16 Dec SwissFin – SwissSure Newsletter December 2022
Another eventful year is coming to an end. A year that was no longer defined by COVID 19 and lockdowns, but has kept us on our toes due to the ongoing problems of the power supply. We will also overcome this hurdle and look confidently into a good and prosperous 2023. We would like to thank all of our clients for your loyal support. We wish you and your family a joyous festive season and a safe arrival to your destinations should you be travelling.
As usual, we have also included information across the board regarding investments, short-term insurance, immigration and other related topics. This newsletter can also be viewed under https://www.swissfin.co.za/newsletters/swissfin-swisssure-newsletter-december-2022
Enjoy the reading, with best regards,
Your SwissFin / SwissSure Team
- Interest rates: Bank deposits, insurance plans, tax-free investment amounts and SwissSure Forex rates
2. LOCAL AND INTERNATIONAL FINANCIAL NEWS
3. SWISSSURE – SHORT-TERM INSURANCE NEWS
- You need your contents insured for hole-in-one cover
- Old Mutual Insure upgrades policy wordings
- Bryte Hospitality (BnB Sure) launches App
- Brace yourself – premium rate increases across the board expected!
- HIC offers extended car hire option
- TRA changes risk carrier
- Insurers clamp down on power surge and electricity grid failure
- MUA requires trackers for certain vehicle models on new policies
- Old Mutual Insure amends commercial policies
- Execuline produces new policy wording
- Successful court case against Department of Home Affairs
- Expired visas valid until March 2023
- Department makes a U-turn on foreign missions approving visas
5. HEALTH INSURANCE
- Discovery Health changes 2023
- Turnberry Details for 2023
- New international health insurance offering
Interest rates: Bank deposits, insurance plans, tax-free investment amounts and our foreign exchange rates >>
We offer the following rates as of December 2022:
Interest rates ››
- Our Money Market Fund
- 7.52 %
- 12 Months bank deposits
- 8.12 %
- 24 Months bank deposits
- 8.25 %
- 36 Months bank deposits
- 8.41 %
- 48 Months bank deposits
- 8.67 %
- 60 Months bank deposits
- 8.98 %
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: ››
- Gross yield
- 6.70 %
- Taxes payable
Tax-free interest income – maximum investment amounts: ››
R 1,78 Mio. for taxpayers under the age of 65
R 2,51 Mio. for taxpayers between the age of 65 and 75
R 2,75 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: 7,0 % effective interest rate and no other income sources.
SwissSure Forex Rates ››
- Bank A
- Bank F
- Bank N
- Bank S
- Our Rate
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.
2. LOCAL AND INTERNATIONAL FINANCIAL NEWS
The Medium-Term Budget Speech ››
Finance minister Enoch Godongwana delivered the 2022 Medium-Term Budget Policy Statement (MTBPS) on Wednesday, 26 October.
The budget touched on many points and topics that were raised in the lead-up to the speech, including the South African government taking over a portion of struggling power utility Eskom’s debt, and giving a solution to the ongoing e-toll problem in Gauteng.
South Africa has also benefitted remarkably from a commodities boom, catching a massive windfall which is now being used to fund different budget items.
These were the main points of the speech:
- Compared to the 2022 Budget, the gross tax revenue estimate for 2022/23 is projected to be R 83.5 billion higher. This is due to higher commodity prices leading to increased tax revenue.
- GDP growth is slowing to 1.9% for 2022 after 4.9% in 2021.
- Godongwana said that the government will be taking on “a significant portion” of Eskom’s R 400 billion debt. While the exact figure is not yet known, he said it will be between one- to two-thirds of the power utility’s current debt.
- The Treasury has allocated the following funds to state companies for bailouts:
– R 23.7 billion for Sanral to pay off government-guaranteed debt, R5.8 billion for Transnet,
– R 204.7 million for Denel to reduce contingent liabilities arising from its weak financial position and R 3.4 billion – if set conditions are met – to complete its turnaround plan.
- The minister announced that the special Covid-19 Social Relief of Distress (SRD) grant will be extended by another year, now until 31 March 2024.
The budget shows that SA is on the brink of debt stabilisation. The national debt will stabilize at 71,4% of GDP this year and then gradually fall, even if the global economy worsens more than expected. This is a tremendous achievement, 2 years ahead of plan, and is a prerequisite for exiting the junk status. This is indeed cause for celebration Mr Finance Minister!
D-day looms for FICA action ››
South Africa has until 28th February 2023 deadline to amend its Financial Intelligence Control Act (“FICA”), or the country could be put on a damaging grey list. This would be alongside countries like Yemen, South Sudan, Albania, Burkina Faso, Pakistan and Haiti amongst others.
