Many people believe that only the family breadwinner needs to have life, disability and severe illness cover. This view is fundamentally flawed, a financial planning professional says.
Craig Torr, director at Cape Town-based financial planning practice Crue Invest, says that just because the stay-at-home partner does not earn an income does not mean the family would not suffer financial loss if that person were to die or become disabled.
“According to our financial planning principles, we believe in preparing a joint financial plan for both spouses – irrespective of who works, who doesn’t, or how much each earns,” Torr says. “Regardless of income, qualification or career, the couple is running a joint household and is jointly responsible for the financial future of the family.”
Torr takes as an example a family of four, where the wife is the sole breadwinner and, by mutual agreement, the husband is a stay-at-home father to the couple’s two small children. The natural, and correct, assumption is that the wife would require assurance in the event of her own death or disability, Torr says. If she were to die, she would need her life cover so that her husband could maintain the family’s standard of living , invest for the children’s education and fund his retirement. If she were to become disabled, she would need her disability cover to pay her a monthly income until she reaches retirement age. And if she were to suffer a debilitating illness, she’d probably also require lump-sum severe illness cover to provide capital to cover the additional expenses.
“However, many couples fail to ask the question: what would happen to the working partner and children if something happened to the stay-at-home partner – in this case, the father?” Torr says.
A host of functions would have to be replaced, he says. The stay-at-home parent’s job description is likely to include performing household chores, grocery shopping, paying and managing domestic workers, lifting children to and from school and extra-murals, liaising with schools and teachers, supervising homework, and preparing meals and school lunches.
“The reality is that a full-time father might not earn an income, but he does work. His role is the most important job on Earth,” Torr says. If the husband were to die, questions the breadwinner wife would need to consider are:
• Would I have to hire an au pair or a child-minder to take care of the children in the afternoons?
• Would I need to hire a tutor to help my children with homework?
• What would happen during school holidays? Would the children go into holiday care, or could I rely on other members of the family to look after them?
• Would I need to hire a domestic worker (or increase domestic help) to prepare meals ?
• Would I consider cutting back on my hours of work in order to spend more time with my children?.
• Would I consider having my parents (or in-laws) move in with me to assist with the children?
Torr says: “Our society, in general, undervalues the role of the stay-at-home-parent, and this is never more evident than in the field of financial planning. In the words of GK Chesterton, ‘How can it be a small career to tell one’s own children about the universe? How can it be broad to be the same thing to everyone and narrow to be everything to someone? No, a [stay-at-home parent’s] function is laborious, but because it is gigantic, not because it is minute.’”
The reality is that the loss of a stay-at-home parent is greater than anyone can quantify, and you need to consider risk cover for that person too, Torr says.
Needs-matched cover for stay-at-home parents
Schalk Malan, the chief executive of life assurer BrightRock, says although his company is not the only provider to insure stay-at-home parents, its needs-matched approach to life and disability assurance makes it well suited to do so.
“With BrightRock’s needs-matched product structure, disability and income protection cover for a stay-at-home parent can be uniquely tailored in terms of cover amounts, premium increases and pay-out structure to meet the family’s household, childcare, healthcare and debt needs. Unique features include the ability to choose between a lump sum and a recurring income at the point of claim, when the family better understands the stay-at-home parent’s prognosis and their financial needs. Families can also buy additional cover or change cover when their needs change, without medical underwriting.
“BrightRock will calculate the stay-at-home parent’s ‘income’ at a maximum of half of the working spouse’s income, and maximum rand limits apply. Income-earning clients who choose to become stay-at-home parents, take time off work or take extended maternity leave will keep all their BrightRock cover in force at their existing cover amounts for up to 12 months. In both of these scenarios, clients will continue to have access to the additional features of our product offering, which enables them to change their cover as their needs change.
“We believe it is worth protecting income for stay-at-home parents, given the role they play in families’ financial well-being,” Malan says.
This article first appeared on Saturday, 1 July 2017 in the Personal Finance section of Independent Newspapers (The Weekend Argus, Pretoria News Weekend, Saturday Star and the Independent on Saturday), as well as IOL.co.za. Click here to read the original version.
31 March 2017, Johannesburg – BrightRock, life insurance industry game changer, has partnered with the Johannesburg International Comedy Festival (JICF) as the official web- and live-streaming partner of this year’s festival.
To provide an opportunity for a wider audience to be a part of the festival – and for those who weren’t able to get tickets – BrightRock is setting up the #LoveChange Studio at the Orbit Jazz Club and Bistro in Braamfontein, where Jason Goliath will be interviewing local and international comedians about the Big Change Moments in their lives. It will be live-streamed on Facebook Live.
Official acts at the festival include Nina Hastie, Tats Nkonzo, Joey Rasdien, Tips Shampoonaiza, Celeste Ntuli and international comedians like Igor Meerson from Russia, Basketmouth from Nigeria, Eddy King from Canada, Sofie Hagen from Denmark and Imran Yusuf from Kenya.
“We’re pleased to have comedian Jason Goliath in our #LoveChange Studio bringing social media audiences a unique, live JIFC experience. He will be most ably accompanied by Glen Biderman-Pam manning a roving camera to share behind-the-scenes footage of the backstage shenanigans and the vibe on the streets of Braamfontein ,” adds Suzanne Stevens, Executive Director of Marketing at BrightRock.
Online viewers will be able to enjoy every single minute of the in-studio and behind-the-scenes action as it is live-streamed on the BrightRock- and Johannesburg International Comedy Festival Facebook pages, available at https://www.facebook.com/BrightRockZA/ and https://www.facebook.com/JICF.SA/.
Jason Goliath will be hosting two sessions per evening at the studio, starting on Friday 31 March 2017 at around 18:00. Each session will last about 60 minutes, and if you happen to miss anything you wanted to see from the #LoveChange Studio, you will be able to watch recordings of the sessions on the BrightRock Facebook page, BrightRock TV on YouTube and the Change Exchange at www.changeexchange.co.za.
Says Stevens: “At BrightRock we say we #LoveChange, because it is in the willingness to welcome change that we are able to find the opportunities it presents. And especially when it relates to those big moments of change that we all go through in life – landing that job, starting a family, tying the knot and buying a home. Since we at BrightRock love talking about Loving Change, we also create conversation platforms for it. It’s platforms like this one – our new #LoveChange Studio – that enable us to explore and share our experiences of Loving Change, from the serious to the light-hearted and downright fun.”
Takunda Bimha, founding director of the Johannesburg International Comedy Festival, says they believe the #LoveChange Studio will give comedy fans and audiences an opportunity to experience the festival in a completely different way.
“We are incredibly excited about this initiative. Given the amazing work that BrightRock has been doing with comedy content, we look forward to building a relationship with the brand for a long time to come.”
* Watch the first webisode from the festival below:
For Schalk Malan, CEO of BrightRock, a lesson learned as a hesitant competitive swimmer has served him well for life, and a career built on loving change.
Schalk Malan was in his matric year in the little town of White River in Mpumalanga, when he made the big decision that would forever change his life. It was sink or swim. He chose swim.
A talented rugby player, he had already decided, much to the shock and amazement of his family, that he was going to forgo the team sport in favour of his solo speciality. Then, one night, at a small gala, he wasn’t so sure anymore.
“I didn’t want to swim this one race,” he recalls, “and my mom got quite annoyed. She said to me that if I don’t swim this race, she will never come to a gala again. It sounds like a hard line, but she did it out of love.”
So Schalk took a deep breath, and put one foot on the starting block, then the other. At the sound of the pistol, he dived in. “All said and done, I actually ended up winning,” he shrugs.
More than that, he went on to become the South African Schools Swimming Champion, and the lesson he learned guides him even today. Listen to your mother. That, and take the plunge.
You can’t win the races you don’t race, and that applies equally in the world of business as it does in school sport. As a co-founder and now CEO of BrightRock, Schalk has learned how to silence that little voice of doubt that once made him hesitate on the sidelines. The secret is: focus.
“You can’t worry about other problems that might come up later on. You just need to focus on what you can control right now,” he says. “I think swimming taught me a little about that discipline. You can only focus on your goals, and stay inside your lane.”
But what if things don’t go according to plan? They seldom do, says Schalk.
“What I’ve learned is that your preparation is actually there to prepare you for how to handle things when they don’t go according to plan.”
He remembers his first day of work at a big insurance company, where he had been hired on the strength of his academic record as an Actuarial Science graduate.
“I’d always worked hard to keep my marks quite high and compete well in my class,” he explains.
Still, he discovered very quickly that your marks count for little when you are presented with a daunting challenge in the real world.
Asked to build a model for a new insurance product, he wandered “cap-in-hand” to a more experienced colleague: “All your bravado falls away. You have to walk to this guy and say, I need help here. Help me? Guide me? You realise quickly that you can’t do it on your own. Getting 80% might be possible and academically sufficient, but in the workplace you realise that 80 percent sometimes might not be good enough. And you then need people to protect you and support you.”
Just shy of six years ago, when Schalk joined the small team who founded BrightRock, on the premise of its Needs-Matched philosophy – your insurance changes as your life changes – he found the right people.
Surround yourself with brilliant people who are smarter than you, and more diverse in their thinking, says Schalk, and you will succeed. But it helps too, if you are able to dive in at the deep end, swim for your life, and prove that you’ve got what it takes to Love Change.
As small and medium enterprises continues to grow and boost the economy, business assurance for entrepreneurs is becoming more and vital. Are you adequately covered for changing needs and times?
Small business is big business. From the hardware shop on the corner to the mobile food stand at the market, from the work-at-home web designer to the out-and-about dog groomer, SMEs (Small and Medium Enterprises) contribute more than 36 percent to the Gross Domestic Product of South Africa.
That’s a lot of enterprise, a lot of sweat and toil, and a lot of prospect for creating jobs and wealth and boosting the economy. But it also means a lot of stress and planning for the small to medium entrepreneur, who must learn to balance risk and reward as the business grows.
A big part of that planning is contingency: what if something goes wrong? What if something happens to you or your business partner? That’s where business assurance comes in, as part of the quest to create an “enabling environment” for SMEs to thrive, says Leopold Malan, Executive Director of BrightRock.
“Being able to afford the right cover is a stumbling block for many business owners,” says Leopold, “because traditional business assurance policies are structured the same as personal life insurance policies.”
In contrast, based on its unique Needs-Matched philosophy, BrightRock offers business owners flexible cover that matches their needs, with premiums that are up to 40 per cent cheaper.
Leopold uses the example of a small or medium business with a one-million-Rand loan from the bank.
“You might want to pay that off over 10 years, so you don’t want to be buying long-term cover for whole of life. You would be paying a much bigger premium than if you were taking appropriate cover just for 10 years.”
That’s why it’s crucial to look for a product that is relevant to your business needs, and flexible enough to cope with the most powerful and dynamic force in nature and in life: change.
“The entrepreneur is the most important asset in the business,” says Leopold. “Without the entrepreneur, the business won’t run. It’s important that you start your insurance by making sure you’ve got that individual covered.”
This applies equally to what is known as key-man insurance, which provides cover for the loss of a business partner, and to contingent liability insurance, which covers you for payment of a bank loan.
”Let’s say you start a small law-firm,” says Leopold. “People often forget that the professional fees you’re earning pays not just your salary, but also the overheads of the office. Being able to insure not your income, but the revenue you create for the services you deliver is very important. Because when something happens to you, all of that revenue dries up and then none of those bills can be paid.”
Work hard, dream big, plan ahead. That’s the formula for making it in business, whatever line of business you’re in. And if you include flexible, relevant cover for your business as part of your planning, you’re assured of the brightest possible future.
Hello, and a very warm and bright welcome to this edition of The Comet, bringing you news, views, advice and insights from the world of BrightRock and beyond.
And it’s a world that is swiftly growing and changing, as we shine the spotlight on a landmark deal between five-year-old BrightRock and 99-year-old Sanlam.
Read all about it in our interview with BrightRock CEO Schalk Malan, who tells Alec Hogg: “You’ve got to want to change the world. You need to have a very specific objective that you want to achieve.”
So here’s to you and your big dreams too. Remember, it all begins with a single bright idea…and a lot of hard work to make it happen.
We hope you enjoy this edition, and please feel free to join us on our social media channels, Twitter at @BrightRockZA, Facebook on www.facebook.com/BrightRockZA, and at our bright and breezy online portal, http://changeexchange.brightrock.co.za.
Only five years after its founding, the company that brought Love Change to life embarks on a bold new era, with the announcement of a major deal with Sanlam
Some companies started in a garage: Apple, Google, Amazon. Some started in a bedroom: Facebook. Some started in a basement: Virgin Records.
But when Sean Hanlon, Suzanne Stevens, Schalk Malan and Leopold Malan got together to start their fledgling life insurance company in 2011, it was around a dining-room table in suburban Johannesburg.
Between hearty snacks and copious cups of coffee, they set out to build a business on the basis of a bright idea: a life insurance product that changes as your life changes, to match your needs as a dynamic, ever-evolving individual.
Today, just over five years later, that idea has grown into BrightRock, an industry disruptor that has created almost R1.5-billion in value, with R148-billion worth of life cover in force.
And now comes a bold new chapter in the story of BrightRock, with the announcement that the listed financial services group, Sanlam, will acquire a 53% stake in the company, subject to regulatory approval.
Under the agreement, Sanlam and BrightRock will continue to function as independent businesses, retaining their own brands, life insurance licences and management teams.
“BrightRock is proud to welcome Sanlam as our new majority shareholder,” says BrightRock CEO Schalk Malan. “In Sanlam, we have found a true growth partner with exceptional credentials that is supportive of our aspirations to create a highly differentiated and autonomous financial services business of scale. We’re also pleased that the Lombard Insurance Group, our founding investors that backed BrightRock from inception, will remain shareholders in our business going forward.”
Sanlam Personal Finance (SPF) Deputy CEO Hennie de Villiers, says the acquisition of BrightRock is in line with Sanlam’s strategy to seek profitable and sustainable growth opportunities, and is testimony to Sanlam’s commitment to invest in South Africa.
“We believe BrightRock has established a strong and credible presence in the South African market and presents a valuable proposition to people’s insurance needs”, says De Villiers.
“In particular, the company’s innovative needs-matched life insurance offering supports Sanlam’s client-focused philosophy and our strong belief in the value of financial advice by qualified and accredited intermediaries. We believe that the BrightRock offering, together with our Matrix offering to which we introduced significant innovations early in 2016, puts us in an excellent position to meet client needs and further grow our market share.”
While BrightRock products are currently sold solely through independent brokers, the product range will in future also be available through Sanlam Financial Advisers. Sanlam Broker Distribution will also take the product to market alongside its Matrix offering.
Sanlam and BrightRock will inform the market and interested parties of progress regarding the transaction. For now, please read Alec Hogg’s interview with Schalk Malan in this edition of The Comet, for more on what this landmark deal means for BrightRock and you.
Business Day TV’s Alishia Seckam interviewed BrightRock’s Schalk Malan and Sanlam’s Hennie te Villiers about Sanlam’s intention to acquire a majority stake in BrightRock:
This interview was originally broadcast on Seckam’s Taking Stock-programme on 26 January 2017.
On Wednesday, 25 January, BrightRock and Sanlam announced that Sanlam is set to acquire a 53% stake in needs-matched life insurance provider, BrightRock, subject to regulatory approval.
Don’t miss portfolio manager Gary van Onselin’s take on this entrepreneurial miletone on CNBC:
You can also read the full announcement by BrightRock and Sanlam here.
Sanlam het ’n meerderheidsbelang van 53% in die lewensversekeringsmaatskappy BrightRock gekoop vir ’n bedrag van tot R707 miljoen.
Die finansiëledienstegroep het Woensdagmiddag op die JSE se Sens-nuusdiens aangekondig die transaksie is nog aan regulatoriese goedkeuring onderhewig.
Hennie de Villiers, adjunkhoof van Sanlam Persoonlike Finansies, sê noulettendheidsprosesse is reeds afgehandel. Die transaksiebedrag sal afhang van presies wanneer dit finaal goedgekeur kan word, maar dit sal nie meer as R707 miljoen wees nie, mits die transaksie in die eerste helfte van die jaar beklink word.
Sanlam sal dit uit sy beskikbare kapitaalbronne finansier.
Volgens De Villiers is die verkryging deel van Sanlam se strategie om winsgewende en volhoubare groeigeleenthede te soek, en dit beklemtoon ook die groep se verbintenis om steeds in Suid-Afrika te belê.
Sanlam het die afgelope jaar of wat groot transaksies buite die land gedoen, soos die koop van die belang in Saham Finances wat in die res van Afrika sake doen, asook sy beleggings in die Indiese finansiëledienstebedryf. Sanlam het in Desember sy belang in Saham Finances van 30% tot 46,6% opgestoot.
Volgens De Villiers het BrightRock ’n sterk teenwoordigheid in die plaaslike mark opgebou. Die onderneming sal voortgaan as ’n onafhanklike onderneming met sy eie bestuurspan, handelsnaam en lewensversekeringslisensie.
Schalk Malan, hoof van BrightRock, sê sy onderneming het sterk gegroei sedert dit in 2011 begin is, en dit bied nou dekking van R148 miljard en kry jaarlikse premie-inkomste van meer as R611 miljoen. Die Lombard Insurance Group wat die aanvangsbeleggers in BrightRock was, bly aan as aandeelhouers, maar Malan is nie in ‘n posisie om te sê wat Lombard se belang in die onderneming voor en na die transaksie is en sal wees nie.
BrightRock se produkte is tot dusver slegs deur onafhanklike makelaars verkoop, maar sal voortaan ook via Sanlam se finansiële adviseurs en makelaars beskikbaar wees.
Sanlam se aandeelprys was Woensdagaand 0,43% hoër op R66,03. - Francois Williams
Hierdie berig is oorspronklik op Netwerk24 en in Die Burger gepubliseer. Lees die oorspronklike berig hier.
We are proud and delighted to share breaking news that’s set to position us for exponential future growth.
Today (25 January 2017), BrightRock and Sanlam have announced that Sanlam, subject to regulatory approval, will acquire a 53% stake in BrightRock for R707 million.
This is a milestone in BrightRock’s entrepreneurial journey and an important step towards realising our vision of building a fully-fledged, competitive life business.
After five years in business, this announcement cements – and reinforces – BrightRock’s reputation as one of the fastest-growing life insurance players in our sector. Importantly, Sanlam and BrightRock will continue to function as separate businesses, each of them retaining their own brand, life insurance licence and management team.
Read the full press release here.
The 1st of December 2016 marked the 28th time that the world observed World AIDS Day. While South Africa has the highest prevalence of HIV/AIDS in the world, with over six million people living with the disease in the country, the country has come a long way towards treating people living with HIV.
Better access to antiretroviral (ART) treatment and more medical information about treating HIV have enabled those living with the condition to live longer and have a better standard of life. in a bid to increase their offering, BrightRock recently announced that it will now be offering needs-matched insurance solutions for people living with HIV.
While there are some medical insurance companies that focus specifically on providing life insurance cover to HIV positive people, traditional insurers haven’t had products for HIV positive people until recently. BrightRock is committed to giving cover to as many South Africans as possible and are pleased to be able to extend needs-matched product to people living with HIV.
HIV positive people who have been on treatment for at least six months, have a viral load of less than 400, a CD4 count of more than 200 and aren’t suffering from any AIDS defining condition, like tuberculosis (TB), will be able to access this cover. This will hopefully be the first step in more and more insurers offering cover for people living with HIV.
The company is encouraged by the developments they have seen in the past few years in the prevention and treatment of HIV/AIDS. People living with HIV can now live relatively healthy lives and this condition is now seen more as a chronic condition that can be managed easily.
While finding a cure for HIV/AIDS still seems like a distant dream, there’s progress being made towards finding a vaccine. The International AIDS Conference (AIDS 2016), which was held in Durban in July this year once again brought sharp focus on where we’re going towards treating HIV in the future.
Deputy Director of the Desmond Tutu HIV Centre in Cape Town, Linda-Gail Bekker, announced at the conference that 5 400 HIV-negative people across South Africa would be testing a new HIV vaccine called HVTN 702. This vaccine, which will be trialled on people between the ages of 18 – 35, is specifically designed for South Africa and will run for three years. Participants will receive five injections over the course of a year and will be followed-up for two years more to establish whether the vaccine has a sustained protective effect. If the vaccine is successful, it will be the first preventative vaccine in the world.
This is good news for the country and the world as the rate of new HIV infections is still alarmingly high – 2.1 million people were infected with HIV last year alone. Even so, the amount of research being done all over the world to try and end HIV is encouraging and hopefully the world will achieve the United Nations goal of ending the AIDS epidemic by 2030. Until then, BrightRock will continue to try and find solutions to help HIV-positive people protect their families financially should they be permanently disabled or die.
This article was originally published online by Risk Africa Magazine. Click here to view the original.
Meet Jeanine Horn-Erasmus, a BrightRock team leader who has discovered the true secret of motivating a team. Bake them a delicious cake if they keep up the good work.
What does it take to run a happy office, where everyone gets along, gets the job done, and shares the workload when the pressure is on?
For Jeanine Horn-Erasmus, a Team Leader of Policy Finance at BrightRock, the answer is simple. It takes chocolate cake.
