By: Sakkie Stoltz, Bestsure

In recent years, the entire world has experienced an array of changes and challenges. In South Africa, we too find ourselves grappling with these shifts, from the impact of COVID-19 to enduring periods of load shedding. It seems we are living in uncertain times... Absolutely unsure!

Uncertainty permeates various aspects of our lives, from our businesses and work to our education and finances.

Adapting to new changes isn't always our strong suit, is it?

Let's take a moment to reflect on the evolution of technology over the years. Could you have imagined back in the early '80s that one day you'd be able to communicate wirelessly, without being tethered to a cord? Technology has continued to advance, and in today's world, it's an essential tool for communication.

Similarly, the way we conduct business has undergone significant transformations. Specialists consistently emphasize the need to adapt to these changes, as failing to do so could jeopardize the existence of our businesses, our work, our education, and more.

What's changed In the Sectional Title / HOA Industry?

The community scheme industry, encompassing Sectional Title and Homeowners' Associations (HOAs), has also experienced notable changes over recent years. While the list of alterations is extensive, here are the top five, in no particular order:

Infrastructure Failure: Persistent power outages and deficiencies in basic service delivery have posed on going challenges. These issues lead to security breaches, inconvenience, damage due to load shedding and power surges, and much more. Solar installations have become increasingly popular, but they, too, present their share of challenges.

Legislation: Amendments to the Sectional Title Act and the introduction of the Community Scheme Ombud Services Act in October 2016 have introduced new compliance requirements for Body Corporates. These include maintenance plans, valuations, and fidelity cover.

Weather Patterns: Unprecedented weather patterns and storms have emerged in recent years, including tornadoes, heavy rainfall, and flooding in regions where such occurrences were previously rare.

Insurance Requirements: Due to infrastructure failures and changing weather patterns, insurers have tightened their requirements, driven by high loss ratios. It's important to remember that insurance companies are businesses, and if they can't turn a profit, they may impose stringent measures or even cancel policies.

Liability: There has been a notable increase in indemnity claims against trustees. This trend reflects a heightened focus on legislation, and there's a growing understanding of the liability and responsibilities carried by trustees and directors of community schemes.

Finding Solutions

To the Challenges: So, what's the solution to these evolving challenges? Here are some essential pointers that can assist trustees of sectional title schemes and directors of Homeowners' Associations in making informed decisions while mitigating liability:

Building a Specialized Team: Surround yourself with specialists, including contractors, managing agents, and insurance brokers who can add value to your scheme. Don't hesitate to request references from these service providers.

Invest in Education: Beyond understanding your legal obligations, educate yourself on available solutions that can help you make informed decisions for the betterment of your community scheme.

Comprehensive Risk Awareness: Ensure that you and your fellow trustees are fully aware of all the risks involved in your scheme.

At Bestsure, we are committed to providing solutions to our clients, offering peace of mind in these uncertain times. We offer workshops and training to empower you with the latest industry insights and keep you informed about any changes. Our robust risk management approach ensures that your insurance addresses all your needs, leaving no stone unturned.