save emergency contact information on your phone but also keep a paper copy safe and accessible. This should include contacts for emergency services, such as the fire department, police and/or medical services. Also include the contact information of friends and/or family along with insurance information.
• Charge your cellphone, laptop and tablet: Ensure your cellphone, laptop and tablet devices are fully charged ahead of scheduled blackouts. Be sure to charge them again as soon as possible after the power returns. It’s also a good idea to have an emergency phone charger (like a power bank) close by.
• Gas for cooking and lighting: Get a small LP gas bottle and lamp, which will give good-quality lighting for a large area and can also be used for cooking and boiling water. It’s a good idea to keep hot water in a thermal flask so you can make hot drinks. Also consider preparing meals beforehand if you know when there’s going to be a scheduled blackout.
• Back up your data: It is always important to back up data in case of a hard-drive crash or unforeseen electrical fault. Online cloud-based backups are very convenient and are mostly automated, which means you have one less thing to worry about.
• Don’t leave stoves etc. on during loadshedding. You could cause fire damage once the electricity comes on again.

 
We all need to contribute to reducing claims, if we want to avoid insurers increasing premiums and reducing the cover for power surge damages – as the next article shows.

Santam adjusts power surge cover and excess on all policies ››

Santam is the first insurer that has taken steps and also adjusted their excess structure. We expect more insurers to follow.

Domestic policies:
Removal of the default R 5000 cover limit for power surge. While the premium for this cover forms part of the base premium today, in future power surge cover will be rated separately and will be reflected as such on the policy summary. For new business, power-surge cover will become optional and will have to be selected. For existing business, existing cover limits will remain unchanged at renewal, with the premium payable for power surge split from the base premium and reflected separately on the policy summary.
Excesses for both power-surge and mechanical, electrical and electronic damage cover will increase to R 1500. Note that excesses do not apply to clients 55 years and older.
Changes for new business will be implemented for any new cover with effect from 28 July 2022, and changes for existing business will be implemented at policy renewal from 1 October 2022 onwards.

Commercial Policies:
Power surge: The default R 50000 cover limit on applicable sections of all commercial policies will no longer attract a zero premium but will explicitly be rated from the first rand of cover provided.
Motor Excess: The minimum excess amount will increase by R 1000 for damage, theft and hijacking for certain types of vehicles.
Changes for new business will be implemented for any new cover with effect from 1 August 2022, and changes for existing business will be implemented at policy renewal from 1 November 2022 onwards.
 
Please click here for an overview of all motor excesses on commercial policies.

Geyser replacements: Your plumber needs to supply a Certificate of Compliance ››

Insurers want to make sure that the installation of a geyser was done by a qualified plumber, the parts used are not of a poor quality and that the workmanship is good. Unfortunately there is still a lot unqualified plumbers offering their services.

Most insurance companies have their own list of preferred plumbers that will assist clients with replacements. Should you wish to choose your own plumber, he will have to produce a Certificate of Compliance (CoC). Without the CoC, the insurance company is not going to pay the claim. Some plumbers will argue, that according to SABS, a PIRB CoC is no longer required or they are no longer a member of the association and hence cannot get a CoC. Please note that the insurer can still ask for a CoC which is within the insurer’s rights. Make sure you do not pay your plumber before you have received the CoC!

At this stage, MUA, Western, Bryte, H&U, Santam, Vantage, Elite, Old Mutual and HIC require a CoC, with other insurers to follow suit.

Changes to Business Interruption cover across the insurance industry ››

Reinsurance companies have indicated that they will no longer underwrite Public Utilities (Extended Cover) and Public Telecommunications (Extended Cover).

This means that non-physical damage Business Interruption is no longer available in the insurance market and there are no alternatives available. So if there is no fire, explosion, earthquake, storm etc. at a public utility causing the business interruption, no claim can be submitted.

All local insurers have already communicated the changes to their clients. The cover has been cancelled as from 1 September 2022 on existing policies.