Not just any chocolate cake, but her own home-baked variety. “It’s nice and moist,” she says, “and I add coffee and caramel and cream to the recipe to make it extra special.”
Jeanine brings in her signature treat on special occasions, such as birthdays, baby showers, and, well, Fridays. “I always say to my team, if I hear no complaints from you this week, I’ll bake a chocolate cake.”
She hears very few complaints. “Working at BrightRock is like being part of a family,” says Jeanine, who divides her time between the Port Elizabeth and Durban offices. “We spend most of the day together and get to know each other quite well. We celebrate each other’s achievements and can count on each other.”
Born in Pretoria, Jeanine grew up in PE, a city she loves for its affordability, its work-life balance, and its leisure opportunities, from “Sunday Funday” on the beach to game drives in the Addo Elephant Park.
Outdoor photography is Jeanine’s other big interest, but her abiding passion in life has always been numbers. Her friends call her the Minister of Finance, because she is the one who loves maths and accounting, and she is the one who works out who owes what when the bill comes around.
Now she is the one who loves working with numbers at BrightRock, because numbers aren’t numbers – they’re people.
“The thing that sets us apart is needs-matched insurance that changes as the client’s needs change,” says Jeanine. The same applies to the job itself.
“Policy Finance is a very fast paced environment, constantly changing with the need to tweak processes as we learn from past experiences. You need to be open to change and be innovative and think of more efficient ways of doing the daily tasks in your area.”
Looking back on the year, her first at BrightRock, Jeanine pauses for breath as she counts off the change moments. A new job, a move to a new house in a new city, a big promotion for her husband, Jacques, who works in food management for Woolworths, a big decision to commute between Durban and PE to enjoy the best of both worlds.
“It’s been very exciting,” says Jeanine. “I can’t wait to see what change moments 2017 has in store for me.”
One thing is for sure. It’ll involve chocolate cake.
As the world observes AIDS Awareness Month, BrightRock now offers solutions for people living with HIV
It’s holiday time. A much-needed opportunity to rest, relax, recharge and unwind after a hectic year of change. But December is also a month of reflection and remembrance, as the spotlight shines on the fight against HIV/AIDS.
This year marks the 28th annual observation of World AIDS Day and AIDS Awareness Month, which has special significance in South Africa.
Here, more than 6-million people, or just under 12 per cent of the population, are living with HIV, one of the highest rates of infection in the world.
The good news, according to a 2015 report by Statistics SA, is that life expectancy for HIV-positive South Africans is increasing, thanks to improved access to medication and treatment.
While finding a cure for HIV/AIDS still seems a distant dream, there is progress being made towards finding a vaccine.
At the The International AIDS Conference in Durban this year, Linda-Gail Bekker, Deputy Director of the Desmond Tutu HIV Centre in Cape Town, announced 5 400 HIV-negative people across South Africa would be testing a new HIV vaccine called HVTN 702.
This vaccine, which will be trialled on people aged between 18 to 35, is designed for South Africa, and the project will run for three years. If the vaccine is successful, it will be the first preventative vaccine in the world.
HIV is now widely regarded as a manageable chronic condition, and people living with HIV now have greater access to life insurance too.
While some companies focus specifically on providing life insurance cover to HIV positive people, traditional insurers only recently started to accommodate HIV positive clients in their product offerings.
At BrightRock, we’re pleased to be able to offer solutions for people living with HIV, provided they have been treatment-compliant for a period of time and continue to comply.
We support World AIDS Awareness Month, in the hope that greater knowledge and scientific breakthroughs will one day lead to the end of an epidemic that has cost so many lives and affected so many people.
*Please speak to your financial adviser for more information on BrightRock’s solutions for people living with HIV.
In a mere five years, BrightRock has managed to carve out a strong position for itself in the fiercely competitive insurance industry. How has the company so successfully taken on powerful and entrenched competitors? By GG van Rooyen
The South African insurance sector didn’t perform particularly well during the 2015/2016 financial year. In fact, the industry posted below-inflation growth of around 4.5%. Compare this to the year-on-year growth that BrightRock enjoyed over the same period – a staggering 72% – and you realise that the founders of the company have accomplished something very impressive. BrightRock has established itself in an industry that is capital intensive and dominated by entrenched players. How have the four company founders managed this?
Changing the game
Sectors such as financial services and insurance can seem impossible to upend, expecially when you take a moment to consider the obstacles. There are powerful players who have been playing the game for a long time, and you are dealing with potential clients who often don’t even really understand what they’re buying into. Products can be complex, so educating people on how your offering is different isn’t always easy.
“It’s often said that the insurance industry is quite innovative, but when you really look at it, you realise that policies have been looking pretty much the same for a long time now,” says BrightRock co-founder and executive director of distribution Sean Hanlon. “All four of us had been in the industry for a long time, and we realised that things could be done very differently. There was a market for a different kind of policy.”
Leopold Malan, executive director of processing adds: “When we started BrightRock, we wanted to bring about change in the industry by providing cover that is both relevant and appropriate to each and every individual client, and continues to match the needs of clients as their lives change. Four years after our market entry, we are pleased to see the subtantial take-up of our need-matched product offering. The flexible design in our cover also allows for us to provide up to 48% more cover for the same premium, allowing greater affordability initially and over the long term.
“In our first year, 47% to 53% of our policyholders wanted traditional, lump-sum cover. However, an overwhelming 71% of our policyholders now opt for needs-matched insurance through product options that allow them to shift their cover as their needs change.”
BrightRock entered into a saturated market, but it approached the industry in a unique way. In a sense, it created its own playing field.
This is a good example of how a traditional industry can be disrupted. Moreover, it shows that disruption need not necessarily be driven by technology. Disruption can be created just by tweaking exisitng offerings. A new company like BrightRock doesn’t have a massive legacy and loads of exisiting clients that so often lock a large business into its existing model. The important thing, though, is to take advantage of this freedom – to not simply fall into existing patterns of doing business. Starting a new company offers a unique opportunity to reassess the way in which things are done, and to change it.
Educating the client
Whenever you offer a completely new way of doing things, prospective clients need to be educated and shown why “new” is in fact also “better”.
As mentioned, it took a while for BrightRock clients to adjust to the company’s new offering. So how did BrightRock manage to change clients’ minds?
Well, the company was savvy in the way in which it marketed itself. Right from the start, it realised the need to create clever marketing content that explained its offering.
“Bringing a new brand with a new way of doing things to the market isn’t easy,” says Suzanne Stevens, executive director of marketing. “Educating the consumer is a tough task, and we knew that we couldn’t outspend our competition. To address the issue, we designed a marketing model that started with a content-based approach on platforms we could own. For example, we built a green-screen studio in-house and partnered with journalist Ruda Landman to create videos that explored the change moments in people’s lives. This was a good way to look at insurance in a personal way – to make the implications of insurance real, and to show how life changes dictated insurance needs.”
The campaign was so successful, that BrightRock eventually sold the idea to kykNET as a show called VeranderDinge.
BrightRock also made the decision to try to do away with much of the jargon and complexity often associated with insurance policies.
“We made sure that all materials were simple and easy to understand,” says Stevens. “We also endeavoured to make the claims process as hassle-free as possible and to allow a client to speak to a human being whenever they wanted. In the end, it all came down to empowering the client to have a meaningful conversation – to understand our offering and ask pertinent questions.”
When it came to selling its policies, BrightRock decided to go with independent brokers who sold various policies.
“We wanted our offering to prove itself,” says Schalk Malan, actuarial executive director. “We wanted experts in the industry to be able to compare our offering with those of others, and let it speak for itself. We were confident that we had a product that could stand on its own and benefit from comparison.”
Key to the success of BrightRock has been its ability to scale successfully. It is something many companies struggle with, since quick growth leads to increased complexity. Managing this complexity is key.
“There are great advantages to being a new-start-up,” says Hanlon. “When you’re small, you can react quickly. As you grow, though, this becomes harder. With this in mind, we made the decision to put systems in place early on. And having spent time on it from the beginning, we were able to grow quickly.”
“We focused on creating a simple platform that was accessible enough to be used both internally and externally. It was all about stripping out unnecessary complexity, since this would slow down the on-boarding process, both in terms of new clients and new employees,” says Stevens.
Leopold Malan is quick to add, however, that systems and processes can only take a start-up so far. “It takes a good five to ten years to thoroughly implement the systems and processes needed. It is not a simple task. This means that, during the first few years of doing business, your systems will let you down. And when this happens, you need good people in place who can take up the slack.”
BrightRock’s founders have been careful to place the A-players and experienced managers needed to manage growth.
“When it comes to scaling, you’ll often find that it’s the human capital element that limits growth. You can grow your client base quickly, but you need good people who can actually manage the workload. Getting new clients is great, but you need to be able to retain them,” says Hanlon.
This article was originally published in the November 2016 edition of Entrepreneur magazine.
Johannesburg, October, 2016 – Fast-growing life insurance player BrightRock has again renewed its commitment to financial advice with the introduction of a range of industry-leading product enhancements and features that enable the best risk cover advice and support the intent of the Retail Distribution Review (RDR).
During a recent series of nationwide update sessions for financial advisers, executive director Schalk Malan announced that BrightRock’s cover in force has grown to just shy of R139 billion in October (an increase of close to R16 billion in a mere three months since they celebrated their fourth year in the market with R123 billion cover in force).
Malan ascribes their status as the fastest growing company in their category to their needs-matched product, which he believes aligns with the best advice financial advisers can give to their clients.
“Despite financial advisers’ best efforts, traditional risk products are often inefficient, inflexible and inappropriate to the client’s underlying need,” explains Malan. “Many of these problems are not only at odds with financial advisers’ advice, but also with RDR requirements. BrightRock’s needs-matched insurance provides a product that enables, strengthens and aligns with the best advice throughout client’s various life stages, as envisioned by the RDR.”
BrightRock continues to build on its strong, differentiated product platform with several new product enhancements and features, which now includes needs-matched cover for clients who would previously have been declined any cover. This includes cover for HIV-positive clients who have been on antiretroviral treatment for six months or more and are not suffering from any AIDS defining conditions like tuberculosis or hepatitis.
In addition to providing cover for HIV-positive clients, BrightRock also introduced a new hospital costs pay-out feature, which pays out an additional amount if the client dies after a long hospital stay. This payout is over and above BrightRock’s standard R50 000 pay-out after a client dies, meaning clients will effectively have their immediate expenses pay-out doubled.
By widening their underwriting bands, BrightRock was also able to introduce further enhancements and improvements to their extra cover buy-up product feature, which allows clients to buy additional cover if their needs have changed to a maximum of R10 million. This feature was previously limited to R7.5 million. Similarly, the cover conversion facility has been enhanced with a R2.5 million increase in the maximum amount of cover clients can access to R10 million.
On the technological front, BrightRock introduced improvements to their Flint quoting tool with many new features built into it to make advisers’ lives easier. Flint promises to be more responsive thanks to a 75% reduction in application size, which results in a 68% improvement in initial start-up times, 64% improvement in cover proposal load times and 85% improvement in initial cover proposal search times.
“The enhancements to our online platform and the technology behind it offers us an exciting opportunity to develop and roll out some of our future plans faster and better,” says Malan. “These plans include the introduction of a host of self-servicing options that will further enable the best advice.”
Malan says their Advanced Underwriting product feature, which they introduced in August this year, has been a great success. This new underwriting method gives qualifying clients the ability to apply for cover of up to R10 million without a standard nurse visit for an HIV test. One of this feature’s success stories was an instance where a client received cover in less than 4 business hours through an entirely electronic application and underwriting process, without seeing a nurse.
BrightRock was started with the goal of creating insurance products that truly meets consumers’ and financial advisers’ needs. It offers individualised, needs-matched life insurance cover that’s built around your specific needs at the outset, and is specially designed to change with you as your needs change. And because BrightRock’s cover is flexible and changes appropriately when your needs change, it’s more efficient. This means both your cover and your premiums remain relevant, and more affordable, throughout your life. BrightRock (Pty) Ltd, underwritten by Lombard Life Ltd, is an authorised financial services provider.
Jennifer Leppington-Clark (Hill + Knowlton Strategies)
011 463 2198
Marthinus Jansen van Vuuren (BrightRock)
010 003 2108
As the fastest-growing company in its category, BrightRock has introduced a range of new features and enhancements to make life even better and smarter for you
Life, goes the saying, attributed to the writer Allen Saunders and made famous in a song by John Lennon, is what happens while we’re busy making other plans. That’s why it’s so important to make plans for life, because life is always subject to change.
Five years ago, on the cornerstone of this simple premise, BrightRock began building a company that has changed the way life insurance works. By adapting to your needs, as you make your way along the milestones of life, it works uniquely for you.
BrightRock’s individualised, needs-matched insurance cover has made it the fastest-growing company in its category, with cover in force reaching close to R139-billion in October this year.
And with growth, comes even more opportunity to change, refine, and enhance BrightRock’s product offerings, as executive director Schalk Malan told financial advisers in a series of update sessions across the country.
“Despite financial advisers’ best efforts, traditional risk products are often inefficient, inflexible and inappropriate to the client’s underlying need,” says Schalk.
“BrightRock’s needs-matched insurance provides a product that enables, strengthens and aligns with the best advice throughout the client’s various life stages.”
BrightRock continues to build on its strong, differentiated product platform, with several new product enhancements and features. Needs-matched cover is now available for clients who would previously have been declined any cover.
This includes cover for HIV-positive clients who have been on antiretroviral treatment for six months or more and are not suffering from any AIDS defining conditions, such as tuberculosis or hepatitis.
As well as providing cover for HIV-positive clients, BrightRock has introduced a new hospital costs pay-out feature, which pays out an additional amount if the client dies after a long hospital stay.
This payout is over and above BrightRock’s standard R50 000 pay-out after a client dies, meaning clients will effectively have their immediate expenses pay-out doubled.
By widening their underwriting bands, BrightRock was also able to introduce further enhancements and improvements to their extra cover buy-up product feature, which allows clients to buy additional cover if their needs have changed, to a maximum of R10 million. This feature was previously limited to R7.5 million.
Similarly, the cover conversion facility has been enhanced with a R2.5 million increase, raising the maximum amount of cover clients can access to R10 million.
BrightRock prides itself on the sophisticated technology that drives and complements its products, and here too, new features have been introduced to make life easier for financial advisers and clients alike.
“The enhancements to our online platform and the technology behind it offer us an exciting opportunity to develop and roll out some of our future plans faster and better,” says Schalk. “These plans include the introduction of a host of self-servicing options that will further enable the best advice.”
BrightRock’s Advanced Underwriting product feature, introduced in August this year, has also been a great success, says Schalk. This new underwriting method allows qualifying clients to apply for cover of up to R10 million without a standard nurse visit for an HIV test.
In one instance, a client in Dubai received cover in less than 13 business hours, through an entirely electronic application and underwriting process.
Also newly updated is BrightRock’s Trauma IQ product feature, which looks at the impact a medical event has had on a client, as a basis for a pay-out.
Recently, a 5% pay-out of R25 000 was made to a client whose hand was badly bitten by a monkey at a wildlife sanctuary. No other provider in the market would have paid the client’s claim, says Schalk.
More proof that it pays to be ready for anything in life, by making plans that will help you and your family when life changes.
Johannesburg. July, 2016 – Provider of needs-matched life insurance, BrightRock is proud to announce their partnership with the Chris Burger Petro Jackson Players’ Fund to host the Play the Bounce Players’ Fund Banquet.
This prestigious annual event will be taking place on 27 September 2016 and will be attended by the entire Springbok team, each of whom will be hosting a table at the banquet. All the funds raised from this event will be in aid of the Players’ Fund, which was started in 1980 to support South African rugby players who sustain disabling and life-changing head, neck or spinal cord injuries while participating in the game.
To date, the Fund has helped no fewer than 400 seriously injured players and their families by providing support and mobility equipment, vital in the transition to living life under very different circumstances. The Fund is also involved in efforts to make rugby safer and to prevent similar injuries from happening. BokSmart, the National Rugby Safety programme, is a joint initiative between the South African Rugby Union and the Players’ Fund which provides rugby coaches, referees, players and administrators with the correct knowledge, skills and protocols to ensure that safety and best practice principles are incorporated into all aspects of rugby in South Africa.
According to Players’ Fund chairman Morné du Plessis, having the enthusiastic and dynamic brand of BrightRock behind this event will take it to new heights.
“This partnership will increase the Fund’s ability to play the role of Rugby’s Caring Hands in the lives of those who would otherwise have been left on the side lines” says Du Plessis.
BrightRock executive director Suzanne Stevens, believes the sponsorship of the Players’ Fund is an extension on of BrightRock’s Play the Bounce philosophy, which positively embraces the ever-changing, unpredictable nature of life and of rugby.
“The Players’ Fund’s motivation and its recipients demonstrate that even when the ball bounces in unexpected ways (both on the field and in life), that change like this can still be navigated with surprising and life affirming results – most especially when peoples unique needs are met properly.”
BrightRock’s involvement in the Play the Bounce Banquet follows the announcement of their three-year associate-sponsorship of the DHL Stormers and DHL Western Province, which kicked off in January this year. The company launched its unique needs-matched life insurance offering in 2012 and is rapidly establishing itself as one of the fastest-growing players in the intermediated individual life market in South Africa.
Stevens explains that the concept of change is central to the BrightRock’s needs-matched insurance offering, which is uniquely able to change with clients as their needs change over their lifetime. “Rugby, like life, is a game where the unpredictable is always a play away and can challenge even the best skill and preparation.”
“We hope and trust that our involvement in the Play The Bounce Players’ Fund Banquet will further enhance the positive difference the Player’s Fund makes in South African rugby.”
About the BrightRock Play the Bounce Players’ Fund Banquet
The BrightRock Play the Bounce Players’ Fund Banquet takes place on the evening of 27 September 2016 in the Montecasino Ballroom in Fourways, Johannesburg. It is in support of the Chris Burger Petro Jackson Players’ Fund.
The current Springboks squad will be honorary guests at the event, with every table hosted by a player, providing guests with an opportunity to interact with their favourite players. Tables can be booked at a cost of R16 000 per table (seating 9 guests). All the funds generated from the Play the Bounce Players’ Fund Banquet will be in aid of the Chris Burger and Petro Jackson Players’ Fund.
The Dan Nicholl Show will also be filming the event and conducting interviews with some of the guests, and highlights will be broadcasted on Supersport the following evening.
Visit the Players’ Fund Website for more information, or call 021 659 5615.
BrightRock was started with the goal of creating insurance products that truly meets consumers’ and financial advisers’ needs. It offers individualised, needs-matched life insurance cover that’s built around your specific needs at the outset, and is specially designed to change with you as your needs change. And because BrightRock’s cover is flexible and changes appropriately when your needs change, it’s more efficient. This means both your cover and your premiums remain relevant, and more affordable, throughout your life. BrightRock (Pty) Ltd, underwritten by Lombard Life Ltd, is an authorised financial services provider.
Meet Lilly Govender, Processing Manager at BrightRock, whose love of bold, bright colours reflects her outlook on life
Now here’s a bright idea. Paint your walls green, and frame them with a swish of purple curtains. In the kitchen, try a splash of sunshine yellow, with red blinds to let the light in.
For Lilly Govender, Processing Manager at BrightRock, these are the colours of home. “It’s a happy place,” she says. “It makes people feel warm.”
As vibrant and upbeat as her interior decor, Lilly has always warmed to people. She grew up in Chatsworth, near Durban – “Little India, we called it” – and hoped to study nursing after school.
Instead, she took a diploma in marketing management, gaining hands-on experience as a promotions assistant at a hypermarket in the Pavilion shopping centre.
Her first full-time job was in customer service for a medical aid company, not quite nursing, but it certainly called for patience and a good ear.
“It taught me the importance of listening to people,” she says. “Even if they’re wrong. They just need to know that somebody has heard them.”
It was a skill that would prove even more vital when she moved into the field of life insurance, joining BrightRock, where her first role, she says with a chuckle, was “anything”. In practise, that meant a lot of processing and admin, specifically in the demanding arena of escalations.
“It’s a challenge. But when you get it right it’s like wow, we’ve done this, and it works. Every day I know I do help somebody, solving a case, or just getting back with an email.”
That same spirit of open communication is one of the reasons Lilly loves working at BrightRock: “Everyone in the company is listened to. Their ideas are heard. You really feel you’re a part of it.”
Away from the workspace, Lilly enjoys travelling, ideally to places that are the polar opposite of home. “I love seeing snow,” she says. “I like cold places.”
At the same time, she’s happy to admit, there’s no place like home, with its bold, bright mix of colours reflecting her attitude and outlook on life.
Protecting your income in case of illness or injury should be a vital part of your life planning, and BrightRock offers a unique solution to match your needs
So what do you do for a living? It’s one of the first questions we ask a new acquaintance, based on our natural interest in the passions, energies, and fields of endeavour that drive other people.
Of course, there’s a lot more to life than work, just as there’s a lot more to making a living than checking in and out of the office.
A good job will reward us, sustain us, and leave us feeling fulfilled: “Do what you love and love what you do,” as the mantra goes.
But what do you when misfortune strikes, and illness or injury prevents you from working and earning an income? With that prospect in mind, it’s important to ensure that your emergency plan includes comprehensive income protection cover.