The Financial Action Task Force (FATF) is an independent body situated in Paris/France, which develops policies to protect the global financial system against money laundering, terrorist financing and similar criminal activities.
When South Africa was evaluated in 2019 on 40 checkpoints, our Government was non-compliant on almost half of them. Treasury and Parliament are working on amending the FICA Act but seem to be running out of time.
A grey listing could mean that disinvestment would occur in financial institutions, combined with a weakening Rand currency.
And more interest rate hikes ››
The reserve bank announced on 22 September a further 75 basis points increase in the interest rate (0.75%). This was followed by another one on 24th November 2022 by an additional 75 points, bringing the repo rate to 7%, the highest level in 5 years.
3. SWISSSURE – SHORT-TERM INSURANCE NEWS
You need your contents insured for hole-in-one cover ››
Most short-term insurance companies offer a reward for a hole-in-one at golf or a full house when playing bowls.
Please note that this extension falls under your household goods / contents cover. This means, that without contents insurance, you do not qualify for the rewards.
Old Mutual Insure upgrades policy wordings ››
The insurer OMI has amended the following policy wordings. For our clients with OMI policies, please click below to see a summary of the new wordings:
Should you have any questions regarding the changes, please do not hesitate to contact our short-term insurance department.
Bryte Hospitality (BnB Sure) launches App ››
The Bryte Hospitality Assist app is available on Android (Google Play) and on the Apple Store as well. Once downloaded, the policyholder must register and complete the process, thus identifying themselves as insured by Bryte. Various functions connect you to the Assist line and your policy information.
Brace yourself – premium rate increases across the board expected! ››
Most insurance companies have not shown great half-year results.
A significant contributor to claims were the devastating floods that affected KwaZulu-Natal during April 2022.
In addition to the floods, operating results were influenced by heavier than normal rain in the north, a sharp rise in power surge and accidental damage claims, and above-inflation increases in vehicle parts and servicing that was influenced by supply chain delays and Rand depreciation.
We expect claims frequency trends to remain and grow from pre-pandemic levels, with particularly high building and vehicle inflation and weaker exchange rates continuing to put upward pressure on claims costs. The severity and extent of global and local catastrophe events is also expected to have a material impact on reinsurance premiums.
Insurance companies will be forced to increase premium rates very soon.
Santam has issued a summary of the factors that is challenging the insurance market, which you can read here.
HIC offers extended car hire option ››
TRA changes risk carrier ››
Insurers clamp down on power surge and electricity grid failure ››
All insurers have seen a sharp rise in claims due to load shedding, with some companies receiving up to 1600 claims per month. The following insurers have implemented the following changes:
Following a review in respect of the above covers, the insurer has decided to implement key changes that are necessary due to the frequency and severity of losses related to flooding and load shedding. These changes apply to all policy contracts across the commercial and personal lines product portfolios.
All the changes are subject to the terms and conditions stipulated in the policy wording and have come into force on 1st December 2022. Please click here to read the circular.
The pricing structure for this cover is being ammended from 1 January 2023 as follows:
– Clients that have included the accidental damage and power surge optional benefit benefit on their plans, under their household contents cover, will receive a premium increase of R 60 per month.
– Clients with both the optional accidental damage and power surge cover as well as buildings cover on their plans will receive a total premium increase of R 90 per month.
– Clients that are covered for their buildings but who have not included the optional accidental damage and power surge benefit on their plans, will receive a total premium increase of R 60 per month.
Your clients updated plan schedule will be available online by 30 November 2022.
For any questions, please do not hesitate to contact our short-term insurance department.
The grid failure exclusion will be implemented for all Personal Lines and Commercial Lines policies in South Africa and Namibia as follows:
– All new business quotations requested on or after 1 January 2023 and 1 March 2023 for commercial policies.
– All policies renewing on or after 1 April 2023 and commercial policies from 1 June 2023.
For domestic policies, the exclusion will apply to the contents of refrigerators and freezers.
Cover limits for Business Interruption Public Telecommunications – insured perils, and Public Utilities – insured perils, will be limited to the lower of 50% of the Business interruption cover limit and R25 million, VAT inclusive, with a 3-month indemnity period limit.
Please click here to view the wording changes.
The insurer has amended the terms for their domestic and commercial policies (click here to view details – here and here) with regards to the electricity grid failure. Please note that the power surge cover is still in place.
It is highly likely that more insurers will follow with further limitations on such type of cover.
MUA requires trackers for certain vehicle models on new policies ››
The insurer’s data indicates a marked increase in the theft of certain vehicles over the past few months. Please be advised of the following vehicle tracking requirements on all new policies, effective immediately for the following vehicles:
– Toyota Hilux
– Toyota Fortuner
– Toyota Landcruiser
– Toyota Prado
– All Lexus models
– Ford Ranger
– Volkswagen Polo
The following conditions apply:
– These vehicles cannot be insured if they are usually parked on street overnight – they need to be parked either behind secured gates or in a garage or in a security estate.