Clarification on hole-in-one cover ››

As you may know, most domestic policies reward a lucky golfer for this achievement.
Whilst 99.99% of most golfers wait their entire life for such luck, others seem to be luckier or maybe just better golfers. Please note that the definition is intended to pay out once only per insurance year, and not per calendar year or from the date of the last achievement. Please also note that this benefit (and some others) is an extension of the house contents cover. If you do not have contents insurance, you cannot claim for a hole-in-one!

Discovery Insure amends excess structure ››

Following the industry trend, Discovery also had to review their excess structure. Please click here to see the overview across all the plans.

Have you installed an inverter or solar panels – don’t forget your insurance policy! ››

The installation of independent power supply items have increased substantially. Please do not forget to increase the sum insured of your building or contents, if you have invested substantial amounts in such items.

Bryte amends hospitality products (BnB Sure) ››

The insurer has updated the policy for owners of guesthouses, BnB and backpackers. May we kindly ask all our clients to click here to read about the changes.

Update on our court case ››

We have received an update from our attorneys at the beginning of August:

It was their strategy to see whether the Department would follow their commitment in processing the long outstanding PR applications since the last interaction with the State Attorney about a month ago. Unfortunately, none of our clients have been contacted by any officials and hence we have instructed the attorneys as follows:

– To give the Department 30 days to process the applications. Please click here to view the letter.
– To order another court date once the 30 days have expired.
Unfortunately the court roll at the High Court in Pretoria is extremely full and the earliest date we could obtain was the 7th November 2022. If the PRs are not issued by then, we hope that there will be a final ruling against the Department.

Should you be contacted by the Department in the meanwhile, kindly forward us such correspondence, so that we can assist. The contact will be made via e-mail.

Automatic visa extension until end of September 2022 ››

Unfortunately the Department of Home Affairs is still experiencing a huge backlog with approving visas. In order to reduce such, the Department has granted another extension until the 30th September 2022.

Any visa application via VFS inside South Africa which has not been processed yet, is now automatically extended until 30 September 2022.

It is important to note that if you travel outside South Africa without the requested visa, you will not be fined or declared undesirable. When you return, make sure you carry a copy of your VFS receipt for admission into South Africa.

Please click here to read the circular.

New procedures when applying for a visa abroad causes havoc ››

One of the main reasons for huge backlog as per previous article, was the introduction of an anti-corruption process by Home Affairs Minister, Mr Aaron Motsaoledi. All long-term visa applications are now adjudicated in Pretoria and not at the Embassies or Consulates abroad.

Previously visa applications took no more than 8 weeks, but applicants have to wait now up to 10 months! Some of the foreign missions want to retain the applicant’s passport which makes it impossible to make travel arrangements!

We do not believe that the Department will be able to clear the backlog, as there are simply no resources at Head Office to process the applications. A further automatic extension of visas is therefore very likely.

Critical skills list amended ››

The Department has just published the amended list – please click here. Nurses, dentists, medical practitioners and industrial pharmacists have been added which should address the shortage of such professions.

BDAE adjusts the Infinity Plan ››

The insurer Allianz Partners will as of 1 October 2022 insure the group insurance contract.
Allianz has been an extremely reliable partner for BDAE and its customers in the area of assistance services for more than a decade. The BDAE recently worked with the company to successfully implement the digital health assistant “Emma”.

Independent of this change of insurer, there are changes in the insurance conditions of EXPAT INFINITY. The country zones for Thailand and Mexico will change from zone 2 to 3, which will increase the basic premium for this insurance. This zone change for new customers was 1 August 2022 and for existing customers as of October 2022. All other countries will remain in the previous contribution zone. Due to the changes, insured persons have a special right of termination as of 30 September 2022.

Microsoft 365 problems – did you receive our mails? ››

The Sub-Saharan region experienced Microsoft problems with delivering e-mails between the 14th and 26th July. We have noticed that in some isolated instances, some of our clients have not received mails from us and vice versa.

Under normal circumstances, we will reply to you within 24 hours. Please contact us should you be one of the affected clients.

Valuable information on personalized vehicle number plates ››

We recently came across an article published by Santam insurance when it comes to applying etc. for a personalized number plate.

Please click here to read the overview.
 

We value your comment ››

Do you want to know about a specific topic, share something with us or comment?
Please feel free to send us an e-mail or so that we can assist you.