But traditional insurance products don’t give you cover that really meets your needs when you claim. You may be uncertain when or if you’ll get a pay-out. And even if you do qualify for a pay-out, and as a result of this you might have your on-going pay-outs reduced or stopped even though you qualified initially, because companies may later reassess your disability and review your claim.
If you do manage to start earning some form of income again, some traditional insurance products might reduce their payment by the active income you are earning.
Traditional capital disability products often have waiting periods for up to 14 days, some even up to six months before paying out your cover. The purpose of these waiting periods is to see if you will survive this period. If you don’t, you will not receive your benefit, even though you would have received it in full had you passed away after the waiting period.
The other concern with some traditional product designs is that they can’t differentiate between the requirements of various needs, such as duration or future income growth requirements. They also fail to recognise that people could have different needs at claim stage.
For example, two people, both diagnosed with stage four cancer, could have totally different needs based on their financial requirements, prognosis and life expectancy at acclaims stage. Only BrightRock offers you the ability to either receive your future income payouts as a once-off lump sum or as a regular income. If your life expectancy is poor, the lump sum will offer you far more value. If you believe you will recover and have an unchanged life expectancy, then you can choose the certainty of a guaranteed income to retirement, growing every year.
As part of BrightRock’s unique Needs-Matched approach to life insurance, we’ve improved the way income your protection needs are covered.
Our product is designed to exactly match your permanent expenses needs. With BrightRock you get the following market-leading features that will ensure your cover is affordable and sustainable:
Claim-stage flexibility: only BrightRock offers you a best-of-both-worlds choice at claim-stage. You can change your initial choice of a lump-sum pay-out to a regular monthly pay-out at claim-stage.
Up to double the cover today: there’s no waste in a BrightRock policy, so every premium rand you spend with us works much harder for you, giving you an average 40% more cover today for the same premium rand.
No general survival period : with BrightRock you will not face a general survival period before qualifying for your capitalised permanent expenses pay-out
We don’t aggregate against active income earned: with BrightRock, you can claim 100% of your pre-claim earnings and your pay-outs won’t be reduced if you recover either.
Speak to your financial adviser for more information. And whatever you do for a living, make the most of it – for life!
Brought to you by BrightRock, the popular TV magazine show returns for a second season on KykNET
“Verander dinge”. In Afrikaans, it’s a call to action, meaning: change things. But it’s also a sly play on words, because vir ander dinge, which sounds exactly the same, means: for other things.
Put the two together, and you have the perfect name for a TV lifestyle magazine series that showcases a miscellany of lively, upbeat, and interesting items, while shining the spotlight on change.
Sponsored by BrightRock, as a platform for sharing the joys, challenges, and opportunities of change, and highlighting the positive role it can play in our lives, VeranderDinge is back on kykNET for an action-packed second season.
And the great news is a change in scheduling, to the prime-time slot of 6.30pm on Sundays.
With the dynamic duo of Ruda Landman and Kim Cloete at the helm, VeranderDinge puts the focus on in-depth, insightful interviews with prominent and influential South Africans, from Cape Town Mayor Patricia de Lille to songstress Sonja Herholdt, and from bubbly model and television presenter Minki van der Westhuizen to the astute political commentator, Max du Preez.
Then, of course, there are the ander dinge – the other things – a potpourri of information, inspiration, and entertainment, featuring profiles on extraordinary people (arm-wrestlers, cage-divers, brewmasters and more) and useful advice on everything from starting your own business to organising the best party ever for your children.
Either way, it’s all about change and loving it, so change the channel to kykNET and make the most of your Sunday with Ruda, Kim, and company.
“We are excited to once again place change under the magnifying glass with Ruda and Kim,” says Suzanne Stevens, executive director at BrightRock. “VeranderDinge matches up perfectly with BrightRock’s needs-matched approach to life cover, and it’s a privilege to enter a second season with this multi-faceted show.”
*Tune in to VeranderDinge at 6.30pm on Sundays on kykNET, channel 144 on dsTV.
Meet Francois Wirth, Enterprise Systems Architect at BrightRock, whose gift for programming and developing helps to build the software that builds the company
For his 15th birthday, from his grandmother, Francois Wirth received a present that would forever change his life. A computer.
It was a Pentium 486, the blazingly-fast super-desktop device of its day, and it wasn’t long before Francois was prising it apart with a screwdriver.
He wanted to get a good look at its inner workings, the chips and circuits and wires that gave it the power to process information and solve complex problems. And then, he wanted to learn its language.
He started programming in Pascal, supplementing knowledge gleaned from books with computer science classes at school. A computer, he soon realised, is something more than a machine.
“It’s a piece of clay in your hands,” he says. “It’s a creative outlet that can accommodate anything your imagination can stretch to.”
By the time he matriculated, in 1995, he was a smart enough coder to land a job at the forefront of one of the most momentous changes in the history of South African business.
The switchover from the raucous manual system of floor-trading in the “bullpen” of the Johannesburg Stock Exchange, to the fast and sleek automated electronic system, JET, or Johannesburg Equities Trading.
And today, after a stint in encryption technology and his own software consultancy, he’s found his niche at a high-tech company that loves change as much as he does. BrightRock.
Francois is an Enterprise Systems Architect, in charge of ensuring that the software systems on which BrightRock is built are powerful, flexible, and dynamic enough to meet the ever-changing needs of customers and brokers.
He likens his role to that of a city planner, who must make sure that the right buildings, fulfilling the right functions, are placed along the right streets. “For example, a hospital does one thing, and one thing only,” he says. “You wouldn’t book your car into a hospital, would you?”
Likewise, software systems are designed to perform specific functions, and work in tandem with other systems to form a cohesive, integrated whole – an electronic city that never sleeps. All of which puts great pressure on programmers and developers to come up with creative, hard-working solutions.
To an outsider, computer coding may appear to be a repetitive task, with a series of strict routines dictated by the mind of the machine. But as Francois explains: “If you do the same thing over and over, you look for better ways, until you reach a level of enlightenment. You need to have the inner drive to search for something new and creative. It’s no easy feat.”
That drive is the essence of change, reflecting the energy that drew Francois to BrightRock in the first place, and keeps him on his toes at the helm of an elite team he describes as “the Navy Seals”of BrightRock.
When he has time to unwind, Francois, a father of two, heads for the driving range, inspired by his 7-year-old son’s love of golf.
“I bought him a set of clubs as a present,” says Francois, “and then I thought, I may as well get myself a set as well.” After all, as Francois discovered, the right gift can change the way you see the world, and set you off on a path to a bright tomorrow.
It’s Autumn, that interlude between seasons, when nature takes a deep breath, and huffs and puffs the leaves from the trees.
It’s a time of golden hues and mellow reflection, a pause for thought before winter takes over the shift and tightens its icy grip.
For now, we bid you the warmest of welcomes to this edition of The Comet, your online guide to what’s new at BrightRock and beyond.
At BrightRock, we Love Change: the way it shapes our lives, ushers in the new, and creates opportunities.
So join us as we take a look at the way the Information Age is setting the pace for an exciting “Second Renaissance” of human ingenuity; as we explain how Your State of Mind affects Your State of Money; as we show you how to solve your online password problems for once and for all; and much more.
April 2016. – VeranderDinge, the popular lifestyle programme proudly sponsored by BrightRock, is back on your TV screens by popular demand in a new prime time slot. The first episode airs on Sunday, 10th April 2016 at 18:30.
Season 2 of VeranderDinge is still keeping to the theme of change and hosts Ruda Landman and Kim Cloete, will again be interviewing influential South Africans to unpack their change moments while inspiring viewers to accept and value change in their lives.
The first episode will feature the mayor of Cape Town Patricia de Lille, a prominent politician who has had to deal with numerous difficult changes in her life to be where she is today. This season promises to be insightful, informative, and most importantly, inspire the viewers. Viewers can also look forward to interviews with glamorous South Africans like Minki van der Westhuizen, former Miss South Africa Wilma van der Bijl and songstress and entrepreneur Patricia Lewis.
Says Ruda: “It is an absolute delight to sit down with South Africans as varied as Marc Lottering, Jesse Duarte, Max du Preez and Minki van der Westhuizen to talk about moments that changed the course of their lives. Do join us. You will be fascinated and inspired.”
Kim will investigate a variety of activities and trends like crocodile cagediving and homebreweries. And don’t forget the inspirational self-help inserts, where both Kim and Ruda will unpack topics like turning hobbies into businesses and genetic counseling.
Karen Meiring, director of Afrikaans channels at M-Net, says: “We’re looking forward to this follow up series and hope it will bring about change in people’s lives through the experiences of others.”
Suzanne Stevens, executive director at BrightRock, says: “As co-producers of VeranderDinge, we’re proud and excited to enter a second season of the show , especially after the first season’s success. VeranderDinge’s positive spin on Change ties in perfectly with BrightRock’s Love Change philosophy, and our needs-matched approach to life cover, which keeps up with the changes in your life. We’re looking forward to building on the success of the first season of this popular show.” /ENDS
VeranderDinge provides a glimpse on the lives of women. What inspires them? What motivates them? What are their daily challenges?
The programme is divided into three segments in which Ruda Landman and Kim Cloete look into a wide range of entertaining and insightful topics:
The programme will air on KykNet every Sunday evening at 18:30, with repeats on KykNet and KykNet & Kie. It premieres on 10 April.
About Ruda Landman
Ruda is a seasoned journalist and presenter who rose to fame during her 19 years as a co-presenter of Carte Blanche. Apart from her work in television, she is a successful lecturer, writer and MC. She also serves on the boards of the University of Stellenbosch, Media24 and Hoërskool Helpmekaar.
About Kim Cloete
Kim is an actress, scriptwriter, radio- and television presenter. She has a diverse portfolio of acting and presenting jobs in her portfolio, which includes appearances in programmes like Zing!, Ontbytsake, Isidingo and Villa Rosa. She also co-owns the Garden Court Theatre in Woodstock.
BrightRock is the provider of the first-ever life insurance that changes as your life changes. The company was started with the goal of creating insurance products that truly meet consumers ‘needs. BrightRock offers individualised, needs-matched life insurance cover that’s built around your specific needs at the outset, and is specially designed to change with you during life’s biggest Change Moments.
A Change Moment is the instant you land the job of your dreams; say “I do”; hold your new bundle of joy for the first time; or get the keys to your new front door. With these changes, comes a very real impact on how you think about and manage your money for today and for the future. And because BrightRock’s cover is flexible and changes appropriately when your needs change, it’s more efficient. This means both your cover and your premiums remain relevant, and more affordable, throughout your life. BrightRock (Pty) Ltd, underwritten by Lombard Life Ltd, is an authorised financial services provider.
April 2016. – VeranderDinge, die gewilde leefstylprogram pasgemaak deur BrightRock, is binnekort weer terug op KykNET en KykNET & kie televisieskerms. Die eerste episode van Seisoen 2 word Sondagaand, 10 April in ’n splinternuwe tydgleuf omstreeks 18:30 uitgesaai.
Grόόt veranderinge en name bly steeds die deurlopende tema van die program, wat deur Ruda Landman en Kim Cloete aangebied word. Dié gedugte span gaan in elke episode met invloedryke Suid-Afrikaners oor veranderinge in hul lewens gesels, en terselfdertyd kykers inspireer om verandering in hul lewens te koester en aanvaar.
In die eerste episode van die reeks gesels Ruda met Kaapstadse burgermeester Particia de Lille oor die grootste mylpale van haar politieke loopbaan, en hoe sy uitdagings as burgermeester baasraak. Kykers kan ook uitsien na onderhoude met glansryke Suid-Afrikaners soos Minki van der Westhuizen, oudmej. Suid-Afrika Wilma van der Bijl en sangsensasie Patricia Lewis.
“Dit is heerlik om met ’n veelsydige groep Suid-Afrikaners soos Marc Lottering, Jesse Duarte, Max du Preez en Minki van der Westhuizen te gesels oor die veranderingsoomblikke in hul lewens,” sê Ruda. “Moenie dit mis nie. Dit gaan jou fassineer én inspireer.”
Kim gaan weer in haar veelsydige insetsels na vindingryke tydverdrywe kyk wat wissel van tuisbrouerye tot krokodilhokduik – wat besig is om veld onder avontuurlustiges te wen. En moenie die inspirerende selfhelp insetsels vergeet nie – soos hoe om stokperdjies in besighede te verander en hoe om bekostigbare kinderpartytjies te hou.
Karen Meiring, direkteur van Afrikaanse kanale by M-Net, sê: “Ons sien baie uit na hierdie opvolg reeks en hoop dit maak ‘n verskil in mense lewens deur ander se ervaring.”
Suzanne Stevens, uitvoerende direkteur by BrightRock, sê: “Ons is trots daarop om as medevervaardigers van VeranderDinge terug te keer vir ’n tweede seisoen van die reeks. Die deurlopende tema van verandering sluit perfek aan by BrightRock se filosofie dat daar altyd ’n positiewe sy aan verandering kan wees, en komplimenteer ons pasgemaakte, aanpasbare lewensdekking. Ons sien uit daarna om te bou op die sukses van dié gewilde reeks se eerste seisoen.”
VeranderDinge verskaf ’n blik op ’n interessante verskeidenheid mense se lewens. Wat inspireer hulle? Wat motiveer hulle? Wat is die daaglikse uitdagings wat hulle in die gesig staar?
Ruda en Kim gaan ’n verskeidenheid vermaaklike en insiggewende onderwerpe in drie uiteenlopende segmente onder die vergrootglas plaas:
Meer oor Ruda Landman
Ruda is ’n gesoute joernalis en aanbieder wat veral bekend is vir haar 19 jaar as mede-aanbieder op Carte Blanche. Behalwe vir haar televisiewerk, is sy ook ’n suksesvolle lektor, skrywer en seremoniemeester en dien op die direksies van die Universiteit van Stellenbosch, Media24 en Hoërskool Helpmekaar.
Meer oor Kim Cloete
Kim is ’n aktrise, radio- en TV aanbieder en teksskrywer. Sy het ’n string akteurs- en aanbiedersrolle op haar kerfstok te danke aan verskynings in programme soos Zing!, Ontbytsake, Isidingo en Villa Rosa. Sy is ook die mede-eienaar van die Garden Court Teater in Woodstock.
Meer oor BrightRock
BrightRock is die verskaffer van die eerste behoeftegerigte lewensdekking wat verander soos jou lewe verander. Die maatskappy is van stapel gestuur om versekeringsprodukte te skep wat daadwerklik aan die verbruiker se behoeftes voldoen. BrightRock voorsien unieke, behoeftegerigte lewensdekking wat om elke individuele polishouer se onmiddelike behoeftes gestruktureer word. Dit is ontwerp om by polishouers se lewens aan te pas soos hul lewens verander in oomblikke waarna BrightRock spesifiek verwys as Veranderingsoomblikke (Change Moments).
’n Veranderingsoomblik gebeur wanneer jy die betrekking van jou drome losslaan; voor die kansel staan; jou baba vir die eerste keer vashou of die voordeur van jou nuwe huis vir die eerste keer oopsluit. Elkeen van dié oomblikke kan as lewensmylpale beskou word wat ’n groot impak op jou persoonlike welstand, finansies en toekomsplanne kan hê. Dit is juis waar BrightRock se lewensdekking in die prentjie kom – dit die enigste lewensversekeringsproduk wat aanpasbaar genoeg om te verander soos jou lewe verander. Gevolglik bly jou premies relevant en koste-effektief soos jy ouer word. BrightRock (EDMS) Bpk is ’n gemagtigde finansiële diensverskaffer, onderskryf deur Lombard Life Bpk.
BrightRock recently announced a three-year sponsorship of the Stormers. Destiny Man magazine spoke to the insurer’s Marketing Director Suzanne Stevens to find out more about sports sponsorship.
Tell us how the Stormers deal came about.
BrightRock has been growing from strength to strength since our launch in 2012 and quite early on, we knew that it was important for us to expand awareness of our business in the consumer environment. We threw the net quite wide, looking at different sporting codes and ventures outside the sports realm entirely. When the opportunity arose to partner with Western Province Rugby Union, it really felt like a no-brainer. It is a well-known, reputable brand with a strong national footprint and a diverse fan base. The opportunity to partner with other reputable companies like Adidas, Land Rover and DHL was also important.
What was attractive about sport as a sponsorship vehicle?
The reality when you are dealing with life insurance is that you can’t test-drive the product or put it on supermarket shelves, so we are always looking to make the brand more tangible. One of the lovely things about sport is that South Africans are passionate about it and it is a space in which we can physically manifest our business in a different way from the traditional financial services space.
What is your experience in sports marketing?
Prior to BrightRock, I was the General Manager of Marketing for the Discovery Group for 14 years. All sponsorships, including sport, reported to me. I have a network of contacts in this environment.
What are BrightRock’s future plans?
We currently have three sponsorship properties: The Dan Nicholl Show, which is an entirely new concept for South African TV and a broadcast sponsorship of a KykNet series called VeranderDinge, an extension of the Change Exchange online platform which features veteran journalist Ruda Landman. The Stormers sponsorship, of course, is the big daddy. Our focus will be working hard on delivering on these properties in the year ahead.
Do you have any tips for readers who are looking to get into sports marketing?
Ensure your marketing campaigns align 100% with your product. People will notice if something is not authentic. You have to develop business acumen and quality marketing experience and training will come in handy. Being a sports fan matters because you’ve got to have a passion for what you do. Tune into identifying exactly what your objectives are and how you are going to measure things. Be open to learning because the best plans are often laid to waste. Adapt, accept feedback and learn as you go along.
This article was originally published in the April Edition of Destiny Man magazine. Click here to read the original version.
Season Three of The Dan Nicholl Show – made for you by BrightRock – airs on SuperSport 1 from 16 March
Season three of The Dan Nicholl Show, kicked off on 16 March at 7pm on SuperSport 1, promising more celebrity guests, exotic shoot locations, and unexpected stories from some of South Africa’s most well-known people.
Guests in season two ranged from AB de Villiers, Akani Simbine and Kevin Pietersen, to Tumi Morake, DJ Fresh and Gareth Cliff, and after a seeing a marked increase in viewership and social media interest, host Dan Nicholl is excited about the line-up for season three.
“We have the Rio Olympics on the horizon, so look out for some Olympians coming up on the show, starting with 2012 London medallist Bridgitte Hartley in our first week,” Nicholl reveals. “We’ve also got Maps Maponyane on week one, which should send our teenage viewership through the roof, and we’ll have the new Miss South Africa and football star Quinton Fortune on the following week, so the guest list is already looking exciting.”
This lifestyle and magazine show boasts life insurance player BrightRock as its headline partner. It has a history of international travel, with past inserts having been filmed on location in Mauritius, Zambia, Switzerland, Scotland and England; season three will include time spent in Bangkok, Thailand, as well as something rather special from the Laureus World Sport Awards in Berlin, as Laureus continues as the show’s official charity partner.
“We’re also looking to continue the show’s good karma,” Nicholl adds. “(Former Masters champion) Charl Schwartzel, George Coetzee and Bertine Strauss have all won big golf tournaments since making an appearance. David Miller won a huge T20 game for South Africa, Moeneeb Josephs made a crucial penalty save in a knockout cup game for Wits, Stormers coach Robbie Fleck won his first two games of the season. Maybe we should have Steve Khompela on the show…”
The show will once again be filmed in front of a studio audience, and the #LoveChange showcase in partnership with BrightRock will continue to stock up with very personal gifts from guests. In season two, those gifts ranged from hockey star Shelley Russell’s first South African shirt, to Downhill World Champion Greg Minnaar’s winning riding goggles.
“We are immensely pleased with the growing success of The Dan Nicholl Show, which wouldn’t be possible without the fans’ enthusiastic support of the series. We are thrilled to continue this incredible journey and looking forward to Season 3, where we’ll hear even more stories of how icons have dealt with the Change Moments in their lives and careers,” concludes Suzanne Stevens, Executive Marketing Director, BrightRock.
Click here, to check out the new season promo:
Losing a key person in the organisation can put enormous strain on a company – both for personnel and the bottom line. Yet many companies still shy away from key man cover. RISKAFRICA takes a look at how the real experts are looking after themselves.
By Dominic Uys
Most businesses understand that losing the critical cogs in a company’s management team to life changing events such as death, disability or simple unexpected resignations, carries with it a significant cost implication (and possible business interruption). Yet many businesses remain a little wary of key man cover, in large part due to the significant cost that goes into premiums. And while those in the long-term insurance market are constantly advocating for the importance of these policies to their clients, one often wonders whether these financial services experts are following their own advice.
Origin Financial director Azania Swart starts by telling RISKAFRICA that Origin doesn’t favour any specific insurer when it comes to advice around key man cover for its clients. “We rather look for one whose benefits and the structure of those benefits fit the client’s (the business) needs when losing a key person due to disability or death,” she says.
When looking at brokerages specifically, she adds that it depends largely on the size and capability to sustain itself, as well as the role of the key person. “A one- or two-man brokerage is far more vulnerable when a key person ‘lapses’ and they should look at replacing their personal income stream for a good period of around two years (the time it takes for a new person to settle in or for clients to be notified and their portfolios properly reviewed and also the time in which most of his or her income will be affected); plus the portion of expenses in the business the key person is liable for, or contributes towards,” Swart continues.