– Where the vehicle value is less than R 500’000, a 10% excess in the event of theft and hijacking will apply. This excess will be waived if an MUA-approved tracking device was installed and in working order at the time of the loss.
– For any of these vehicles where its value is more than R 500’000, the following will apply: An MUA-approved tracking device is a requirement, and a client receives 14 days grace (from date of inception) to get such a device installed. In the absence of an approved tracking device (or if the device was not in working order), theft or hijacking of the vehicle will not be covered.
The following devices are approved by MUA:
Matrix M2 or M3, Netstar early warning, Tracker care and Bidtrack High Alert.
If you need any further information, please do not hesitate to contact our short-term department.
Execuline produced new policy wording ››
The underwriting manager, insured via Hollard, has updated their policy wording. All clients can click here to download the latest version.
Successful court case against Department of Home Affairs ››
At the court hearing on 7 November 2022, the representatives of the Department of Home Affairs did not appear in our class act suit and the judge ruled in our favour.
The actual copy of the stamped order will be uploaded by the Registrar herself. We will share this with you once received.
The effect of the order is that the DHA must finalise all the PR applications within 30 days (which has already started), failure to do so would mean that the Minister of Home Affairs & the Director General of Home Affairs can be held to be in contempt of Court, which is a criminal offence.
Unfortunately, we received some PR rejections last week, which were unlawful. But it means that we must deal with them separately in terms of the appeal process.
We will keep you posted on further developments.
Expired visas valid until March 2023 ››
As expected, the Department has not been able to reduce the backlog with visa applications.
Home Affairs Minister, Aaron Motsoaledi, has issued another directive to extend the validity period of legally issued visas, which have or are now expiring, to 31st March 2023. Please note that a visa extension must be pending in order to benefit from the blanket exemption.
Please click here to read the circular. Holders of such visas are permitted to remain in the country under the conditions of their visas.
Department makes a U-turn on foreign missions approving visas ››
At the beginning of this year, the Department instructed their Embassies and Consulates to no longer work on visas, but to send the applications to Pretoria for adjudication. Because this proposal was not well thought through, the result was a massive backlog in Pretoria. Head Office finally realized the mistake and reversed the instructions in August this year. Please click here to read the circular.
5. HEALTH INSURANCE
Discovery Health changes 2023 ››
Coming into the new year, Discovery Health Medical Scheme offered a 0% increase for the first four months of 2022, on all health plans. In February 2022, Discovery announced that the claims and investment experience for Discovery Health Medical Scheme were better than anticipated, allowing the Scheme to defer the 2022 contribution increase by another five months from 1 May 2022 to 1 October 2022. This meant you could enjoy 2022 benefits at 2021 contributions for the first nine months of 2022.
The contribution increase effective 1 October 2022 will remain at 7.9%, to make sure that contributions remain on par with future medical inflation while giving you financial relief through the delayed contribution increase.
For more information, please visit www.discovery.co.za.
Turnberry Details for 2023››
Please click here to read the plan comparison between 2022 and 2023.
New international health insurance offering ››
We have concluded a new contract with Foyer Global Health, who is based in Luxembourg. If you would like to know more about their health insurance offering, please contact Tony R. Hug or Savanha Conrad .
Our office hours over the festive season ››
Please note that we are open on normal working days Monday – Thursday from 08.30 am to 16.30 pm and Fridays 08.30 am – 16.00 pm. Our offices will be closed from the 23rd December 2022 from 12.00 pm and we will reopen on the 3rd January 2023 08.30 am.
Should you have an emergency during the above period, please contact the following short-term insurer’s emergency numbers:
Renasa Domestic: 0861 628 328 or 083 791 0201
Renasa Commercial: 0861 736 266 or 083 791 0164
BnB Sure / Bryte: 0800 55 66 77 or 0861 976 656 (Hospitality Assist – includes cover for home and roadside emergencies)
Execuline / Hollard: 0860 103 434
HIC: 011 455 8528 or 011 455 5271
MUA: 0861 000 682 – 24 hour contact centre, after hours, weekends & public holidays
MUA: Geyser claims 0861 682 467 – during office hours
Old Mutual Insure / Elite: 0860 247 365
Santam: 0860 505 911
Vantage: 0800 214 763
Western: 0860 400 007
HLU: 0861 227 627
CIA: 087 135 1222
Hollard Roadside assist 0860 038262
Hollard Geyser Hotline 021 702 0442 (Fogi Plumbing)
AIG (Chartis): 0860 005666
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