Making sure Lloyd’s becomes the major global hub for specialist insurance and reinsurance is at the heart of an ambitious new strategy for the historic insurance market, unveiled today.

Called Vision 2025, the strategy was launched in the Lloyd’s building’s famous Underwriting Room at a special event attended by Prime Minister David Cameron.

Vision 2025 sets out bold plans to grow Lloyd’s business, especially in the faster growing markets, and to truly internationalise the Lloyd’s underwriting community.

Lloyd’s Chairman John Nelson said: “Our Vision 2025 is a rare breed in these challenging economic times. It is a strategy for growth.

“Lloyd’s is a profitable international business but we want to make sure we become the true global hub for specialist insurance and reinsurance.

“Vision 2025 will be a real challenge for the Lloyd’s market to execute. The benefits, though, could be substantial, not only for Lloyd’s but also for the City of London and the UK economy.”

Prime Minister David Cameron said: “I welcome the drive and ambition with which Lloyd’s is pursuing plans for where it wants to be in 2025. This is a great example of the bold and dynamic approach we need as we work to foster sustainable economic growth across the country.”

Lloyd’s Vision 2025 is the result of consultation with the Lloyd’s underwriting market and its customers, the brokers. The highlights are:

• Lloyd’s to be the global centre for specialist insurance and reinsurance
• Growth of Lloyd’s premium from its established markets will be at least in line with the GDP growth for those markets – but greater growth will be achieved from the faster growing markets
• The capital base of the Lloyd’s Market will be more diversified, with a greater contribution from the leading growth countries
• The Lloyd’s underwriting community will be truly internationalised with a substantial number of overseas nationals in the market
• Lloyd’s will be a broker market, making maximum use of brokers’ international networks
• Lloyd’s will have a small number of powerful overseas hubs in certain major overseas markets

This will have the result that the City of London will become the major global centre for specialist insurance and reinsurance.

Lloyd’s Chief Executive Richard Ward said: “Lloyd’s strength is drawn not just from history and experience, but from constantly innovating and adapting.

“This vision sets out ambitious plans for the Lloyd’s market to grow, internationalise and diversify. The level of interest among high quality overseas insurers in coming to Lloyd’s is high, but we will be managing the entrance of these new providers carefully. This is a strategy of steady progress, not rapid revolution.”

The vision is dynamic and will be kept under review.

Investors today are faced with a wide range of funds and managers, making the decision to invest offshore a daunting one.  Glacier International is able to take clients through a risk-profiling exercise and thereafter provide guidance on which funds to choose.  Investors will be placed in one of three risk profiles (cautious, moderate or aggressive), each of which has a list of five or six funds from which to choose.  All are daily traded, actively managed funds which simplifies choice, administration, and ensures liquidity.

Navigate by Glacier International is offered as an investment option within the Global Life Plan, thereby giving investors all the associated benefits of investing within a life plan.  Due to the structure of the investment, no tax is incurred within the plan for any income (interest or dividends) or capital gains.

There are estate planning advantages too.  By investing via an offshore life plan issued by a South African life company, investors ensure that the investment forms part of their South African estate, thus avoiding the complications of having part of their estate located offshore.

According to Andrew Brotchie, head of product and investment, “A further enticing factor is that in most cases clients wanting to invest funds up to R1m are no longer required to obtain a tax clearance certificate, making the administration process a lot simpler.”

The funds on the Navigate option are offered at a reduced, flat administration fee of 0.3%, including custody fees.  The minimum investment amount is 25 000 US Dollars, Euros or British Pounds.

“Many industry experts agree that now is a good time to invest offshore,” says Brotchie.  “Returns from global investments over the past 10 years have typically not been good, but expectations are that the next decade will see a reversal of this trend.  Valuations are currently generally more attractive overseas than they are locally and we believe there is value to be found in international investments.”

Glacier International is a division of Glacier by Sanlam.

John Nienaber has been appointed Country President, South Africa. Bringing 12 years of insurance industry experience, John was Executive Head, Business and a Board member at Stalker Hutchinson Admiral until 2011, where he oversaw underwriting and operations at one of South Africa’s leading underwriting agencies in the casualty insurance sector. Previously, John held various roles at Glenrand MIB, an insurance broker.

John will report to Andrew Kendrick, Chairman, ACE European Group. The appointment takes place with effect from 1 June and remains subject to regulatory approval.

At the same time, Gary Jack, Interim CEO, South Africa has been promoted to the newly created position of Chief Operating Officer and Head of Accident and Health, South Africa, also effective 1 June. Gary has seven years of insurance industry experience and joined ACE in 2009 with management responsibility for the Accident and Health business in South Africa before being appointed to his current role. Gary will report to John.