Advice to a broker from a broker
Swart goes on to say that larger brokerages once again need to take a slightly different approach. “In a bigger practice where the role is probably a combination of management and servicing only a small number of clients, the person to be replaced is more a general business manager. Thus, a more accurate approach would be to replace a key person’s input via a multiple of salary calculation,” she says.
“This refers to the salary it would take to i employ the new manager, and should earn, for at least the six to 12 months it would take to settle in, and help the practice to absorb any financial losses. In a second scenario, where an adviser is key to a special set of skills and servicing a specific type of client, the focus of replacing this key person would be quite the opposite.
“Should this key person fall away, the brokerage could potentially suffer big losses and the business should make adequate provision. A specific calculation should be done on the key person’s income stream and the direct expenses to the business for a period of at least two years, as the loss of this key person will probably result in the practice losing a percentage of income. Plus a new adviser needs to be employed and expenses linked directly to the key person needs to be entertained for the period of time it will take to employ the skills or train a: new adviser in the specific field and inform 1 and take over clients.”
Swart notes that the average brokerage is in this regard, no different from any other. “The calculation methods of the insured amounts are over all types of businesses, but each business should look at what that key person contributes to income and expenses and what the loss to the business would be in that person`s specific set of skills and role in the company.
“And for the record, we do actually follow our own advice. Each key person in the Origin Group`s specific loss is calculated and addressed accordingly,” adds Swart.
Calculating your cover
Swart points out that there are a few general methods of calculating the amount of cover required. “A multiple of the annual salary of the key person, according to the time frame it would take to replace them, is one. This could be anything from two to five times their annual salary. Secondly, one could use the actual cost to replace a key person, including the advertising, training, et cetera. This is combined with the actual loss of nett profits.
“The latter is the more detailed and accurate method to use, and specific calculations and figures are used. In the end, the level of cover should be calculated according to that key person`s contribution to the business. Premiums are calculated as usual and according to the person`s risk profile.” she says.
Yet all of this broker-to-broker advice still leaves the question of how one cuts the cost of what is still considered a relatively heavy business cost. Naturally, Swart points to the importance of having proper risk management in place, which already allows a much more accurate insured amount to be calculated.
“The normal risk management that should be in place for any business, like the updated management accounts in order to quantify the key person’s role and contribution, the roles of each key person, the segment of clients serviced by each staff member, the procedures and processes to follow, compliance, et cetera. Also, one should determine if it is really necessary to take the whole insured amount and if the loss can be absorbed by the brokerage for a period while other arrangements are made to replace the person. Costs within the level of cover and premium should be minimised by the correct structure for tax purposes, and proper advice should ensure the most effective tax structure,” Swart concludes.
Have a five-year plan
Schalk Malan, director at BrightRock, tells RISKAFRICA that his company follows its own cost-effective solution to the key man insurance issue. But in order for that to work optimally, the business needs to get a few of its other ducks in a row.
“We started by identifying the different stages in our growth plan, and prioritising which positions and key people were critical in each stage. For us, the real thinking was much more around looking inside the business and the business dynamics, as opposed to finding a cover solution,” he starts.
“BrightRock doesn’t necessarily have a dedicated product that solely looks at the key man in a company. But our business life cover design is very well equipped to cover the key people.”
As far as following their own advice, Malan points out that the company has the same policy in place that it punts to the market. “To start, you need to make peace with the fact that if you have the same key man risk for the entire life of your business, your planning and your people planning is at fault. You actually want to develop your people within the business, so that if someone moves on, passes away or becomes disabled, it doesn’t become a big disruption in your company. It is always better to have home-grown skills to take that place immediately, than it is to actually go out and recruit someone from outside.”
“Look at that line of thought as a backdrop of what we’ve done. We established that the business is on a certain growth trajectory. We reckoned that we probably had a key man problem in specific areas for the next five years. And if you look at our product, it allows you to price the cover for your business for the duration of that five years, with the option of converting those premiums for a longer duration,” he says.
“That was a really good solution for ourselves because we set the most cost-effective plan in place. You don’t want a whole of life policy in place when your planning obviously needs to extend to only five years. After that time, you need to revisit the situation and establish whether the key man risk involving person X has been resolved. If it continues with some individuals, you have the ability to extend that, which is a very cost effective thing for a business.”
Coupled with that, Malan imparts that the company must actively work on putting contingencies in place. “Having skills in place to take the reigns if one of these life-changing events occurs to one of your people, is also critical for your business plan. Because you might one day want to enter another market, you actually need people who know your business intimately in order to effectively take advantage of those opportunities. It should be part of a full development strategy that must work hand in glove with the cover.
“So we have that in place, and we do review it on a regular basis. Our model was to look at how much it would cost to recruit a person, taking into account the recruitment fee, as well as things like take on bonuses (usually a sizeable amount) and the rest. The reason why many businesses shy away from key man policies is for exactly the reason that most policies cover the whole of life, making it an expensive option for any business. Which is why a policy that is only underwritten for a shorter duration, for instance five years, is actually a lot more appealing as a cost-effective solution,” Malan continues.
As a final piece of wisdom, Malan states that a company needs to seriously consider its own attractiveness as an employer. “It goes without saying that this seriously influences how difficult it might be to replace a key man,” he says.
Replacing a board member
As a final thought, do the boards of volunteer organisations ever considered the contingencies for filling a sudden vacancy in their own midst. Gavin Came, chairperson of the Financial Intermediaries Association (FIA) financial planning executive committee quickly shut down that line of questioning by saying that, generally speaking, key person policies are not considered by volunteer-based organisations like the FIA for a number of reasons.
“These organisations have no profit motive which means that one cannot place the ‘usual’ financial value on the key person by calculating profits lost. In most volunteer associations, the value that the non-executive directors present is their length of service and experience in the industry. This is not simply replaced by money,” he explains.
“Secondly, most volunteer associations are finely tuned to make no profit and, therefore, the value of a ‘key non-executive’ is not measurable. In any event, it would be difficult to justify the cost of insuring an unpaid volunteer. Most non-profit organisations also have their work cut out for them in attracting and retaining the skills of the volunteer, and no amount of money paid out on a key person basis can be used to attract the volunteer,” he continues.
“Finally, usually the permanent or executive staff in a not-for-profit organisation can be temporarily replaced by a volunteer while a replacement is sought, of course in this area there may be justification in conventional key person insurance and a succession plan.”
“While it could be argued that non-profit organisations can benefit from key person policies on certain executives, the reality is that once such organisations have built up sufficient reserves to sustain themselves, this type of cover would not be that important. There is no need to ‘protect’ profits as there would be in a for-profit business,” Peter Atkinson, national technical portfolio manager at the FIA adds.
“Key person policies for intermediary businesses would not be significantly different to those provided by insurers for other kinds of businesses. There is, however, a need to accommodate the FAIS Act succession planning requirements (specific to advice firms) as well as other risk management processes that are unique to this class of business,” Atkinson says.
Turning to financial planning practices, Came could impart some advice. “There would be a range of responses depending on the size and level of specialisation in each business. Obviously, as in any one-man business, a one-man financial planning practice would not be able to justify key person cover since his or her demise would leave the business without accredited staff to continue. Our members are required by law to have a succession plan and we encourage our one-man members to engage with each other to create a succession plan, especially as the FAIS Act requires accredited people to continue the business. However, the cover required in these cases is more in the nature of partnership insurance than key person since it would involve a change of ownership rather than a change of employees. Our larger members would take out key person cover based on need, but we are not privy to details of these members’ arrangements,” Came concludes
* This article first appeared in the February 2016 edition of RISKAFRICA magazine, pages 82 to 86.
After Davos-veteran Alec Hogg shared some some of the vital take-outs from the World Economic Forum’s 16th Annual Meeting (#WEF16), he sat down with media veteran David O’Sullivan to talk about South Africa’s economic and political prospects for the year ahead.
BrightRock illuminated all Alec’s news coverage and analysis from Davos in BizNews.com, before he presented the key take-outs from Davos during a breakfast for BrightRock’s Laureate advisers at Blue Valley Golf Estate in Midrand after his return from Switzerland. Watch or read the full conversation below:
[DAVID O’SULLIVAN] Alec, if I could start with a couple of issues you raised right at the end there. And they are the topical issues. We have the State of the Nation Address; what do you think, and I’m not going to ask you what Jacob Zuma is going to do, but what should he be saying in his State of the Nation Address to appease foreign investors that South Africa is still the place to be? Now that was his expression in Davos. He said to foreign investors that this is the place you should be. What should he be saying to persuade foreign investors that South Africa is still an option?
[ALEC HOGG] Shoo, David. I think the reality of where we find ourselves as a nation is a little bit like a company that has just had its reputation destroyed. Reputational risk is something that we should all be aware of. Warren Buffet says that you don’t ever do something that will land you on the front page of a newspaper that all your friends are going to read and you will not be proud of. And we’ve done that. We’ve landed not just on the front page of the paper that all our friends read but that all our enemies read as well. What happened to this country in December and the reputational risk that was created, at that point in time and through Nene-gate and prior to that, just emphasized the direction the country was going economically. The challenge that now exists is rebuilding that reputation. And that’s not going to happen overnight. But Pravin Gordhan has been…you know, the business hasn’t met with government seriously for about seven years, literally, and Pravin Gordhan is now initiating that process. Zuma literally goes along to those meetings and sits there and chuckles and Pravin runs them. There’s a process that is now moving in the right direction. I guess the best … what we should be hoping for is a return to sound economic policies; a realisation – and this is really what the big story is – after 2008 we had quantitative easing. Quantitative easing, just pump money into the system. So it didn’t matter how good you were or how bad you were – you just flourished. The whole world flourished. Even a moron – and he is a moron – like Chavez, he’s dead now and you can’t defame the dead so let’s go for it. But what Chavez did to Venezuela is unconscionable. He had an oil price of $100 a barrel and he could do what he liked. He could employ crazy policies. Venezuela has voted out the socialists after 16 years and voted in a new government but the old government doesn’t want to let go. I mean it’s a crazy thing. Argentina had the same situation but the new government is in there. But the reality was that when you had this easy money just flooding the system you could get away with anything. And you did. So 21st century socialism flourished – including in South Africa. In South Africa if you take a look at how our budgets have been structured over the past few years – it’s been more spending on the social net and less spending on developing the economy. It’s been more tightening of the socialist type rules which restrict growth and less freeing up on those market type rules which promote economic growth. As a consequence we’re one of the worst performers on economic growth at the moment. A reversal of that tide is going to require political courage; and if we can see a start in that direction, first in the State of Nation and secondly in the budget, then we’ll start going in the right direction.
[DAVID O’SULLIVAN] He’s certainly sending out signals to foreign investors that things are good in South Africa. He was saying we are open for business. From the people you were talking to in Davos is that confidence that the President is exuding is that shared? Is there a belief that South Africa at least still provides opportunities for foreign direct investment?
[ALEC HOGG] Well, again a lot of these things are a process. You might recall that there was a very rapid visit to Angela Merkel by Jacob Zuma towards the end of last year. And after he arrived back Mercedes Benz announced a R4 billion investment. Now the timing was not coincidental. There were certain guarantees, no doubt, that were provided in those discussions. The Brand South Africa every year in Davos takes the Kirchner Museum which is a landmark area. It was like a morgue this year. There wasn’t interest. The trouble is you screw up and then you say: ‘Oh hell I’m sorry, please come back.’ Or, things aren’t what they seem to be, or … the first step to recovery is admitting we’ve got a problem. And Pravin has done that. The President is in a different zone.
[DAVID O’SULLIVAN] He was talking about, also, in his statement – in his speech – in Davos; he spoke about Invest South Africa; this initiative to ease constraints to get rid of the bureaucratic slowdowns to ease foreign investment in South Africa. Is it making South Africa more investor friendly? Is that an initiative that’s going to bear fruits at any stage do you feel?
[ALEC HOGG] The problem is he signed into law the ‘Promotion of Investment Act’ in mid-December while nobody was paying notice. That’s the worst thing that you could think of. In this day and age we have many social imperatives in this country and really we can all buy into them. We can buy into BEE, we can buy into the fact that the previously disadvantaged need to be brought into the system. And it’s true. And it has to happen. But you can’t say to a foreign investor to come to the country but give away 50% of what you put in. Why? Why would they do that? They’ve got the rest of the world to choose from. So, you’ll find where the investments are happening here are where there are special dispensations. The ‘Motor Industry Development Plan’ is extremely attractive to the motor manufacturers. As a consequence we have very happy motor manufacturing companies who are expanding it. When the tide goes out; when the easy money tide goes out – you see who’s been swimming naked. To use another lovely Warren Buffet term. Both Christine Lagarde of the IMF, and there were other commentators as well, said that countries like South Africa and Brazil have not taken advantage of the good times and now they have to struggle through the bad times. So when you hear Gordhan talk about structural reforms and grasping the nettle and spending less than we earn etc. then for the first time we are hearing the right language. For the first time, literally since the Zuma administration took over. The Zuma administration I would remind you, were saying a few years ago that we’re going to create 5 million jobs by 2015. And then it’s we have a good story to tell. And, and, and… I don’t know if it’s because the Presidency is very poorly advised, or whether within the Presidency there’s just no grasp of these major issues. But there are people within the cabinet who are … and there are people within the top six of the ANC who are very mindful and very aware of these issues. And if you go back to the ninth of December when … you know that was like the final straw … with this guy who was chased out of Carletonville as the mayor being appointed as Finance Minister. And Trevor Manuel said afterwards … and then being painted as superstar … Trevor Manuel felt strongly enough to actually issue … to write a statement to City Press newspaper, an open letter, where he said that if this guy was such a star why did I never see him in the five years I was an MP in Parliament? So that whole thing has now unravelled. Sometimes you need to push the envelope just that little too far and it appears as if 21st Century Socialism did that and it’s now being reversed. So, if you were to take South Africa, would I rather be sitting in South Africa today or on the 8th of December? I would choose today a lifetime. Every lifetime, because we actually hit that issue that opened everybody’s eyes … to the reality to where we might have gone to. And the problem is if you’re used to bullshtting, it’s very hard not to bullshit. If you’re used to propagandising or thinking that people listen to your propaganda it’s very hard to reverse that. And until you van grasp the modernity of a complex economy like South Africa where everybody’s informed … I mean the Edelman’s Trust Barometer was something if I were running the government I would be terribly concerned about. Because if only 16% of the people of this country believe that they can trust the government … if you had 16% of the people believing they can trust your company you don’t have a company. So those are the realities that are being grasped in certain quarters but it’s politics … and politics, and sometimes you have to get the votes.
[DAVID O’SULLIVAN] Let’s talk about Pravin Gordhan. We’ve got the budget coming up. You’ve mentioned those IMF figures dropping the forecast for economic growth from 1.3 to 0.7%. Pravin Gordhan in one of the addresses Davos said that the challenge is to see what we can do differently to surprise the IMF. Is he able to pull the rabbit out of the hat as soon as the budget; is this a longer term process for him? What are you anticipating for the budget?
[ALEC HOGG] He’s got, we’ve all got as South Africans, a long road ahead of us. We blew it in the good times and now we don’t have the advantage that some countries had from the good times. Many of the enlightened countries took the money, even Nigeria from their boom, and they stuck it away into special funds which they can now draw on. We don’t have that benefit. And the most important thing that one has to look for in the budget is that Pravin is actually following through on what he’s been saying. If he is as … you know R.W. Johnson who wrote that magnificent book, if you haven’t read it, ‘How long will South Africa survive?’… It’s a … to be an informed citizen of this country you should read it. Because it often … people just go by headlines and then go by reality and he makes the case quite forcefully of what really is going on in the country and has been going on in an economic sense. And his view still is that at some point in time we’ll go into junk status and then have to ask the IMF for a bailout which he said is a good thing. Because when that happens the IMF gives you certain conditions which are common sense economic conditions and then you get rid of all the rhetoric and you can you blame it on the IMF. You have to do this, like flexible labour legislation and all the other obvious things that they’ve been saying for years and that we’ve known for years is wrong with this economy. So the reality of where South Africa is going … Pravin says we can avoid junk status; R.W. Johnson says it’s just a matter of time. Pravin has the tools at his disposal politically to make those changes. R.W. Johnson says Pravin is ‘unfireable’. And I think that anybody who saw the tailspin in the Rand after Van Rooyen was brought in and before Pravin was re-appointed will have to agree with that. But then again, stranger things have happened in politics so let’s just hope we don’t go and blow both feet off with one shotgun.
[DAVID O’SULLIVAN] But you don’t expect a kind of Rubicon-type reaction to the budget? The budget is going to be something that will consolidate our position. Just steer us in a steadier course than we have been.
[ALEC HOGG] Well, Nene was a very good Finance Minister. And he managed to, against all odds, to balance the books. He did it through sleight of hand; if you know the numbers and look at them. Last year we had the Unemployment Insurance Fund which was … which was … got plenty of money. He took R16 billion from that; effectively it was supposed to go into the Road Accident Fund and never made it there. It went into the coffers which as, as far as an international investor’s concerned is not a bad thing. Because it meant you balanced the books. But if you took that R16 billion out you might have been in a more difficult situation. What the world looks at are just a few stats really. The big one … it’s like when you look at international companies you see what’s their PE ratio, what’s their dividend yield and you can then scan many companies at the same time. When you looking at countries you look at their budget deficit, percentage wise, and their debt/GDP ratio and then the higher, the worse it is. So in South Africa we’ve gone from a debt to GDP ratio of 26% when Trevor Manuel was running the place to over 50% today. In a developing country you shouldn’t really get to 50%. You should try to keep it at least below that. However, the good news is Japan is at 200%. So rather be a South African than Japanese at the moment.
[DAVID O’SULLIVAN] Right, let’s take some questions from the floor. I did see a gentleman with his hands up over there. Please wait for the microphone because are recording this and need to capture the sound of your question as well.
[QUESTION FROM THE AUDIENCE] Good morning colleagues. I would like to ask the gentleman a question and then from there I’ll make a statement. My question is would you prefer Jacob Zuma to be President for six months or rather have Thabo Mbeki to have four terms as a president?
[ALEC HOGG] No question. If we go the route of fiddling with the constitution then I don’t believe South Africa has a future. We’re a constitutional democracy with a constitution where the constitutional court is the supreme body in this country. So I would … I know where you’re going with, I think I know where you’re going with his … If Mbeki had wanted a third term as has been widely speculated and believed at the time then I think the whole country did the right thing by not allowing that.
[QUESTION FROM THE AUDIENCE] But the reason I asked the question is that reality is that we don’t have many candidates … who … fit candidates to be president of this country. More especially from the ANC. Cyril Ramaphosa, I’ll count them one-by-one, Cyril Ramaphosa he has already dented himself with Marikana to be part of the mess that the country is in today. So he’s not a fit candidate. Mmusi Maimane doesn’t speak to the ordinary masses of this country. So I’m simply saying, I’m suggesting or my view is that we need to change the constitution to allow people who are fit and proper to run this country. Because we cannot have a situation whereby we are limited by the constitution to have any guy who just stays for two terms and from there we get another guy who is incapable who brings the country down.
[ALEC HOGG] I can’t disagree with you more. Thankfully we are in a free country where we can have our own statement. I would just say to you though to remember that power corrupts and absolute power corrupts absolutely. All we have to do is look to examples on our continent where constitutions have been changed; where we have presidents-for-life. Supposedly good presidents and unfortunately that is part of the human condition.
[QUESTION FROM THE AUDIENCE] And then secondly … I also …maybe this is political. I disagree with the fact that Africa contributes 3% to the global GDP, you know? If you look at Africa as a continent it’s the richest continent in the world. The problem is just that the Europeans are systematically destabilizing Africa. They take resources from us. And they actually depend on Africa to survive. So that need’s to change so that they come and invest in the country and also empower the citizens of the country. I just believe that there’s just so much in Africa which Europeans are not doing for the indigenous people of the countries. I’m also against BEE because it only empowers the few black elite.
[ALEC HOGG] We agree on lots … we are always going to disagree on the numbers. The numbers are clear. Africa’s contribution to global GDP is 3%. You can take all the GDP on the continent and add it together. But we do agree on a lot more. My approach to these things is that we cannot be emotional. The world doesn’t need us. The world doesn’t need Africa. And it’s shown. You know there’s massive amounts of aid that are pouring into this continent through the good people of other parts of the world; not necessarily the politicians. We have no right to anything, we have to pull ourselves up by our own bootstraps.
[DAVID O’SULLIVAN] I think you are right; the potential for Africa to be a greater contributor to global GDP should be a lot higher. But as Alec said the reality is at the moment it’s 3%. Raise your hand if you’ve got any more questions; we can send the microphone. …
[QUESTION FROM THE AUDIENCE] Howzit, Alec, I’d like to just…uhm … you mentioned briefly Britain and India being … you know … apart from the rest. India’s almost been quiet in the news. Just quietly growing by 6%. And from the people I speak to there, they’re very happy with their government. Also a massive economy. What are the views out there in terms of their contribution to the global picture? Because it’s almost, from a media perspective, it’s dominated by China and Brazil and these places but it’s been quite quiet in India. These are good things. I would just like to hear what the Davos reviews were on India?
