As South Africa’s short-term insurance landscape continued to evolve in 2025, PSG Insure observed several persistent and emerging risks affecting local businesses, says Ryno de Kock, Head of Distribution at PSG Insure. By reviewing some of these risks, we can extract valuable lessons to guide risk-mitigation strategies in the year ahead.

1.     Fires

Fires remained one of the most financially damaging risks for businesses in 2025.

“Fires can lead to full operational shutdowns, long-term business interruption, and costly asset replacement,” says de Kock.

Many incidents are linked to electrical faults, aged wiring or overloaded systems. Others stemmed from inadequate maintenance of fire-suppression equipment or non-compliance with safety regulations.

This reinforces the importance of adhering strictly to compliance requirements, maintaining fire-detection systems, and ensuring regular inspections. Businesses operating in industrial environments or storage facilities benefit from reviewing their risk-mitigation protocols, including clear housekeeping practices and proper separation of hazardous materials.

2.     Cyber and digital risks

Cybercrime continues to pose a risk to businesses with email compromise, ransomware and phishing attacks among the most reported incidents across various industries. Small and medium-sized enterprises (SMEs) are particularly vulnerable, as many lack formal cybersecurity frameworks or rely on outdated software.

“This underscores the need for multi-layered cyber risk management, including strong authentication controls, regular software patching, and employee training,” he explains.

Cyber insurance has become a crucial safety net, helping businesses recover from operational downtime, data-breach costs, and financial loss.

3.     Climate and extreme-weather events

South Africa faced another year of unpredictable and severe weather events, including localised flooding, strong winds and storm damage. These incidents were particularly disruptive for the retail, agriculture and manufacturing industries.

Insurers have increasingly turned to data-driven tools such as geocoding to assess exposure more accurately. This involves mapping properties against weather-risk patterns and emerging climate models to determine whether certain areas are likely to experience higher losses in future.

4.     Infrastructure degradation

Ageing infrastructure continued to affect businesses across the country, from water damage caused by burst municipal pipes to losses resulting from power instability and grid-related faults. These incidents often had knock-on effects, including fire risk, equipment failure and stock losses, pushing the need for updated maintenance plans and surge-protection measures.

De Kock notes that advisers play a critical role in helping clients understand how exclusions regarding grid failure, wear and tear, and poor maintenance apply. In addition, professional advisers equip businesses with guidance on how to comply with insurer requirements and what they can do to protect equipment and premises from predictable infrastructure issues.

5.     Vehicle and transport-related losses

Transport-related risks such as accidents, theft of cargo, and hijackings are still prevalent, particularly for businesses operating delivery fleets or relying on regular goods movement. There has also been a rise in opportunistic crime targeting logistics vehicles in some regions.

Businesses that invested in risk-mitigation strategies such as telematics, driver-monitoring tools, and structured fleet-management programmes generally experienced a seamless claims experience and gained greater insight into their risk exposure.

“No matter the risk, working closely with an adviser remains one of the most effective ways to navigate the evolving landscape,” he says.  “Advisers can assess changing exposures, explain policy updates, and help tailor solutions that keep businesses resilient in 2026 and beyond.”