Andrew Kendrick, Chairman, ACE European Group, said:

“South Africa has a young population, a rapidly expanding middle class and an increasingly important position at the heart of global trade. Despite the country’s challenges, we believe these three trends are together capable of powering future growth on a significant scale. Today’s appointments will result in an expanded management team and a renewed commitment to growth in South Africa, a key country in ACE’s strategy of expansion across EMEA’s emerging markets.”

Brian Seach, Chairman, ACE South Africa, commented:

“John Nienaber and Gary Jack bring a formidable and complementary skillset to our South Africa management team. John’s extensive underwriting background, market relationships and extensive casualty and financial lines experience will be valuable assets as we grow ACE’s corporate insurance business. Meanwhile, Gary has been instrumental in the development of our growing Accident and Health business and I am grateful for his effective management of our South African operations over the interim period.”

ACE has been active in South Africa since 2006. ACE specialises in casualty, financial lines, accident and health and property (including energy and construction) insurance, including in South Africa’s rapidly expanding small business sector.

Africa – the continent of opportunity

Although South Africa has both an English and Dutch heritage, with respect to trust law, the Roman Dutch principles have been the ones that have been exclusively applied. In this first STEP conference to be held in South Africa, some of the unique features of South Africa’s Roman Dutch system of trust law will be explored. This will include a case roundup as well as a practical look at South African trust clauses and a keynote address on the most important trust case to come from the South African courts in years. In addition, there will be detailed discussions on two important Southern African off shore financial centres, as well as other areas of interest such as how off shore trusts affect South Africans and South Africa’s foreign exchange control system. Finally, the conference will explore the latest issues of interest from the off shore world.

Conference Programme Focus:

• Professor VD Westhuizenʼs view of bad trust clauses

• Trusts and divorce

• Tax Information Exchange and the future

• Estate planning for the Indian family

• South Africans and off shore trusts

• A roundup of recent trust cases in South Africa

• A roundup of recent trust cases from around the world

Plus:

Sessions providing six in-depth country updates, a look at Foundations, Shams and special off shore trusts, as well as panel discussions on good reasons for setting up trusts and practical war stories on trusts.

Keynote Speaker

The Honourable Judge Zulman, Retired Judge, Supreme Court of Appeal, South Africa

Accredited for 12 hours CPD

Download the full brochure here: STEP South Africa Conference 2012 – brochure or visit us at www.step.org/sa2012

Vodacom is able to leverage the direct links it has with its more than 30 million customers and dramatically reduce the costs traditionally associated with acquiring and serving customers. These savings enable Vodacom to extend greater value to its customers. Vodacom is also recognised as one of South Africa’s most trusted brands, which is likely to be a major benefit when it comes to attracting customers who are looking for insurance products.

“Our insurance business proposition is simple; we are focused on providing Vodacom customers with unbeatable value. Our customers will benefit from the value and convenience that we are able to offer. The vision is to dissolve the barriers to entry for all South Africans previously unable to access insurance products,” says Mark Taylor, Managing Executive of Vodacom Financial Services.

As part of the strategic decision to enter the insurance market, Vodacom appointed FRANK.NET, South Africa’s fastest growing direct life investment company which is owned and capitalized by Liberty Holdings, to provide administrative and claims support for its long term insurance offering.

“FRANK.NET is a good fit for us.  The company has a proven track record in the long term insurance industry with the latest technology platforms and innovative ways to provide an excellent customer experience. We are excited about the depth of experience that FRANK.NET will bring and believe that they will provide excellent service that our customers expect,” says Taylor.

FRANK.NET’s direct capability is purpose built to support the delivery and administration of insurance programmes and it currently does so for a number of enterprises.

FRANK.NET CEO, Lenerd Louw, said: “We are pleased to work with Vodacom to support their new long term financial products offering. The scale of FRANK.NET’s direct capability enables us to easily support the delivery and administration of insurance programmes to help Vodacom leverage from our proven affinity platforms. We look forward to supporting Vodacom as they grow and develop exciting new products to address the financial needs of the South African population.”

Vodacom is looking at providing a full suite of insurance products relevant to its customers. Further details will be provided closer to the time of launch.

In response to broker requests and changing market needs, Etana Specialist Risks has created a cutting-edge, competitive and innovative Event Liability cover for event organisers.

Etana’s Event Liability Protection insurance is designed to meet the challenges of continually changing legislation and incorporates:  Public Liability; Products Liability – including defective workmanship; and Employers’ Liability with policy language that is user-friendly and easily understood.

Here’s a focused Q&A for brokers

Below are some of the questions brokers have asked – but the ‘Q&A’ in this case also stands for ‘Quick and Awesome’ which includes quick quotes and awesomely competitive premiums.

In today’s challenging and fast-paced world, you’ll be glad to know our specialist underwriting expert, focused on event insurance, delivers streamlined turnaround;  and awesomely brilliant guidance; and premiums with free automatic extensions will give you the competitive edge.  All this with no call centres involved to drain your brain, energy and time.  No matter where you are in the country, our 20 Local is Lekker branches oil the wheels for you.