[ALEC HOGG] India is an interesting country for us to look at as a model. Because when the liberation movements finally succeeded in India it took 60 years of reimplementation of the Raj – the licenced Raj they call it – before they threw out the socialists. Which they did last year and Narendra Modi’s party was voted into power. What is interesting, and it’s a similar situation that happened in Argentina, in India Modi was running one of the states. And the state was an outlier to the rest of India. The policies he had implemented there were modern economic policies. There’s no reason why the United States should have 26% of global GDP with only 5% of the people. The only reason is that they have economic policies that promote the efficient distribution of goods and services. It’s that damn simple; when you put obstacles in the way of human ingenuity then you will not grow as fast as those who allow human ingenuity to grow. So what happened in India last year when they changed their government was that they started implementing lots of new policies. They grew last year at 7.5%. The Finance Minister, Arun Jaitley, was quite celebrated in Davos this year and he was saying that it should have been higher than 7.5% but they had a really bad monsoon on which two thirds of the Indian population rely. So they’re expecting a base-load of 5% he said; they won’t go below five and they’re expecting quite a significant increase over that. The Indian example tells us how corruption can destroy a country’s fabric. When the British colonialists were in power they ran it like a colony and as a consequence anything you wanted to do you had to have a licence for. So when it transitioned to the new government everything you wanted to do you needed a licence for … And if you can imagine a more fertile ground for corruption than that; you have to pay someone to get the ability to actually do something. And they’ve suffered under that for 60 years. India is … you won’t find more enterprising people. We know this from our own group of people from an Indian background in South Africa. Massively aware of value, very enterprising, very hardworking, very able to develop business pretty quickly in the most difficult conditions as they did in apartheid South Africa. And when you unleash that potential then you have another China happening. The reality is now that with that potential being unleashed; with just a different approach towards governance and corruption, India is the next driver. It’s pretty consistently believed around the world that that’s what’s going to happen. Britain is a small population. India has a billion people, Britian has 60 million. Although Britain is well positioned for the fourth industrial age, and it really is, because of the history of the British. They are tolerant, they are educated. You know why do the Russians and the Iranians and the Israelis buy expensive property in London? Because they think that the political system is stable and continue is going to. The advantages that Britain has in this fourth industrial revolution that we’re going into is enormous but the size of its population means that it will never be the driver that India or China would be.
[DAVID O’SULLIVAN] You met some very interesting people in Davos, Alec. You spoke about Ian Golding, The age of discovery, the new renaissance being led now by the developing countries; you spoke about India, China. You also mentioned in your address, you touched on Argentina. Just flesh out a little bit more about the lessons that Argentina is teaching us? What’s happening there?
[ALEC HOGG]It’s a wonderful time. It reminds me of ’94 when we had the ANC government is South Africa about to take over; with idealism, with bright eyes, with enthusiasm, with the determination to fix everything of the wrong of the past. And to make it new and to make it fresh. We have a … Davos is like the typical Swiss. They have a number of different organisations that the more you go there the more you move up the hierarchy. I’m a member of the International Media Council. There are about 70 people who are on this. And we have a day that they organise presidents, three presidents to come and see us. It’s a small little group, maybe 30 who are there, because not everyone in the International Media Council comes along. And the presidents usually bring along their entourage. The president of Iran, Rohani, came a couple of years ago when they were trying to woo the world media or the world really for investments. And he had to huge big bodyguards standing either side of him. Which is the only thing I remember of what he said. Last year the Turkish guy was there who was quite aggressive. And this year we had like three different presidents. We had a guy who is a top coder, who’s the Prime Minister of Canada, Rock star president – Justin Trudeau. I mean he really is. He looks like he could be a Justin Timberlake or something. And young. Very young. And then we had a 66 year old Princeton professor who is an Afghan and went back to Afghanistan and stood in election and was elected as president in that country. And left this very privileged existence in the West to become dedicated to the cause of his own country. If you think you’ve got problems in your own country, that’s the wonderful thing about Davos, just look around you and you will see they just pale into insignificance. He was fascinating. And then the third of these was Mauricio Macri, who is a little like Modi in India in that he ran Buenos Aires as a more modern economy, just the city. Just like Bloomberg ran New York City. And he made such a success of it that he used the prospectus of Bueno Aires as a prospectus for what he would do for the country. And there was a massive swing in Argentina, again after a decade and a half of socialism. They voted the socialists out. Voted Macri in. One of the first things he did – there was a running fight between Kirchner, the previous president, and the international community over bonds that Argentina refused to pay – he went and settled them. He said, he told us, it was all off the record but I can tell you this now because it’s happened. He said: ‘My first priority is we got to get back in the international capital markets. We can’t be an island on our own; we need to embrace the world. We need the world’s money. And that’s what people often forget about a developing country. Developing countries need the world’s money. We in South Africa know it better than most when in 1985 when PW Botha’s Rubicon speech was made, Willard C. Butcher, the chairman of Chase Manhattan Bank, after that cut off credit lines. And if those of you with memories will recall that between 1985 and 1990 South Africa had what was called a debt standstill and we had to export capital. And as a consequence, we just didn’t have capital to export, and the economy then just imploded on itself. The consequences were that the transition to democracy came a lot more rapidly. That was exactly what Macri has seen. He was a business man. He understands business. And increasingly around the world you’re seeing business related people who are getting into more positions of authority. And if there was an ETF in any country in the world today I would buy in Argentina. You just see they just hit rock-bottom. The people have gone through so much pain that they’re just not prepared to carry on with it. And they’ve rejected the ideological issues that have taken them into this trouble and started embracing the old-fashioned ideals of let’s work hard and we’ll make it happen.
[DAVID O’SULLIVAN] Any questions from the floor? I’ve got a few more issues that I would like raise with Alec as well. This issue with this new age of discovery, the new renaissance; where does South Africa fit in as a player? Do we … are we up to speed? Do we have the skills? Do we have the education to be part of this revolution as it’s unfolding? [ALEC HOGG] David, I’m very positive on this because we are in the top … remember we are a small country. There are seven billion people on earth; we have got 54 million. We’re manageable and that was the thing when I spoke to the guys in India about our challenges in South Africa. They said: ‘We’ve got 300 million people who are in deep poverty in India’. So although India is moving in the right direction; the challenges that they face are just so much greater. We in South Africa are in a very very privileged situation. We’ve got the first three revolutions. We’re in the fourth revolution. We have very smart people. You just look at people around the world from South Africa and what they’ve done. The greatest entrepreneur in the United States today is Elon Musk and Elon Musk is from Pretoria. The people who are transforming the whole solar energy market are a company called Solar City. It’s run by two brothers, the Rive brothers from Pretoria. Maybe it’s just Pretoria. [Laughing] No. We do have an engaged population that are well educated, or if you like, a sliver who are well educated. We have a desire that not many other countries around the world have to do good. There’s an ability by South Africans to embrace the new world that we’re going into. I mean not everybody likes some of the restrictions that have been applied to doing business in South Africa but you kind of embrace it. People in South Africa do social responsibility because they want to do it not because they have to do it. So there are a lot of things that are to our advantage but the biggest thing, why I’m most excited about this, is that we have the tools with which to take those 54 million people and to give them the opportunity to participate in the fourth industrial revolution. You know that the Vice-President of Nigeria was saying that they literally don’t have the resources to go out and build a 100 000 schools. So what they’re doing is taking mobile phones and training teachers; 600 000 teachers in the next few months on mobile phones. And using mobile phones as a way of educating those millions of kids in a country of 160 million people who otherwise would just have no education whatsoever. So it’s that leapfrogging. We’ve got the infrastructure. We’ve got the telecoms infrastructure. We’ve got the desire. We’ve got the incentive. We’ve got the desire. Everything is there; we just need to unleash that human potential. Sometimes you need to hit a hard place where you realise that people actually do a hell of a lot better when they are given the opportunity to have their own potential unleashed rather than being fed. And I’ll use probably the most remarkable person I met in Davos this year was Mohammad Yunus, a Nobel Peace Prize winner. As it happened, you know you get lucky sometimes, we were staying in the same 3-star hotel. And he … I had a half an hour with him … and what he said … and my wife who has obviously sat in on a lot of these interviews just to listen said that she’s never ever been so inspired. He’s a short little guy. He started a thing called Grameen Bank. He’s feisty as anything. Some of the questions I asked he didn’t like and he kind of almost wanted to box me over them. But Grameen Bank is in Bangladesh and again you think we’ve got problems; look at Bangladesh. What he did there was he found illiterate, unemployed women and started off lending them $30 and the $30 loan, once they’d been able to repay that, they would get more. It was all to do with giving the ability to employ themselves. And it’s been a massive success story. Hundreds of thousands of unemployed illiterate Bangladeshi ladies have created business because of Grameen Bank. It’s why he won the Nobel Peace Prize. It has been that successful. In fact the Indian Finance Minister went to visit with him and applied something that he’s applied, which was what was really inspiring to me, to create a hundred thousand new businesses in India in the last few months. He said the problem was, after 30 years on, after all these illiterate ladies from Grameen Bank had taken their kids and sent them to university and their kids came out of university with their degrees they sat at home and waited for someone to give them a job. You see that’s not the way the world works, when we came out of wherever, mud huts, caves whatever or that time our ancestors came out of those places they didn’t put together their CVs and go around and asked people to employ them. The human condition is self-employment. Other people are not there to give us a job. We need to create our own jobs. So he took these kids who were sitting there, far better educated than their parents, he’s taken them back to university – to his Grameen Academy – and he starts teaching them about entrepreneurship. Most of them didn’t have a clue of what business to start. So as a consequence – because he asked them for business ideas – as a consequence for the next six months you’re going to work with your mother. And you learn from your mother about entrepreneurship. And so as a consequence once you come back we will lend you the money. We will own a 100% of your business from day one. But as you repay the loan … You own a 100% when you have repaid in its entirety. Last year he started 5000 new businesses this way. This year he started 30 000 new businesses. And the Indians have applied the same principle and started 100 000 new businesses. It’s all a question of allowing the human potential to come out. They’re doing it in Bangladesh; they’re doing it in India. It’s possible in this country.
[DAVID O’SULLIVAN] I’m sure this strikes a chord with a lot of our audience here as people who I’m presuming are running their own brokerages, the self-employed, this philosophy of social entrepreneurship that Mohammad Yunus has been talking about must ring true. I wonder though how appropriate and fit that model is for South Africa? Is that something we could be borrowing from?
[ALEC HOGG] It’s the only way. If we are looking at a 50% youth unemployment rate in South Africa, which we are, and we’re looking at an overall unemployment rate of 25% and our best ideas got us there; we need to find new ideas. [DAVID O’SULLIVAN] And you reckon this is an answer, this is a model. Has anyone in South Africa expressed an interest in this model that Mohammad Yunus has come up with?
[ALEC HOGG] David you know our people aren’t lazy. And when I say our people, as you know I spent two and a half years farming in Mooiriver. I took a semi-sabbatical. And the tragedy about Mooiriver was that it’s got 80% unemployment. Mooiriver is a little town, dirty little town, halfway between Pietermaritzburg and Ladysmith in KZN. And the reason it’s got 80% unemployment was they used to have a very big textile factory there called ‘Mooiriver Textiles’ – what else? And Mooiriver Textiles because of demands from the labour pushed up the salaries to the point where they no longer could compete. And the Taiwanese came in, just after democracy, and the place was going to be closed down. And the Taiwanese then did a deal with the government which no one really talks much about because it’s not politically that correct; where they could pay different wages. So they’re paying really really poor wages to people but they’ve just got jobs. Some of them; of course they cut this workforce down to a fraction of what it was before. We were getting on the farm people coming to us. A lot of people, as many as we could possibly employ who would do anything for R60 a day just please could I work for R60 a day. Now, it’s not a question of people not wanting to work. It’s not a question, and I hear this often, that South Africans are entitled. Chris Hart got into a lot of trouble for that. I don’t believe it’s got anything to do with that. I think … I really believe it’s do with just being able to get off, or get into, the game. Get into the game. Even if it’s through having buying a sewing machine. Finding someone that will lend you money to do that. Everybody, as Mohammad Yunus says, is a born entrepreneur. We get taught through conditioning … he says it goes back to slavery but also through the industrial hierarchical structures that we don’t need to fend for ourselves anymore or that someone else will fend for us. And it is part of the human condition that’s been adopted and is now having to work out just as human beings. Remember, when Craig Venter did the DNA testing he discovered that 99.9% of our DNA as humans is identical. Forget about black and white; think about someone who is Papa New Guinea or an Intuit in Canada. And yet we take that 0.1% and make it the be all and end all of our existence whereas we should be looking at the 99.9%. And I think the human condition is one of we want to all do better – just give us a chance.
[DAVID O’SULLIVAN] Some final thoughts, Alec, before we wrap up. I was looking back at December and having covered South African politics for 30 years; I’ve seen us on the brink of civil war so many times, the slumps, Rubicon, all of those things that I had the fortune or misfortune of reporting on … I don’t think I had ever been as demoralized as I’ve been in December. Reading BizNews.com there are a number of articles that you write the words ‘hope springs’ into them; giving me a reason to think things are going to start turning around. We do know 2016 is going to be a rough year. I look at a bunch of … a group of brokers here who are looking to do business in 2016. How rocky a road is it going to be? Is it a train coming towards us or is there real light at the end of the tunnel?
[ALEC HOGG] I love what Warren Buffet says about these things. He says that these big trends are too difficult to call. You should just stick on what you can actually influence. Your circle of competence. That’s something every South African should look at. I remember having a conversation with … I was called in to a group of grumpy white old guys who were very upset about corruption and pointing fingers like crazy. And we had quite a vibrant discussion because after they had told me how bad everything was I said: ‘But well what are you doing about it? What are you doing in your own company? What are you doing about within your own little patch?’ Because I don’t know why Jacob Zuma’s got four wives. I really don’t. I don’t understand it. It’s … and I don’t even … I cannot judge it. It’s his culture, it’s where he comes from, it’s his mind-set, it’s through his ten years on Robben Island, and it’s through everything that he has had to do in his life. I don’t understand that, and by the same token if I don’t understand it, how can I try and change it. What I can change though is make damn sure that when that traffic cop pulls me over and he asks for a bribe; I tell him to “F you!” And if he wants to take me to the police station I’ll go to the police station with him. And I’ll make sure that I tell as many people as possible who he is and why he’s done that. Those are the little things that civil society can do. The kind of country I want to live in is one where I can just … You know that beautiful story of the starfish on the beach? A little girl…a guy come along there, there’s a little girl there. All the starfish have been washed up through the tide and the little girls is pick up the starfish and she’s throwing them back into the sea. And he says: “Stop it, man. You’re just … you’re just wasting your time. You’re not making any difference.” And you see what it is to him. And that’s my kind of philosophy on life. It … it just … I can operate within my circle of competence; the things I know the things I understand. I believe that there I can make a contribution. There is a lot of good everywhere but sometimes the mood will take us into a place where we don’t see the wood from the trees. We … we … we wake up in the morning in a frame of mind … and these poor people who drive from here into Johannesburg everyday … and … I … I guess they got an excuse but the rest of us really don’t. We wake up with a frame of mind which says oh woe is me … I can’t leave the country … I am going to meet grumpy people today … Everything is going to hell in a handbasket …woe is me. I don’t believe that that’s the human condition either. I think it’s more a question of how can I approach things within my circle of competence. And when we see things happening in the country that are positive then we need to acknowledge them.
We have a fantastic Minister of Education and if only somebody could realise that this lady is taking on such unbelievable corruption and difficulties but she’s bravely attacking them. You know in … in education … in certain parts of education you buy headamasterships. So once you buy the headmastership through the union … and it’s all in court, I’m not telling you new stuff … you own that budget that comes from the department. And she is trying to change that. She’s working really hard and standing up and saying that it’s wrong. We had Nhlanhla Nene, the Minister of Finance, who was summarily dismissed, saying: ‘There’s terrible things happening at SAA and I will not allow it any longer. There’s no way I’m going to countenance the nuclear deal.’ And he got fired for it. Those are the kind of people who are role models for us. Those are the kind of people we should be inspired by. And I believe, unlike one of the early commentators, that we have many options and many many alternatives to the current leadership situation because we have great people in this country. We’ve seen it time and time again. But it all starts at home and it starts in the way I perceive this. And it starts with going to the … you know, when I go to the garage and fill my car up with diesel and have a chat with a very smiley guy there who gives me his point of view on the day. Or … when I’m walking down the street in South Africa, I wave at someone and smile and they’ll wave and smile back. Not many parts of the world where that is. So, sometimes we kind of get a little bit too caught up in the big stuff; in the stuff we can’t influence and we can’t change and we forget that there’s lots that we can do within our circle of competence.
[DAVID O’SULLIVAN] If there aren’t any further questions … Oh, there’s a question over there. Can you just wait for the microphone to come your way? [QUESTION FROM THE AUDIENCE] You spoke about robotics. And we this this is fast becoming a reality worldwide. Would this destroy South Africa? Or build South Africa? Considering we have a very low skills base here?
[ALEC HOGG] That’s a really good question. The … the … the old way of thinking is going to give us more problems from the transformation. The new way of thinking is going to give us opportunities. So we can either look at this and continue along the path, the lemming path, that’s going to take us over the cliff; or we can look it and say that we really need to think differently. We need to bring in the thoughts of a … a Grameen Bank …a Yunus Mohammad … Mohammad Yunus. His kind of approach. Because the way we are doing things now … with the fourth industrial revolution coming on top of it then we really are … are looking at … a … A lovely story I would like to just share with you … uhm … when the Blue train at one point in time was on the same track as a cargo train…it happened some years ago and…uhm…the two were heading towards each other and they hit each other as they were going to … uhm … the SABC sent out a camera crew to interview the driver. And they said to the driver of the Blue train: ‘What did you do?’ and he said, ‘Well, what happened was I was looking there. And I had a look around the side and I saw this train coming at me and I thought O my God hier kom kak.’ And if we do the same thing, if we just look at the fourth industrial revolution as ‘hier kom kak’ then we’re going to find it. But if we use it as an opportunity, as has happened in the aftermath … I mean the loss of value to this country … of Nene-gate … was R500 billion. We’ve done the numbers. Go and calculate them. That’s what we can quantify. The unquantifiable cost of that is … probably significantly higher than that. But we got a shock. We got a wake-up call. Nothing else was going to change this network of patronage as rapidly as that event. And the fourth industrial revolution when it’s overlaid onto this does require a new way of thinking. The good news is there are people in government who understand it, who’ve been researching it, who’ve been looking into it and are aware. The other good news is we only have 54 million people. Imagine you are India with a billion people. Imagine the issues that you have to deal with there. So, I’m hopeful, I really am hopeful. We just need to change our mind-sets and realise that we have … we have … you know, it’s like companies. I used to remember often reading … reading annual reports of companies and they’d say that people are our most important asset and then you’d go in there and they’ve got a human resources department. So you might be the most important asset but actually it’s just a bag of kilojoules that’s in the … it’s a resource. If humans … if people … are the most important asset of any society of any nation, which they are, give them the ability to actually fulfil their dreams and there hopes. At the moment I get this feeling we’re just not hopeful anymore. So it’s … embrace this new thing. But that takes leadership … and … you know… leadership and courage. And those are the kind of things that we’ve had in abundance in this country in years gone by. Who else has had a Mandela and a bishop … Archbishop Tutu … at the same time? Who has had even one of them? So, we’ve got it. It’s there. We just need to … and it’s going to happen …you know I’m a great believer that the ‘big boss’ he looks at this … and we make our plans … and he laughs … but he’s got something special for this country. Because this country was heading for that hier-kom-kak-moment very rapidly and we avoided it.
[DAVID O’SULLIVAN] So many times we stared at that hier-kom-kak-moment. Ladies and gentleman, I think we’ll wrap it up there. There will be an opportunity to do some networking, enjoy … I’m sure there’s little snacks and drinks outside. But please give a big round of applause to Alec Hogg.
Meet Ajay Dhani, BrightRock Processing Manager, whose formula for keeping cool under pressure is a handy lesson for us all
“Breathe,” says Ajay Dhani, Processing Manager at BrightRock, pausing to take a deep gulp of air before moving on to the next part of the mantra, “and listen.” Breathe, and listen.
It’s a lesson for living an even-tempered life, maintaining your equilibrium even when the tempests of change are swirling around you. Ajay learned the art while working in a call centre, at the foot of the ladder of the life insurance industry.
“When you’re dealing with a difficult customer,” he advises, “look at things from their point of view. Empathy is important. Don’t just listen, but listen completely.”
That ability to tune in to the other person’s wavelength has also helped to sharpen Ajay’s natural skills as a leader, going all the way back to his first job in a warehousing company in Durban, where he was quickly promoted to supervisor.
Growing up with his mom, dad, and three brothers in Newlands West, near Phoenix, Ajay originally planned to study electrical engineering, but family commitments drove him into the workplace when his father, a carpenter and shopfitter, fell seriously ill.
Later, Ajay got a taste for the restaurant trade as a “closing manager” at a steakhouse in Ushaka Marine World. He enjoyed leading a team and looking after customers, but the after-closing hours, extending until the early morning, took their toll, and he snapped up the opportunity to head inland and join his brothers in Johannesburg.