The short and sweet answers you need to know are:

Precisely what does this product do?

The Event Liability Protection wording provides cover for claims against the Event Organiser for bodily injury, mental anguish and property damage to spectators or participants.

In what ways is this product better than what is currently available?

At no additional premium, Etana has included the following automatic extensions (benefits) which are normally restricted:

• We extended the definition and coverage of Bodily Injury to include nervous shock and mental anguish.
• Food and Drink consumed at the event is included.
• Any First Aid Treatment performed by or on behalf of the Insured is included.
• Legal liability in the event of a fire that spreads and causes damage to property or injures  people is another great benefit is that is automatically included.
• Cover is extended to include bodily injury to persons where force was used or considered excessive and gratuitously violent in nature.
• Etana has extended the claims notification period to three months instead of the 15-30 days which is commonly required. Etana feels 3 months is a more ‘reasonable period’ and is fairer to brokers and their clients.
• We also do not have a sexual assault or AIDS exclusion clause.
• We offer indemnity limits up to R100 million.

Does this product give brokers a competitive edge?  If so how?

Yes! Absolutely! Brokers can now offer higher limits and a quicker turn around for quotes. Our specialist and experienced underwriter in this category is Tiaan Erasmus, Etana Specialist Risk, whose valuable advice to brokers will include the covers needed to be effective for their clients’ individual needs. We also have a dedicated IT system which allows Tiaan to quote and issue a policy in one streamlined operation – saving time for brokers while also giving them an efficiency edge.

Does it give tailored and specialist cover designed to suit a specific event?

Yes it does … in addition to the free and automatic benefits mentioned above. The Insured can tailor the coverage to include the following extensions:

• Products Liability (including Defective Workmanship and Gratuitous Advice) – this is where the Insured or Event Organizer’s products or defective work cause damage to other people or property once it’s been handed over.
• Wrongful Arrest and Defamation covers the Insured in a situation where a person alleges they have been wrongfully arrested and defamed.
• Damage to leased and rented premises includes the venue and damage to plant life.  This is often an important extension as this coverage provides cover for damage to property that does not belong to the Insured such as a hired venue where the organisers or spectators cause damage to the venue, as well as plant life, for which the insured is legally liable. Statutory Legal Defence Costs covers the Insured for any alleged breach of statute.
• Emergency Medical Expenses; this is where the Insured incurs costs to have someone transported to a hospital should they get injured. It is important to remember that the Insured must be legally liable.
• The Member-to-Member Liability cover is unique to Etana’s liability product. It covers the Insured against claims where one club member may sue another club member for alleged injury or damage.
• Collapse of temporary Construction and Scaffolding is also very an important extension; it covers the Insured if, for instance, the temporary stage, seating, or marquee tent, collapses and injures spectators.
• Lastly, the Sub Contractors extension ensures that any sub-contractors, not only the insured,  are also covered by this insurance.

What does this product do which has been missing in the past?

The product provides wider coverage at the same cost and is also flexible.  Etana can cover once-off events or cover the Insured for multiple events throughout the year.

What are the benefits to brokers?

In addition to being able to offer additional and free benefits to their clients, Etana offers a time-saving and reliable one-stop-shop through 20 branches around South Africa which excludes the frustration of call centres. Etana offers Broad Form Liability to manufacturers and now expert underwriting and advice for event organisers.  Etana’s A+ credit rating and quick claims turnaround time assist in a brokers challenge with customer retention.

The quarterly survey, which tracks the confidence levels of nearly 6 000 of South Africa’s graduate professionals, revealed a 6% year-on-year decline in the number of professionals who are confident of remaining in South Africa for the foreseeable future to 78% from 84% a year ago. The figure was also down 5% on the previous three months.

According to Gerhard Joubert, Head of Group Marketing and Stakeholder Relations at PPS, while a confidence level of 78% is still very positive, it is concerning that this figure has declined. “Graduate professionals such as doctors, lawyers and accountants are a crucial segment of the economy and like many other countries we already face a major skills shortage within these professions. It is crucial that the concerns of this segment are taken into account to ensure that we do not lose further scarce skills.”

Confidence in the standard of education in South Africa improving over the next five years was also down 2% to 48% year-on-year, although it remains unchanged on the previous two quarters.

However, Joubert says even more alarming for graduate professionals is the lack of mathematics and science graduates in South Africa with 94% of respondents citing this as a concern. “Many of our skills shortages are in professions that require a mathematics or science degree so it is critical that we address the reasons for fewer people opting to study these subjects, as fewer graduates in these fields now will lead us to an even greater skills shortage in the future.”