“It was a big change,” he says. “They sold it to me quite nicely, as a chance to try something new.” But the really big change came in 2013, with a move to a “fun, weird, unique and dynamic company”: BrightRock.
Ajay felt at home amongst the BrightRockers straight away, and today, as Processing Manager, he leads a team of 13, taking care of a range of vital functions from client contact to activation to financials. Through it all, shines the one bright ideal that defines his life as a team leader and team player.
“I’m basically all about delivering amazing customer service,” he says. “That means you must have the ability to inspire, you must have patience, you must be respectful, you must realise that each person is unique and different, and you have to be knowledgable on everything around you.”
Reflecting for a moment on life beyond the workplace, Ajay confesses: “I think I’ve turned out to be quite a boring guy”, which means catching up with music and movies, and spending quality time with his wife, Candice, a senior administrator at a cellphone company, and his family. His biggest Change Moment? That’s easy.
“It was when I got married,” he says. “I had to move from being a carefree guy to being a responsible human being. I had to learn to stop being a leader, and become a subordinate.” Remember, Ajay: breathe. And listen!
Rugby is like life in so many ways – when you’re playing such an odd-shaped ball, there’s no telling where it will land. No matter how good you are or how much you’ve practised! A lucky bounce of the ball, or one critical call, can swing the game for or against you. But Loving Change means not fearing these game-changing moments, instead embracing them and the opportunities they bring. In rugby and in life, Loving Change is all about Playing the bounce.
Play the Bounce. Play the moment. Love Change – and get the first-ever needs-matched life insurance that changes as your life changes.
Johannesburg, 26 January 2016 – Fast-growing life insurance player BrightRock today announced the signing of a three-year Official Associate Sponsorship agreement with the DHL Stormers and DHL Western Province, effective from January 2016.
The deal signals a major milestone for the company, which launched its unique needs-matched life insurance offering in 2012. BrightRock has rapidly established itself as one of the fastest-growing players in the intermediated individual life market in South Africa. The company recently announced that premium growth had grown by 80% year on year, with cover in force now exceeding the R114 billion mark and claims to the value of over R155 million paid to date. According to BrightRock executive director Suzanne Stevens, the partnership reflects the company’s strong performance to date and will help fuel the growing awareness of its brand among consumers in its target market.
Stevens commented: “We’re thrilled to be involved with two of South Africa’s most beloved rugby properties and helping to bring top-class rugby action to such a large, diverse and passionate fan base across South Africa”.
BrightRock’s involvement as a business sponsor for the DHL Western Province and DHL Stormers teams will be visible in stadium, with its logo appearing on the back of all match-day jerseys. “It’s a privilege to join head sponsor DHL and associate sponsors Land Rover and Adidas on the blue-and-white jersey”.
According to Stevens, BrightRock sees the partnership as a perfect platform for its “Love Change” brand philosophy, because of the ever-changing, unpredictable nature of the game. She says that the concept of change is central to the BrightRock needs-matched insurance offering, which is dynamically able to change with clients as their needs change over their lifetime.
“Rugby, like life, is a game where the unpredictable is always a play away and can challenge even the best skill and preparation. A lucky bounce of the ball, or one critical call, can swing the game for or against you. We believe in not fearing these game-changing moments, but embracing them. By welcoming Change – in rugby or in life – we’re able to find the opportunities that it presents.”
“Our product is designed to precisely match your risk needs upfront and then it can change with you as your financial interests shift at major, life changing moments. Rugby with its odd-shaped ball that delivers that unpredictable bounce, gives us a platform to highlight the unique value BrightRock’s needs-matched life insurance has to offer with its world-first ability to adapt to our clients’ dynamic, changing lives.”
President of the Western Province Rugby Football Union Mr Thelo Wakefield added: “We are very excited to welcome BrightRock into the Western Province Rugby family. We look forward to working closely with their team and providing BrightRock with value whilst drawing on their expertise to grow and develop the game and our brands for all.”
Click here to view the full press release.
BrightRock was started with the goal of creating insurance products that truly meets consumers’ and financial advisers’ needs. It offers individualised, needs-matched life insurance cover that’s built around your specific needs at the outset, and is specially designed to change with you as your needs change. And because BrightRock’s cover is flexible and changes appropriately when your needs change, it’s more efficient. This means both your cover and your premiums remain relevant, and more affordable, throughout your life.
BrightRock figures at 31 December 2015
Season Two of The Dan Nicholl Show airs on SuperSport 1 from 4 November.
After a very successful first season, celebrity watchers and dedicated sports fans will again be pre-scheduling their Wednesday night viewing, as The Dan Nicholl Show returns to our screens. Hosted by renowned broadcaster Dan Nicholl, season two of the popular sports and lifestyle talk show will premiere on our screens from 4 November 2015, at 19h00 on SuperSport 1 in a brand new, hour-long format.
As with season one, each week promises a trio of guests from the entertainment, lifestyle and sporting worlds who will join Nicholl in-studio, for light-hearted banter and tongue-in-cheek conversation.
The show debuts with a stellar line-up and promises to keep audiences entertained and enthralled throughout this new season. With a live studio audience cheering on the guests each week, the show largely focuses on familiar South African faces, and their stories – and as always, the conversation will touch on the topic of Change.
“We had celebrities in studios having a laugh, shoots in exotic locations, Cameron van der Burgh and me taking our shirts off – it was quite a full first season!” said Nicholl. “To have BrightRock and SuperSport on board again, and for a longer show, is a massive endorsement, and I’m extremely excited about season two.”
BrightRock’s Suzanne Stevens echoes the thought: “Audiences have loved hearing the behind-the-scenes stories of how their icons have dealt with the Change Moments in their lives and careers.”
The show has been extended from 30 minutes to a full hour, giving Dan the chance to expand his interviews, and pack even more entertainment into the format.
* This article was originally published in FA News.
As BrightRock reaches a major milestone of cover in force, just three years after launch, here’s what we’re doing to change the rules of the game and help meet your needs for life
Just over three years ago, a bright new star blazed a trail across the landscape of South African insurance. BrightRock, built on the unique premise of insurance that matches your individual needs, in line with the changes at various key stages of your life.
“Love Change!” said BrightRock, inviting the industry and the public to take a bold new look at the way insurance works, and how it can work better for you.
Proof that the message hit home, is the major milestone of more than R100-billion in cover in force achieved by BrightRock this year, confirming its status as an emerging leader in the South African individual risk market.
For Schalk Malan, Executive Director at BrightRock, the driving force behind this exponential growth has been the company’s “needs-matched, client-centric approach” to insurance cover.
“While the South African insurance industry as a whole has remained stagnant over the past year,” says Schalk, “our positive growth trajectory has seen an 89 per cent increase in year-on-year gross premiums billed.”
BrightRock has also paid out more than R125-million in claims since launching in March 2012, reflecting a philosophy of comprehensive and certain cover. Claims certainty is a central principle of BrightRock’s needs-matched approach, says Schalk.
“We are paying claims that traditionally would not have been paid, or been paid at a lower level. We’ve found that our transparency, objectivity and clearly stated criteria have gone a long way to giving clients assurance around exactly how their claim will be assessed and paid.”
The BrightRock philosophy has proved so successful, that other insurers are slowly integrating a client-centric approach into their product offerings.
But as a company built on a love of change, BrightRock keeps on changing, and the blazing of new trails continues with the launch of key product enhancements to the market.
The first of these is the temporary expenses cover, giving policyholders guaranteed pay-outs for 37 conditions. In addition, there is an extensive list of more serious conditions with a much longer specified payment period.
“Clients who do not have permanent expenses cover can now claim one to three months’ cover if they meet our definition, regardless of whether they are booked off work,” explains Schalk.
Next up from BrightRock is the Job Fitness Test, which aims to give clients transparency upfront, and even more certainty at claim stage. When it comes to permanent expenses cover, BrightRock provides cover for more than 100 conditions, regardless of the impact of a client’s injury or illness on their occupation.
The Personal Job Fitness Test enriches this cover by offering an “own specific occupational underpin”, over and above these conditions.
As Schalk explains, occupational underpins have traditionally been subjective, leading to considerable uncertainty for clients. The new Job Fitness Test uses a points-based system to evaluate a client’s ability to do the work that someone in their stated occupation would typically do.
It is made up of a series of physical and cognitive assessments done by independent medical specialists. The assessment criteria are disclosed upfront to ensure transparency, so clients know exactly how their claim will be assessed, explains Malan.
Trauma cover also comes under the spotlight of change, with the development of a groundbreaking product enhancement called the Trauma Impact Quotient, or Trauma IQ assessment. This is a market-first for the insurance industry, with a patent for the product currently pending.
Where clients suffer a trauma or accident that would traditionally be overlooked, BrightRock’s unique Trauma IQ assessment will factor in how severe the impact of the injury is on the client. The assessment examines nine factors that contribute to the financial impact of a traumatic injury. These include the length of time of surgery and the degree of rehabilitation undergone.
“This therefore significantly expands a client’s assessment spectrum and likelihood of payout,” says Schalk.
As these enhancements prove, BrightRock is putting down strong foundations for growth, in an industry where change is vital to life. As Schalk puts it, BrightRock is changing the rules of the game, and the winner, for life, is you!
Trail-blazing insurance player BrightRock recently achieved a major milestone when its cover in force exceeded the R100 billion mark (as at 30 September). This was achieved in just over three years from its market entry, confirming BrightRock’s status as South Africa’s fastest growing provider in the intermediated individual risk market.
“We believe that our needs-matched, client-centric approach to insurance cover has been the driving force behind our exponential growth,” explains Schalk Malan, Executive Director at BrightRock. “While the South African insurance industry as a whole has remained stagnant over the past year, our positive growth trajectory has seen an 89% increase in year-on-year gross premiums billed.”
The company has also paid out more than R125 million in claims since it started operating in March 2012, reflecting its philosophy of comprehensive and certain cover.
“Claims certainty is a central principle of our needs-matched approach. We’re proudly paying claims that traditionally would not have been paid or been paid at a lower level. We’ve found that our transparency, objectivity and clear criteria have gone a long way to give clients peace of mind about how their claim will be assessed and paid,” emphasises Malan.
“The success of this approach is clear from our strong new business growth, and our competitors have definitely taken note. One or two have recently introduced benefits that seek to emulate some of the features we introduced to the market, but none have been able to replicate the flexibility, efficiency and claims-certainty that BrightRock’s unique needs-matched product offers.”
BrightRock is set to build on its strong, differentiated product platform, with several new product enhancements, effective from 1 November 2015.
“Again, with the new features we’ve introduced, our focus has been on increasing claims certainty and clarity for our clients, by expanding the spectrum of claims we cover,” notes Malan.
This has no impact on the client’s additional expenses cover, which fully reinstates immediately. This market first for the insurance industry is currently pending patent registration locally with international patent applications to follow. “BrightRock policyholders without a doubt enjoy the most comprehensive cover for additional expenses available in the market today” says Malan;
“The Personal Job Fitness Test has always provided an occupational underpin to the clinical criteria, providing pay-outs where a client is unable to work in their own specific occupation because of an illness or injury. BrightRock now also offers an additional, stated occupational underpin in the form of the new Job Fitness Test.” Malan says this transparent, objective test uses a points-based system to evaluate a client’s ability to do the work that someone in their stated occupation would typically do. “The assessment criteria are disclosed upfront to ensure transparency – a market first – so clients know from the get-go exactly how their claim will be assessed,” explains Malan. As an example, an accountant who loses the ability to speak (severe inability to produce or comprehend language symbols) would qualify for a 100% pay-out.
The updates on BrightRock’s performance and the launch of these enhancements formed the basis for a recent nationwide series of update sessions attended by over 1 000 financial advisers, who have welcomed the increased certainty BrightRock has created for their clients.
“In the past three years, BrightRock has laid strong foundations for our future growth, and we’re excited to see the impact our product thinking has had on the market. We are looking forward to further building on these successes through the new product features , which will come online on 1 November 2015 and, we hope, will prove to be another game-changer for our industry,” concludes Malan.
Policyholders who take out lump-sum disability cover cancel much of their cover before they reach retirement, which means that they will have paid more for their cover from the date on which their policy started than was necessary, life assurance company BrightRock says.
By Mark Bechard.
BrightRock has designed its cover to be flexible, to match your changing needs more closely and avoid what it calls “wasted premiums”.
Schalk Malan, BrightRock’s product actuary and director, says life companies’ claims statistics show that, as policyholders’ need for lump-sum disability cover decreases as they approach retirement, they are cancelling large amounts of cover.
Despite the need for cover decreasing, the risk of disability when you are 60 is nearly nine times higher than it is when you are 40, Malan says.
But claims statistics for 2013 show that claims paid from lump-sum disability cover did not increase between the ages of 40 and 60; instead, claims by policyholders over the age of 50 were 85 to 95 percent lower than expected. Malan says the explanation for this is that policyholders had significantly reduced their cover in line with their reduced needs.
The reduction in lump-sum disability cover later in life has been confirmed by studies by True South Actuaries and Consultants, he says.
Most policyholders use lump-sum disability policies to cover needs that exist for a specific term and decrease over this period – what is known as “decreasing term” needs, Malan says. Cover that decreases over the term of the policy is cheaper than cover that is priced to increase for the full term, which could be until you retire or your entire life, because the financial risk to the life assurer decreases over time.
Ideally, cover for a home loan, or to finance your children’s education, or to replace an income, should be decreasing term, because the loan reduces as you pay it off, the total cost of education will decrease as your children grow up, and the number of pay cheques you would need to replace your income if you were disabled and unable to work decreases as you approach retirement.
If, for example, you take out lump-sum disability cover of R1 million at the age of 30, it is likely to include an annual increase to take account of inflation. As a result, the cover will increase, rather than decrease, as you age, despite the fact that your need for the lump sum will probably decrease over time. As you get older and approach retirement, your broker or financial adviser is likely to advise you to cancel some of the cover. As the cancelled premiums were priced for the full term for which could have had the cover, the portion of what you have paid is wasted.
If, later in life, you reduce your lump-sum disability cover and re-allocate the premiums to, for example, critical illness cover, you may find that you are less insurable and will pay more for the cover than if you had taken it out when you were younger.
On the other hand, if you had bought cover that was structured more efficiently from the start, you could have paid lower premiums, Malan says.
* This article and image were originally published in Personal Finance on 19 September 2015.
Originally published in Insurance Times and Investments, 16 April 2015
Six things to consider
Whether you’re getting married, divorced, become a parent, property owner, landed the job of your dreams or starting your dream business, life happens. With these changes, you’ll face varying degrees of financial responsibility. That’s why it’s important to keep tabs on your finances by seeking good, trustworthy financial advice. Sean Hanlon, Executive Director at BrightRock, outlines the following points people should consider in ensuring that they receive sound financial advice:
Here are six things to consider:
1. The sooner you get advice, the better
Many people postpone buying life insurance or starting long-term savings until they have children or reach a certain age. Bear in mind, the benefits of the compounded interest earned on your savings will be so much greater the sooner you start. This in turn will reduce the pressure to save aggressively because of your family or pending retirement. And even if you have no dependants, disability cover is a must for most of us. If you’re earning an income, it’s important to make sure you’ll still be able to pay your own way if anything should happen to you.
2. Shop for a good financial adviser
This shouldn’t be any different from ‘shopping’ for a good GP or dentist. A good financial planner is supposed to understand your financial needs, based on your income, assets, debt, expenses and existing insurance cover. He or she should help you set financial goals and work towards them, help you manage your financial affairs and not just sell you insurance products. Ask your friends and family for recommendations, check them out on Google or LinkedIn and look if they’re listed on the websites of the Financial Services Board (www.fsb.co.za) or Financial Planning Institute (www.fpi.co.za) websites. Remember the choice is always yours!
3. Your financial adviser should be independent
If your financial adviser is linked to a specific insurance or investment company, the advice you receive will tend to be biased towards the company in question, which might not always be in your best interest. Advisers are required to declare their affiliation with any of these companies to you upfront – so make sure you ask. A good, independent financial planner is more likely to compare different investment and insurance products to find options that meet your specific needs.
4. Seek transparency
The commission and fees of financial advisers are regulated. Advisers are legally required to disclose their remuneration to you. If the adviser asks a consultation fee, the time the adviser spends with you should justify this expense leaving you with a variety of options that meet your needs, and are explained to you in detail.
5. Qualifications are important
All financial advisers must be registered with the Financial Services Board (FSB). Certified Financial Planners (CFPs) meet stringent professional standards and belong to a professional body, the Financial Planning Institute (FPI). Only 4 600 of the 100 000 financial advisers registered with the FSB are Certified Financial Planners. Brokers and advisers are licensed according to their qualifications and experience for the type of service and products they may offer – ask your financial adviser to explain his background and qualifications to you.
6. What are the optional extras?
Some advisers are Jacks of all Trades, and offer assistance with tax, estates and a variety of lesser-known or complicated investments. Other advisers are specialists, but may have comprehensive support networks offering these additional services. Do make sure what you’re letting yourself in for in terms of extra bells and whistles. You don’t want to get charged for someone else’s time and expertise unless you explicitly seek it.
A behind-the-scenes look at how we’ve been living up to our claims, by paying your claims at BrightRock
At BrightRock, the centre of our universe is a very important individual whose needs in life light our way. That individual, of course, is you.
As your life changes, through all the stages of raising a family, building a career, and putting down roots, so do your needs change, and that’s why we offer the first-ever life insurance that changes with you.
Our unique needs-matched life insurance is different from other products in the market, and not just because it can save you up to 30% on your premiums from day one.
It’s structured to allow you and your financial adviser to work together to create the life insurance solution that works just for you, as and when you need it.
But how do we live up to our claim, when it comes to paying out claims? That’s the real test, and so we’d like to take you behind the scenes and show you some of the data from our claims department.
Since we made our debut in 2012, we’ve seen a positive response from the market, with strong new business growth as more and more financial advisers and clients embrace our unique new product technology.
We’re happy to say that we’ve paid 95% of all valid claims received to date. The average age of clients who claimed is 44 years, and 74% of claims have been paid out to claimants who were non-smokers.
The majority of our claims, 45%, have been paid for temporary claims, and our biggest single payout to date has been R17,5-million.
Take a look at these statistics, in our bright infographic form, and let us know if you have any questions about our products and policies. It’s thanks to you, that we’re in business for life!
Distribution of claims paid across the BrightRock grid
Below is a representation, by number of claims, of where on the BrightRock grid our claims are being paid from.
It’s a proud moment for any parent when a child stands ready, face beaming, uniform neatly-pressed, backpack in hand, to begin one of life’s great adventures on the first day of school.
Blink, and that same child is standing on a stage, wearing mortar board and gown, to accept a hard-won scroll on Graduation Day at university.
The years flash by in a parade of academic and sporting achievements, tempered by the nagging reminders that a good education costs not just time, but money. That’s one of the main reasons why parents take out life insurance – to safeguard their children’s future when they’re no longer around to provide.
If you’re a BrightRock policyholder, you can choose a unique needs-matched solution that will exactly meet your childcare needs, should you suffer an illness, injury or die before your children reach financial independence.
We understand that childcare costs can vary considerably per child, even within the same family.
This is why, with our childcare cover, policyholders can customise the cover for each child, providing not just for school or tuition fees, but for extra murals, sporting equipment, tours, clothing, pocket money, future costs of a car, cell phone bills, travel, holidays and even groceries.
And when your bright achiever makes that big leap from high school to university, you’re covered for the jump in costs by our unique tertiary education step-up. This allows parents to provide for an automatic increase – of 0%, 50%, 200% or 300% – both in cover (pre-claim) and in pay-outs (post-claim) for the education needs of a specific child at the end of the year in which that child reaches the age of 18 years.
Once chosen, the step-up in cover is automatic and requires no underwriting.
Your premiums will be priced not to spike at this age, but will increase only by the amount you initially selected. That means additional cover, without any nasty surprises.
With tertiary education step-up from BrightRock, you’ll be able to provide for the expected increase in tuition fees as well as additional costs, such as your child’s transport and accommodation at university. By taking into account the portion of household expenses linked to each child, and adding this to the childcare needs cover, BrightRock is able to offer parents cover that is more appropriate and tailored to their family’s needs.
And in an industry first from BrightRock, you’ll be able to choose, at claims stage, whether the payout in respect of childcare needs should be made as a once off lump-sum, or a series of recurring monthly pay-outs.
This applies to cover for an illness or injury with a financial impact that is either permanent or leads to the death of the insured parent.
With your childcare needs in mind, you’ll be able to state your own cover amount, and the benefits can also be used for whatever you see fit at claims stage. Benefits can be paid to the beneficiaries you nominate, rather than only to an academic institution.
The pay-outs can continue until the specific age at which the parents expect that child to be financially independent, rather than the standard age of 18 or 21 years.
Our more efficiently-priced cover provides better value and frees up funds for parents to buy more cover where it’s needed.
On average, BrightRock clients save 30% on their monthly premiums.
On top of that, when the childcare cover is no longer required — for example when your child becomes financially independent — you can choose to convert childcare premiums to premiums for other needs.
Where clients have insured more than R1 500 for two or more events, and have cover for additional expenses, their children automatically qualify for additional expense needs cover. This cover is available from birth, and applies to the more than 300 additional expenses clinical conditions, as well as 12 child-specific conditions.