Confidence that unemployment would improve over the next five years also fell 4% year-on-year to 42%. Joubert says the recent Labour Force Survey that showed South Africa lost 75 000 net jobs in the first three months of the year indicates that there is a good reason for such concern.

Confidence in the future of the healthcare system over the next five years fell 5% to 45% year-on-year. The deterioration in confidence is reflected by concern over the implementation of the National Health Insurance initiative with 84% of respondents saying it is not the solution to fix the country’s ailing health system.

Joubert says members of PPS have previously voiced their concern that the NHI Green Paper in its current form does not provide sufficient detail on the proposal and that an efficient private sector is an essential component of the healthcare system. “Many graduate professionals support the principle of improving the healthcare system for all South Africans to ensure better healthcare for all citizens but are concerned over the way it is being implemented. Further consultation on the issue is vital to ensure all stakeholders buy into the process.”

The survey also revealed a confidence level of 60% among graduate professionals on the issue of whether they have saved enough to retire comfortably.

“This is concerning, as it means that well over a third of graduate professionals have not saved sufficiently for their retirement, are aware that their current retirement savings rate is inadequate or – more worryingly still – are unsure of what their savings rate should be,” says Nick Battersby, CEO at PPS Investments.

“We welcome Government’s proposed retirement reform to address South Africa’s low savings rate, but also encourage investors to consider not only whether they are saving enough, but also whether they are saving appropriately.”

91% of respondents said they do not feel tax incentives currently offered by the government are sufficient to encourage South Africans to save, while 64% also said they believe that compulsory preservation is necessary to improve the situation.

Other results from the survey

· Confidence about the future of their profession over the next 5 years was 80%

· 61% of respondents said they would encourage their children to enter their profession

· Confidence in their ability to earn an income that keeps up with inflation was 70%

· Confidence in the economic outlook for South Africa over the next 12 months was 62%

· Confidence in the outlook for local equity / share markets fell to 63% from 71% a year ago

· Confidence in crime rates improving over the next five years fell to 43% from 45% a year ago

“Ms Dikokwe has a great work ethic and sound understanding of the industry and I look forward to working with her in her new capacity,” said Mr Chanetsa.

Ms Dikokwe holds a B Comm. degree from the University of the North West. She has extensive regulatory experience gained over the 12 years she has been with the FSB. She joined the FSB in the year 2000 as a junior analyst, progressing through the ranks to occupy the position of senior manager with responsibility for the regulation and supervision of CIS managers in 2007. Ms Dikokwe actively participates in the legislative harmonisation initiatives undertaken by the Southern African Developing Community (SADC) through the Committee of Insurance, Securities and Non-Bank Financial Authorities (CISNA). She has represented the FSB on various platforms, with the aim of ensuring the application of the best regulatory practices in South Africa.

“The main challenge of my new job is to ensure that the FSB remains an effective CIS regulator that is able to enforce legislation, develop practical and legal frameworks for business areas, including alternative investment schemes, and maintain professional and yet cordial relations with players in the CIS industry. I am confident that with my competent team, we will meet the objectives we have set for ourselves,” said Ms Dikokwe.

After a rigorous evaluation and selection process, Astute (switch provider for the Life Insurance Industry) was appointed as the technology partner to STRIDE early in 2011. The first phase of the switch delivery was planned to be implemented by April 2012 and through hard work and dedication by the project team, this tight deadline date was achieved. After signing off the testing on the 12^th April 2012, the long anticipated STRIDE switch went into production on Saturday 21^st April 2012.

This means that both brokers and insurers will be able to share and access policy, claims and financial information in a batch format. “This enables compliance to Binderholder Regulations by the specified date of January 2013” says Deon Olckers CEO of STRIDE.

Potential participants are reminded that this is an industry owned and managed solution. All the necessary processes are in place to ensure absolute security and integrity of the data and no parties other than the intended recipient of the data will have access to the detail of the message being processed. Transactional costs will be kept as low as possible and there will be no additional costs such as monthly or annual subscriptions that will be incurred.

Participating in the switch requires mapping data to the SA ACORD AML standard, development to integrate with the technology and the completion of a certification process. Although various experts are available to assist organisations with this process, participants are reminded that this could be a lengthy process (it is estimated that an internal project could take up to 6 months) and with the Binderholder Regulations compliance date set at January 2013, you have no time to waste! The STRIDE team can be contacted to assist you with your planning.

What better way to play a critical role in the sustainability of the South African Short Term Insurance Industry than to contribute to the development of an industry owned and managed data switch? The implementation of the South African ACORD Data Standard will unlock the hidden potential in risk data while the STRIDE switch facilitates communication across channels.

Phase 2 of the solution will enable real-time bi-directional communication of business process messages, from quote request to cancellation. “This development is already initiated and is expected to be in place by January 2013 to unlock business value over and above compliance” says Olckers.