How it works – a case in point
A BrightRock client, a consultant from Nelspruit, took out his BrightRock policy in May 2013 and saved 28% on his monthly premiums thanks to our needs-matched efficiency. His key reason for getting cover was to ensure his wife and two children would be taken care of if he were to die. Just four months later, he suffered a severe heart attach at the age of 51 years and passed away. His family decided to receive their pay-out for childcare needs as a regular monthly amount. By choosing to receive these recurring pay-outs rather than the lump sum, the family is assured of a monthly pay-out of R5620 for each child. This monthly amount grows every year, as shown in the graphs below, and will double after the children have matriculated, thanks to tertiary step-up.
For more information about BrightRock’s cover for child additional expense needs, please consult your BrightRock financial adviser.
31 October 2014, Money Marketing
The Draft Taxation Laws Amendment Bill announced last year is expected to simplify tax benefits for life insurance premiums.
While this should benefit policyholders in the long term, many advisers will need to review their IP contracts to check for over-insurance during the transition to the new, simpler life insurance tax regime.
As things currently stand, premiums for recurring income protection insurance policies are allowed as a tax deduction. The premiums for lump sum life cover and permanent disability payments, whether temporary or permanent, are non-deductible. These differing tax treatments have been known to cause confusion for policyholders, adding complexity to the advice task.
In light of this inconsistency in the legislation, Treasury has proposed that the same principles that apply to lump sums (non-deductibility of premiums and tax-free pay-outs) be extended to recurring income protection policies too. This will ensure that there is uniformity in the treatment of policies that relate to personal cover for individuals.
It will make things significantly simpler for advisers and clients, and reduce risk and uncertainty. It will make things significantly simpler for advisers and clients, and reduce risk and uncertainty. Previously, because financial advisers had no way of knowing the income tax table that would apply to a specific client at the time of a claim, at policy inception advisers had to guess by what amount to increase the client’s cover to make provision for tax deductions. When there is no income tax liability on pay-outs, clients and advisers have the certainty of knowing that the cover amount they bought is what will be paid out and what they’ll receive at claim-stage.
Once the Amendment Bill is passed through, as expected, in parliament in March next year 2015, insurance products will be expected to adjust accordingly.
Because savvy advisers and their clients would have upped their sum insured for recurring income pay-outs to make provision for taxation of benefits, many policyholders will in effect be over-insured once the new regime applies. Where the insured amount exceeds the client’s take home (after tax) pay, cover will need to be reduced. Fortunately, recent innovations in the structure of life insurance products mean that not all policyholders and financial advisers will face these headaches.
Two years ago, BrightRock launched a ‘best of both worlds’ feature – that allows policyholders to change their choice of a lump-sum pay-out to a recurring income pay-out at claim stage, with no impact on taxability of benefits (the pay-out, whether lump sum or recurring does not attract income tax). The pay-out with this option capitalises the expected future income into a once-off lump-sum and is an industry world-first. It is particularly beneficial where a client`s long term prognosis (only known at claims stage) is poor. Compare the value it offers a 45-year old, who becomes disabled and has a poor prognosis. This client will enjoy a much greater benefit from an up-front lump-sum of R6 million, versus receiving just R35 000 per month for a few months. Making this choice at claims stage ensures the client gets the ‘best of both worlds’.
For policyholders who’ve taken advantage of this new thinking, the product is already suited to the changes in tax treatment of life insurance, and no adjustments will need to be made, helping to ensure their life insurance cover is already tax-change-ready.
Advisers in the rest of the market will need to check each income protection client’s cover, and review all the income protection products they’ve recommended, and make downward cover adjustments to ensure their clients aren’t over-insured.
The timing of this reduction is also important as it could cause the client to be exposed. Reducing the cover before the legislation change means that if the client claims between the cover reduction date and the legislation change, their (lower) pay-out may still be taxed, all the way to retirement. Waiting to after the change means that premium is effectively wasted, as if there is a claim, it will be reduced due to over-insurance. The reduction in cover will also require time and effort from the adviser and may incur a commission claw back for newer cases. – By Schalk Malan, Director, BrightRock
(This article was originally published in Money Marketing on 31 October 2014.)
29 June 2014. Moneyweb.
JOHANNESBURG – You might be paying too much money for life insurance cover that you don’t in fact need, according to two-year old life company BrightRock.
BrightRock offers what it calls “needs-matched life insurance”. It says it can save you on average 30% on premiums by crafting your policy to change as your life changes.
Traditional life insurance policies, says BrightRock, are generally priced for the maximum term so that built into the price of each monthly premium is the assumption that you will have this cover for your entire life. These policies are designed so that you are paying for “whole of life” cover that you might actually only need for a limited period or that actually needs to reduce, rather than grow over time.
For example, if you have three school-going children and are paying off a bond, you need a significant amount of life insurance and income protection cover. However, if your kids will only be dependent on you for another 10 years and your bond will be paid off in the next 15 years, BrightRock argues that there’s no reason why you should be paying from day one for R5 million “whole of life” insurance cover, when you may in fact only need R4 million worth of life insurance for the next 15 years (to cover kids and your bond) and thereafter R1 million will suffice.
BrightRock says it prices policies accordingly from day one so that it charges you only for the cover you actually need over your lifetime, allowing you to tweak the policies in order to reflect changes in your circumstances. Although traditional life insurance policies allow you to service your cover down when you no longer need as much of it, BrightRock says that because of the way they are priced upfront you would have already wasted money on the higher premiums paid up until that point.
Independent financial advisor, Terence Tobin, says there is no single perfect product for every client, which is why it’s important to consult a financial planner. Asked to comment on BrightRock’s offering, Tobin says BrightRock is the first life company that allows you to reduce the life cover you have on your bond as you make monthly payments, so that you’re not paying for R1 million worth of bond cover for 20 years when you need progressively less each year.
“Once you no longer need that extra life cover to pay your bond off, you can plough that premium into buying additional illness and disability cover with limited underwriting,” Tobin adds. “In other words, you pay only for the cover you need and cover can be moved around when and where you need it.”
He adds that income protection payouts are based on medical criteria, as opposed to whether you can or cannot still do your job. In other words, even if you are an accountant and can still earn the exact same income after suffering paralysis from the waist down in a car accident, BrightRock will still pay the income protection claim. A number of other life insurers insist that you prove loss of income, often called Own Occupational Disability.
Tobin says clients can also decide at claims stage whether they would like their disability payout as a lump sum payment, on a monthly basis, or a combination of the two. Once you’ve decided on the payout structure that decision is binding.
Think of a policy where there is income protection and critical illness cover for a 26-year old female. An amount of R4 million reflects the total that monthly income payments of R16 695 amount to over her insured lifetime (age 65), taking into account annual inflationary increases. If she suffers a permanent injury (even if she is still able to work), she can elect to drawdown around R16 600 monthly (growing annually by inflation), take the lump sum amount of some R4 million, or select a combination of the two. For example, taking R2 million upfront and the rest as monthly payments.
The monthly premium on this policy is R171, compared with R192 for a similar policy with a competitor (excluding the option of the large lump sum income protection payout). According to Tobin, due to the way premiums on the competitor’s life insurance policy increase (aggressively compounding as each year goes by), the premiums work out to be more expensive in the long run, too. BrightRock allows clients to decide by what percentage they would like their premiums to increase each year.
“BrightRock has done what the market needed, in the same way that Discovery did some 14 years ago,” Tobin comments. He notes that BrightRock is generally more expensive than competitors on quotes for high-risk occupations, such as police officers and that it does not cover HIV positive individuals.
Francois de Bruyn, head of product development at Sanlam Individual Life, points out that life’s changes are often unpredictable. “The truth is that needs for different individuals do not change in a predictable pattern. People plan to pay off their bond in 20 years, but the unforeseen presents circumstances that prompt many to deviate from their well-intended plans,” De Bruyn says. “One of the risks with decreasing insurance is that someone might need cover at a later point in life and might not be able to get the same kind of insurance at that time due to changes in health status, for example.
“BrightRock makes much of the flexibility of its product offering, as compared to the ‘fixed lump sum for specific events approach’. However, it may be difficult to predict what a client’s future needs will be. Managing a rolled single sum as opposed to little sums is simpler and more user friendly,” comments De Bruyn.
Head of risk product development at Liberty, Ryan Switala adds that in many circumstances, cover that a person has in place meets a different need over time. “Even though financial needs change over time, existing insurance in place can be used to meet those different needs,” Switala maintains. In other words, if you have more traditional, lump sum cover, you as a client can elect how you would use that lump sum in the event of disability or illness.
Old Mutual risk specialist, Wyno Strydom says that term cover and whole of life cover can be used for different purposes. “Whereas a term cover option might be suitable for specific needs like a 20-year bond, a whole of life option should be considered for an estate plan,” he says.
All the competitors agree that regularly reviewing your financial plan and life cover needs with an advisor is the best way to ensure you have the right cover.
* This article was originally published on Moneyweb on 29 July 2014. You can read the original version here.
6 June 2014. Money Marketing.
A mere two years ago BrightRock entered the South African life insurance market. Since then, consumers, financial advisers and the industry as a whole have taken notice of – and responded to – its fresh approach.
Since opening for new business in April 2012, BrightRock has written future premiums of R811 million in total, with cover in-force equating to around R51 billion. Nationwide, more than 2 700 independent financial advisers have signed distribution contracts with BrightRock to date. Month-on-month, the number of activated policies is growing by an average of around 20%.
However, the true measure of a life insurance product’s value is not in its sales but in its performance at claim-stage. Despite modest claims volumes, a function of its relatively recent market entry, BrightRock has already made a number of substantial pay-outs – the largest claim paid to date was a death claim of R16 million.
Says BrightRock’s executive director and main product architect, Schalk Malan: “The industry has sat up and taken notice of us, and we’ve seen some product developments being launched in response, especially in the income protection space. The broker market’s response has been tremendously positive and the client take-up to date has been exceptional.”
BrightRock’s ‘needs-matched’ product design has given consumers the power to co-create a life insurance product suited to their exact needs with their financial adviser. It’s the life insurance equivalent of 3D printing technology, enabling a far greater degree of flexibility and customisation than traditional risk protection products.
BrightRock’s focus is on accurately meeting the policyholders’ needs – not just at the time of sale, but also post-purchase, to ensure the risk solution keeps pace with policyholders’ changing needs.
The result is that policyholders enjoy better value and greater long-term certainty. Because each component of the client’s cover tracks the need so precisely, cover is priced far more accurately and efficiently, enabling an average premium saving of 30% from day one.
Malan says that the tremendous demand for cover created by the huge insurance gap (of R24 trillion, according to the latest ASISA industry study) in South Africa, presents a significant opportunity for BrightRock “That’s why we started this business. We knew change was needed and believed we could deliver the kind of consumer-centric product thinking required to help close the gap.”
Malan says he and his fellow founders – BrightRock is headed up by Malan and three other founding executive directors, Sean Hanlon, Leopold Malan and Suzanne Stevens – are proud of what’s been achieved to date.
“In such a competitive, well-developed insurance market, there are no overnight successes. It takes effort and time for a start-up life insurance enterprise with a totally new technology to establish a strong presence in the market. We’re excited about what the future holds.”
Malan received the 2013 Cover Excellence Award in recognition of BrightRock’s product innovation.
Product features unique to BrightRock’s needs-matched life cover
· Premium savings of 30% on average, from day one. Because a policyholder’s cover is created to specifically meet their needs for life, there’s no waste in a BrightRock policy. This makes it more efficient and affordable than traditional products in the market;
· Needs-matched cover, now and over time. BrightRock’s needs-matched life insurance is the only life cover in the market that precisely tracks the behaviour, growth and duration of each individual financial need over time.
· Cover that changes as your life changes. It is easy for BrightRock policyholders to make changes to their life cover when their needs change, thanks to the following features:
o With the cover conversion facility, BrightRock policyholders can use their existing premiums to cover a new need or top up cover on an existing need (up to a maximum of R7,5 million), free of medical tests;
o With the extra cover buy-up facility; BrightRock policyholders can buy more cover later (up to a maximum of R7,5 million), with only an HIV test;
· World-first flexibility at claim stage. Only BrightRock gives policyholders the ability to change their choice of a lump-sum to a recurring pay-out (or a combination of the two) at claim-stage for their income protection needs on permanent illness or injury and on death. And for the additional expense needs following an illness or injury, BrightRock policyholders can, based on their prognosis, choose either a lump-sum or lump-sum plus recurring pay-outs, increasing pay-out to 200% per body system for some conditions.
· Market-leading claims definitions. BrightRock uses objective medical criteria based on international clinical best practice guidelines to assess illness and injury claims, removing many of the traditional barriers to claim. The clinical criteria are underpinned by the Personal Job Fitness Test, ensuring that policyholders can get the benefit, where appropriate, of a pay-out based on their inability to work should they fall short of meeting the medical definition for a claim.
6 November 2014. Cover Magazine.
BrightRock has recently released updated figures on its performance in the individual life insurance market.
Since opening for new business in April 2012, it has already written future premiums of just over R1 billion (R1 034 million, as at 30 September) in total, with cover in-force equating to around R70 billion. Nationwide, more than 2 700 independent financial advisers have signed distribution contracts with BrightRock to date. Month-on-month, the number of activated policies is growing by an average of over 15%.
According to BrightRock, it’s ‘needs-matched’ product design has given clients the power to co-create life insurance products suited to their needs with their financial adviser.
Schalk Malan, Executive Director at BrightRock and the main architect of the company’s unique needs-matched product structure, commented on the achievement. Malan received the 2013 Cover Excellence Award in recognition of BrightRock’s product innovation.
“BrightRock’s CAR (capital adequacy ratio) cover is at a healthy 2.8 times the required solvency level, ensuring the long-term sustainability of its risk book. Year on year, the value of in-force premiums has doubled, albeit off a low base, a positive indicator for future profitability.
“BrightRock has also seen a positive experience variance in terms of the company’s embedded value relative to its projections, this is largely attributable to better than expected investment returns. In terms of overall market share, and taking into account the split between distribution by Independent Financial Advisers (IFAs) and tied agency distribution in the industry, it is estimated that BrightRock accounts for between 8% to 10% of new life insurance business written by IFAs in South Africa.”
“… These indicators are all signs of the company’s positive growth in a competitive market,” concluded Malan.
However, Malan again emphasised that the true measure of a life insurance product’s value is not in its sales but in its performance at claim-stage. Despite modest claims volumes, a function of its relatively recent market entry, BrightRock has already made a number of substantial pay-outs – the largest claim paid to date was a death claim of R16 million.
Malan says that the tremendous demand for cover created by the huge insurance gap in South Africa (of R24 trillion, according to the latest ASISA industry study), presents a significant opportunity for BrightRock:
“That’s why we started this business. We knew change was needed and believed we could deliver the kind of consumer-centric product thinking required to help close the gap.”
Malan says he and his fellow founders – fellow executive BrightRock directors Sean Hanlon, Leopold Malan and Suzanne Stevens – are proud of what’s been achieved to date.
“In such a competitive, well-developed insurance market, we are pleased with our growth trajectory and the continued progress we have made on the R&D front, which ensures we are able to meet consumers’ changing needs through highly-efficient, relevant life products. We are positive about our future prospects and our ability to establish a strong presence in the market going forward,” added Malan. – By Katya Smith
(This article was originally published on the Cover Magazine website on 6 November 2014.)
28 October 2014. FA News.
October is a time when pink ribbons and “how-to” articles remind women of the need to conduct regular self-examinations. When it comes to breast cancer and its costs, a similar dictum applies – it’s all about being prepared.
Breast cancer facts
Breast cancer is the most common cancer in women, and in South Africa, statistics show that 1 in 29  women are diagnosed with breast cancer in their lifetime. A man’s chance of getting breast cancer is about 100 times lower than that of a woman.
It’s also one of the most preventable and treatable cancers. If detected early (at stage 0 or stage 1), five-year survival rates* are around 80% – 90%. At stage III, the survival rate is between 40% – 60%. At stage IV, this dwindles to only 15%.  Obesity, poor nutrition, sedentary lifestyles, alcohol use, smoking and stress can put women at higher risk of developing breast cancer. The risk also increases significantly with age – the majority of cases are diagnosed in women over the age of 60 years.
Thanks to Angelina Jolie, there is now also more awareness of the role of family history, a major contributing factor to women’s breast cancer risk. A mastectomy is an extreme way of reducing one’s risk of getting breast cancer for women with a family history of very aggressive breast cancer. Angelina Jolie, who tested positive for the BRCA1 breast cancer gene, is said to have reduced her risk of developing breast cancer from 87 percent to 5 percent by having a double mastectomy.
Fortunately, regular screening can lead to early detection. Women of all ages should do regular self-examination of their breasts . However, women over the age of 40 are advised to have mammogram annually.
* The five-year survival rate relates to how many women diagnosed with breast cancer are still alive five years after their diagnosis.
What about dealing with breast cancer’s costs?
The cost of breast cancer treatment varies depending on the stage and aggression of the cancer. Treatment could include surgery, chemotherapy and radiation therapy. As you may be aware, medical schemes are compelled to provide coverage for treatable breast cancer (subject to certain maximum limits), as it’s one of the Prescribed Minimum Benefits. The level of coverage is dependent on the medical aid option selected. Many medical aids offer coverage for related expenses like the cost of a wig during chemotherapy, the cost of breast prostheses and, in some cases, the cost of reconstructive surgery after a mastectomy. However, where women opt for treatment with some of the more expensive biological drugs or any form of experimental treatment, medical schemes may decline funding.
Besides the costs of treatment covered by medical aid, there may be out-of-pocket medical expenses or additional costs that don’t relate directly to medical treatment. For example, the cost of hiring a driver or aftercare for children while the sufferer is undergoing treatment.
These unforeseen additional expenses that may result because of serious diseases like cancer costs are covered by dread disease or critical illness cover. In advising clients, it’s important to make a clear distinction for client between their dread disease cover versus their disability and death cover. Disability cover aims to provide the client or their family with an income if they cannot work because of an illness or injury. Death cover provides a pay-out to cover costs like funeral expenses, estate duty and to provide an income for dependants after the client’s death.
What you need to be aware of when it comes to your clients’ cover for additional expense needs
Here are some tips on what to look out for when it comes to advising clients on cover for additional expenses cover for the costs of serious illnesses like breast cancer.
Standalone cover: Many providers will reduce a policyholder’s cover for death or disability when they receive a pay-out under their critical illness benefit, or vice versa. As the different cover components are intended to meet very distinct financial needs, this could leave the client exposed. Standalone cover for additional expense needs mitigates this risk;
Coverage for preventive surgery or early detection: Most insurance providers will pay clients out for the later stages of cancer. Some providers sell separate products that provide coverage at the earliest stages, stage 0 or stage 1 – but these may come at an additional cost. And some providers include coverage for the earlier stages of breast cancer as part of their standard critical illness product, at no additional cost – or will even pay the client out if, like Angelina Jolie, a gene test has shown that they’re at high risk and have had a prophylactic mastectomy on medical advice.
(BrightRock’s pay-outs are tiered, based on severity. Therefore, the percentage of pay-out that a policyholder will receive for an early stage breast cancer will be lower than the pay-out they’ll receive for cancer at a more advanced stage. However, our pay-outs for some more severe pre-cancers – for example, a ductal carcinoma-in-situ of the breast – are relatively high, given their potential clinical and financial impact. In the case of the ductal carcinoma of the breast, policyholders will receive 50% of sum assured. Our pay-out for prophylactic mastectomy (medically sanctioned) for a family history of breast cancer is 25% of the sum insured. However, thanks to our extender benefit BrightRock policyholders can go onto claim again if they don’t recover, accessing cover up to 200%).
Cover for progressions and multiple claims: Because cancer is a progressive disease, and certain breast cancers are fairly aggressive, it’s possible that a policyholder may get sick again, despite previous remission. However, the majority of dread disease products still offer a single lump-sum pay-out to fund the additional expense needs that may arise because of a severe illness like breast cancer. For some clients, the lump-sum may provide adequate coverage of the expenses they face. However, for some clients, the lump-sum for initial immediate expenses may need to be supplemented by a recurring pay-out for regular and ongoing expenses that are not catered for by the client’s income protection and medical scheme benefits.
BrightRock has introduced the ability for policyholders to increase their pay-outs if needed at claim stage. For certain conditions where the potential outcomes vary to a large extent, our policyholders can opt to receive their 100% pay-out as a lump-sum, or they can choose to receive a lower lump-sum pay-out initially, followed by a series regular monthly pay-outs. They receive these pay-outs for a specific number of months. The latter option can increase the policyholder’s total pay-out to up to 142% (depending on the condition).
Furthermore, if policyholders haven’t recovered at the end of the period and therefore are likely to face ongoing expenses, they can continue to receive these monthly pay-outs until they’ve received a total of 200% of the sum insured.
Policyholders can also claim for progressions of the disease or unrelated conditions, up to a maximum of 200% per body system. Depending on the policyholder’s diagnosis and prognosis, their financial needs and the cover choices they made, they can receive pay-outs of up to 400% per body system.
(BrightRock also offers policyholders the choice of adding the advanced pay-out option to their coverage. This option automatically increases the policyholder’s pay-out for specific conditions, usually where future progression or further claims are likely, like many cancers. By choosing to add this option to their cover, we’ll increase the client’s first claims pay-out for one of the listed conditions by as much as 50% of the sum insured. For example, if a client has selected the advanced pay-out option, their 25% pay-out for a lobular carcinoma-in-situ of the breast that has resulted in a mastectomy will automatically increase to 75%.)
2. Give ‘n Gain
*** Originally published in FA News. Read the original article here.
24 October 2014. iAfrica.com.
The recent decision by Moody’s Investors Service to downgrade the credit rating of South Africa’s four biggest banks, has once again brought that ugliest of four-letter words – “debt” – to everyone’s lips. The decision to downgrade Absa, Firstrand, Nedbank and Standard Bank came shortly after the collapse of African Bank, the largest provider of unsecured loans in South Africa.
This has raised the question whether consumer lending is getting out of hand, and banks are under increasing pressure to scrutinise credit records and reduce the amount of money they lend to consumers.
A sound credit record will be helpful when it really matters – like when you would like to buy a house. Achieving this will be impossible if you don’t have a squeaky clean credit history.
Knowledge is power. Don’t be taken by surprise with a financial consultant or future employer flagging your credit score – check it yourself. All South Africans are entitled to obtain information on their credit scores for free once a year. You can do this through a variety of online services or ask your financial adviser for assistance.
Credit cards, retail accounts, instalment loan accounts and vehicle and bond repayments are all forms of debt that influence your credit record. The more you miss your repayments, the stronger the likelihood that your credit record will reflect this. If you can’t pay your bills on time, negotiate new payment deadlines with your bank or creditors – they might be more understanding than you think.
Whilst owing a substantial amount of money may not necessarily affect your credit score, it might deter institutions from granting you any further credit as they might feel you are too far in the red. You need to make an obvious effort to show that you are managing your debt, and this can be done by budgeting and making the necessary cuts in your expenses.
As a rule of thumb, your credit score is affected by the length of your credit history. Consider applying for a loan or a credit card if you’ve never had any debt before. We’re not saying pile on loads of debt, but create a footprint of good debt management that will give financial institutions reasons to loan you more funds when you really need it.
Opening and closing credit and retail accounts on a regular basis won’t improve your credit score. Nor will paying old debt with new debt. If you’re not happy with your credit score, focus on existing accounts or institutions affecting it by ensuring you meet the required payment deadlines and honouring your debt in full.
* Written by BrightRock exeuctive director Schalk Malan.
** First published in iAfrica.com
19 September 2014. Adlip.com.
The concept entailed a young aspiring (bumbling) journalist who gets the big break of his career – which he is convinced, will propel him to journalistic stardom. He resigns from his job as ‘Foreign Correspondent’ on Loyiso Gola‘s Late Night News and embarks on a mis-adventure as a senior sports reporter, reporting from the World Cup in Brazil. On arrival in Brazil he discovers that many challenges await him, starting with the fact that he isn’t accredited to go to any of the games. However, says Stevens, he never gives up and naive self-importance carries him through and enables him to continually deliver his 33-day broadcast back to eNCA.
So what’s BrightRock’s marketing strategy behind a mishap-beset, aspiring journalist?
Stevens tells us that the strategy behind ‘Dave’ started with the BrightRock product itself: the first life insurance policy that changes as the policy holder’s life-needs change. These life changes or ‘Change Moments’ could be having a child, getting married, buying a house or even landing one’s dream job. So, out of this concept of sometimes unpredictable ‘change moments’, Dave was born, leveraging the newsworthiness the World Cup, the universality of humour and the platform of the daily news, to drive consumers to BrightRock’s products and Change Exchange site.
BrightRock’s Change Exchange site capturing the consumers
Stevens reports that there are now in excess of 25 000 unique users on BrightRock’s Change Exchange site, with over 40% of those users coming back regularly. Users are spending on average 2.30 minutes on the site and are viewing 3-4 pages on each visit. “The intention of the Change Exchange is very much around engagement with content and so we are very pleased that within the first four to five months of its existence we are getting such good traction,” concludes Stevens.
* See the video interview with Stevens here.
** Read the original Adlip article here.
It takes a very sharp, very bright mind to compute the variables for every quotation generated for a BrightRock policyholder. Meet Flint, our super-computer processing application.
When a BrightRock financial adviser sits down to prepare a quotation for a client, you can be sure that there’s a whole lot of thinking going on.
Happily, the lion’s share of that superhuman deliberation is handled by a smart and sophisticated software application called Flint.
That’s the program developed by BrightRock’s actuaries and systems developers, to accommodate the multitude of variables at the heart of our tailor-made philosophy of life.
As Leopold Malan, founding partner and Executive Director of Processing at BrightRock explains, Flint allows clients to tailor the growth and behaviour of their cover with unprecedented precision. “The technology and computing power to do this just didn’t exist ten years ago,” says Leopold.
Now, with expert insight and input from your financial adviser, Flint simply crunches the numbers and makes life easier for all concerned.
Here’s how it works. If you choose cover for debt, such as an outstanding bond, or for your childcare needs, the cover can decrease automatically over time, as the amount of cover you need decreases. Cover for healthcare and household needs, on the other hand, can continue to grow for the rest of the policyholder’s life. With traditional life insurance policies, these changes would not happen dynamically. Instead, you – with your financial adviser’s help – would have to ask your life insurer to adjust your cover down if you found, after a few years, that you no longer needed some of the cover. And because you had paid from your first premium for the cover that you had now decided to sacrifice, you would lose money in the process too. Because traditional product structures in the market have been unable to price this into the premium, cover has tended to be needlessly expensive and wasteful.
In part, this is because existing technology could not generate the sophisticated calculations required to adjust premiums dynamically over time, in relation to the decreasing cover need.
Instead, cover and premium amounts could only be calculated based on fixed relationships from year to year.
But now, thanks to BrightRock’s unique calculation methodology, powered by Flint, we are able to calculate cover dynamically.
That means your cover is priced correctly, right from the very first premium, allowing you to save an average of 30% on your monthly premiums from day one.. There’s no waste, and you can get much closer to the risk-planning objectives you’ve set in consultation with your financial adviser.
Twenty-five million calculations per premium. That’s a lot of processing power. That’s a lot of flexibility. That’s a lot of thinking…for life. And every calculation is designed just for you!
When your needs change, your life policy should be able to change too. Here’s a new way to take care of that, with the yearly secured cover facility from BrightRock.
Life changes like the seasons. We welcome the advent of Spring, revel in the warmth of Summer, take stock in the shifting tones of Autumn, and stoke the fires in the icy chill of Winter.
Armed with knowledge and insight, gained from experience, we anticipate the changes each season will bring, and we ready ourselves accordingly to make the most of it.
That’s the way it is with life too. As the seasons change, so do our needs and priorities, dynamically and organically over time. Matching these needs, to suit you as an individual, is where BrightRock can make a real and vital difference to your life.
BrightRock’s needs-matched cover is designed from the outset to change with anticipated changes in your needs over time. For example, when it comes to your income protection cover for an illness or injury with a permanent financial impact, your BrightRock cover is designed to reduce as you age and the number of pay cheques that need to be covered reduces.
This smart structure allows you to save on your premiums from day one by ensuring that you don’t pay for cover you won’t need in future. But what if things change in future, and you do end up needing that cover – for example, if you have to postpone your expected retirement date, later in life?
Our needs-matching philosophy, backed by world-first product structures and sophisticated technology, is designed to make sure your cover stays relevant even when unexpected changes occur, so that you can change and adapt it with as little administrative and underwriting impact as possible.
So let’s introduce you to a new facility that allows you to increase your cover every year, if you need to.
It’s called the yearly secured cover facility, and it lets you buy cover for the lumpsum amount by which your life cover for income protection needs has reduced during the year if it has reduced at all.
Before we look at how this works in practice, let’s focus on what life cover gives you in the first place. In essence, it provides cover for your financial obligations, on death. That means:
These are all recurring expenses that, during your lifetime, would be provided for by your income, either from working, or in later years, from your retirement savings. But even though your income needs will increase over time, a smaller lump-sum will be required to cover these needs as you near retirement age.
Traditional life insurance policies don’t take this inherent difference into account. With a traditional policy, your life cover increases at a set rate for life, even though the lump-sum needed to cover your income needs will decrease.
That means wasted premiums, because your cover will be priced for the maximum term from day one. The solution? A cutting-edge approach from BrightRock. Our unique methodology lets us calculate cover dynamically, which ensures that cover is priced correctly from the first premium. On average, clients save a minimum of 30% on their monthly premiums with BrightRock.
Now, with the yearly secured cover facility, you can buy cover each year that is equal to the amount by which your cover reduced during the year. The cover can be structured for any term, or for whole of life, and the only medical underwriting requirement is an HIV test.
It’s all part of all our plan to give you the cover that matches your needs, whatever the changing seasons may hold!
*For more information on the yearly secured cover facility, speak to your BrightRock broker, or visit us at www.brightrock.co.za.
How It works
Here’s an example of how the BrightRock yearly secured cover facility can be applied in practise.
A 34-year-old male (non-smoker, best rates) takes out life cover with BrightRock to protect his recurring income protection needs of R25 000 per month.
He’s chosen for the cover to grow at CPI, with premiums increasing by CPI + 3.5%.
Thanks to needs-matched efficiency, he is able to save 34% on his monthly premium. The yearly secured cover facility is first available to him at the age of 48, when he first expects the value of his remaining income to start decreasing, and his life cover for these income protection needs starts reducing. By this stage, his initial premium savings will mean that he will already have saved R193 680.
Importantly, this saving is unconditional and starts from day one. He can use the saving as he chooses – to buy more cover, reduce debt, or increase his retirement savings.
28 July, 2014. FA News.
A change-focussed online conversation platform conceived by needs-matched life insurance player, BrightRock.
Former South African cricket captain Graeme Smith started taking care of other guys, coaches and staff on tour at the age of 22 – something that was set to change his life forever. Now that he’s retired from professional cricket, his responsibilities are fully focused on his family.
“It’s like running a business. There’s a lot more love and care involved in a family – but it’s a similar thing: You have to manage relationships.”
This is one of many conversations taking place on BrightRock’s Change Exchange (www.changeexchange.co.za), a dynamic online platform that taps into the emotions behind consumers’ biggest financial decisions. It is a space where people can learn from others going through the same “Change Moments”, ask questions and share experiences.
The most recent of these conversations is an exclusive interview between former Carte Blanche presenter Ruda Landman and Graeme, which was published on the Change Exchange earlier today (24 July 2014). Having tied the knot, had kids and given up his professional cricketing career to spend more time with his family, Graeme shares how he has been navigating these big changes in his life.
This is the second of a series of change-focussed interviews by Ruda, who herself is no stranger to change, having given up a secure, stable job in the media to pursue a career in freelancing. That’s why the series kicked off in May with an interview with Gareth Cliff, who left his job as a radio DJ to start his own “unradio” show, CliffCentral.
Says Ruda, “I find that people like to define you in terms of ‘what you do’ and if they feel that they cannot do this, they can’t quite understand it. In addition, moving to something that doesn’t come with a set salary package is daunting. I was curious to speak to both Graeme and Gareth about their motivation in making this significant change and what has guided their career decisions in the past.”
The Change Exchange focuses on four key Change Moments, which include “Starting a family”, “Tying the knot”, “Landing that job” and “Making a home”. A diverse mix of contributors, known as Change Agents, have shared their experiences on the Change Exchange — to name a few: Sam Wilson, Maya Fisher-French, Alan Knot-Craig jr.,Kagiso Msimango, Richard Mulholland, Stuart Taylor and Stacey Vee.
Suzanne Stevens, Executive Director at BrightRock explains that they have identified an opportunity to engage with consumers at a more personal, emotional level. Industry research shows that consumers’ propensity to initiate an insurance purchase is far higher at these times. A 2012 study in the Journal of Risk and Insurance* found that new parents were 40% more likely to buy life insurance cover. It also showed an increase in self-initiated life insurance purchases when starting a new job.
“These significant life changes not only impact consumers’ finances, but also their health, lifestyle and sense of identity. BrightRock has identified an opportunity to engage with consumers at a more personal, emotional level.
“Traditionally, the role life insurance plays at these times is limited to the financial aspects of the change, and the interaction between provider and consumer tends towards the factual and rational. But these are moments that reshape the way we look at the world, and the way the world looks at us. The emerging field of behavioural economics has shown that people are far more driven by emotions and unconscious biases when making financial decisions than previously thought. BrightRock operates in this space, where emotions and money meet,” says Stevens.
“As our product is designed to change with you as your financial interests shift at these major, life changing moments, we believe these moments are exactly the right time to be engaging with consumers in a way that addresses both the financial and emotional impacts. Our product addresses people’s financial needs, and our aim with the Change Exchange is to also help people navigate some of the other aspects of these moments, regardless of whether they’re a BrightRock client or not.”
Since launching the Change Exchange in March 2014, over 14 000 visitors have enjoyed over 20 000 sessions on the site. This engagement has also spilled over into the social media space, with over 4 600 conversations flowing out of the topics discussed on the Change Exchange. Says Stevens: “These are early indicators that the concept is sound and the quality of the content is good. But we are well aware that these are the very first ‘baby steps’ and we fully expect that the Change Exchange will mirror life, and will change over time as it grows!”
Many more change moment Ruda-interviews are in the pipeline – some with well-known personalities, and some with interesting people you may never have heard of. One of these is an interview with her son, Johannes about his own drastic career-change from a position in television production to financial services.
Join the conversation at www.changeexchange.co.za.
18 July 2014. Cover Magazine. With a growing insurance gap and regulatory changes in the offing, risk opportunity are abound in the life insurance industries. The smart money’s on insurance players that are ready to seize the opportunity for change. In November last year, the Association for Savings and Investments (ASISA) published its insurance gap study. South Africans are underinsured by R24 trillion. Conducted by True South Actuaries and Consultants in partnership with Unisa’s Bureau of Market Research, the study found that employed South Africans between the ages of 18 and 65 require 62% more death cover than they currently have and about 60% more disability cover. Industry statistics by True South and ASISA show that new recurring premium policies declined by 16% in the first half of 2013. The last Ernst & Young Financial Services Index showed a drop in SA life insurers’ confidence levels. The index cites GDP growth and global economic outlook as the main drivers of the decline. The IMF has cautioned growth has slowed and financial conditions have tightened in emerging economies. The industry paid risk benefits of R13 billion on individual life policies in the first six months of 2013 and R6 billion in risk benefits on group life policies. Stats SA employment statistics indicate that more than 1,9 million South Africans are employed in the financial industry, many of which work in the life insurance sector, one of SA’s most stable labour sectors. South Africa ranks among the world’s top 20 insurance markets. Dread disease cover is a South African invention exported to the US, Canada, Australia and New Zealand. We need more innovation and more consumer-centric products. Life insurance has become increasingly commoditised. The basic product structures have remained unchanged and even the ‘new-generation products’ have been around for more than a decade. Despite signing up for ‘whole of life cover’, many policyholders lapse their cover within ten years, due to economic pressures and outdated and inefficient product structures. Deliver better value Traditional life insurance product are priced for the maximum term and set to increase over time, funded by a premium that increases too, often at a high rate. As costs rise consumers inevitably buy down or lapse cover. In practice they’re paying life-long rates for term cover. This is inefficient and wasteful. Insurance should match needs and each component of a policyholder’s cover should be priced for the duration it’s needed. Identify need for cover Life insurers should show people their specific financial needs and how their life insurance can meet those needs. Product structures must be adjusted to clarify the link between consumers’ need and their insurance cover. Understand trade-offs When it comes to life insurance cover sacrifices and rewards are less clear. Industry research shows that South Africans prioritise death cover over disability and income protection cover. If consumers can discern the exact purpose of their cover relative to their financial needs, they would prioritise their life insurance purchasing decisions more appropriately. Products must support advice Advisors are reliant on product providers to create products and systems that support and streamline the advice task. Fortunately technological advances can help cut down on unnecessary paperwork and task duplication. Sustainability over time Premium funding patterns offer premiums at a discount, followed by premium increases as the policyholder ages, to compensate for the discount. When premiums grow out of kilter with the underlying cover policyholders are likely to reduce their cover or give it up. BrightRock commissioned a study that found that more efficient products free up premium savings that negate aggressive age-rating. The majority of our clients opt for more conservative, more sustainable premium patterns with more affordable initial premiums. As the ASISA gap study shows, consumers need life cover in tough economic times. It’s time our industry change their life insurance cover to meet their needs. After all, the flipside of risk is opportunity. – Written by Schalk Malan, executive director at BrightRock. Read the original article here. 21 Mei 2014. Kuier. ‘n Kredietkaart is so gemaklik: swipe nou en betaal later. Maar as jy nie matigheid voor oë hou met jou kooplus nie, kan jy in ‘n bose skuld-kringloop verval. DEUR IVOR PRICE Dit is daar om jou lewe makliker te maak – veral in noodgevalle – maar as jy jou kredietkaart misbruik, gaan dit jou duur te staan kom. Haar kredietkaart was daar vir vriende en familie se plesier, erken die 39-jarige Medine Louw van Robertsham, Johannesburg. Kos en klere, wegbreek-naweke, noem dit op – as die kat iewers op die stoof gesit het, het sy sonder om te aarsel die winkels ingevaar. “Ek en my man, Jeremy (46), het al lelik vasgesit. Ek het gevoel dis my kaart en ek laat nie ‘n man vir my voorsê oor my geld nie. As ek maar net na hom geluister het…” Die blote gedagte aan haar kredietkaart-skuld, wat teen Junie afbetaal behoort te wees, maak haar gespanne. “Ek het al so skaam gekry as die bank se mense my op kantoor bel agter hul geld aan. Die mense wat ek al die jare uitgehelp het, was skielik nêrens te vind nie. Nou sit ek met die slegte kredietrekord.” Medine, wat as verpleegster by ‘n kliniek werk, is te skaam om te sê presies hoeveel kredietkaartskuld sy oor die jare opgebou het. Maar Jeremy draai nie doekies om nie. “Sê vir die mense,” por hy haar aan. “Vir wat is jy nog skaam? Dit was R209113 in vyf jaar. Dis amper wat ons huis gekos het – en dit sluit nie eens die rente in nie.” ‘n Onafhanklike finansiële raadgewer, Schalk Joubert, sê Medine is nie alleen nie. Saam spandeer Suid-Afrikaners meer as R1,2 miljard per maand op hui kredietkaarte en die meeste sukkel om met die afbetalings by te bly. “Dis asof die kredietkaart ‘n gat in mense se sakke brand. Ek klink al of ek preek, maar ek se elke dag vir mense: Hou eerder die kaart by die huis as jy nie nodig het om dadelikte bestee nie. ‘n Kredietkaart is ‘n ding vir ‘n noodgeval – en ‘n noodgeval is nie ‘n verjaardagpartytjie of ‘n nuwe uitrusting nie.” “MOENIE DIT DOEN NIE” Schalk Malan, ‘n uitvoerende direkteur van BrightRock, beveel mense aan om in hul maandelikse begrotings moeite te doen om kredietkaarte eerste af te betaal. Kredietkaarte het altyd die hoogste rentekoerse. “Die rente wat op gemiddelde kredietkaartskuld van R10 000 betaal word, is meer as twee keer die koste van R10 000 op ‘n huisverband oor vyf jaar. Verlaag die limiet op jou kredietkaart. Of nog beter: Knip die kaart heeltemal op.” Volgens Medine is dit moeilik om te sê wat die domste ding is wat sy al ooit op haar kredietkaart aangekoop het. “Mens tel nie wat jy deur die jare vir ander mense gedoen het nie, maar miskien moes ek nie maand na maand groceries vir ander mense gekoop het nie. Tot die bure (wat intussen verhuis het) het geweet ek het ‘n kredietkaart en hulle kan my kontak as hulle in die nood is.” Jeremy het egter ‘n hele paar dinge om op die lysie by te voeg. “Ek het agterna al die uitgawes op die Computer oorgesit en ons was geskok. Daar was ‘n matriek-afskeidrok vir ‘n kerksuster se kind. Ons het in een naweek meer as R7 000 geblaas by Sun City. Party maande het ons sommer die huis betaal met geld uit die kredietkaart.” Medine sê sy het vir jare in stilte gely en korttermyn-lenings gemaak om die kredietkaart af te betaal. “Maar toe ons kind hoërskool toe gaan, het dit moeiliker geraak. Alles was duurder en ek moes oop kaarte met Jeremy speel. Maar vandag is ek bly.” Schalk het oor die jare ‘n lysie saamgestel van dinge wat jy nooit op jou kredietkaart moet koop nie. Hy beskryf dit as `n skande-lysie wat jou “arm en siek” sal maak: 1. Moet nooit die kredietkaart gebruik om lewensonkoste te dek of skuld af te betaal nie. Dit skep net `n bose skuld-kringloop waaruit jy moeilik sal ontsnap. 2. Sê nee vir meer as een kredietkaart, al klink dit hoe aanloklik. As jy eers ‘n kredietkaart by een bank gekry het, is daar ‘n goeie kans dat `n ander bank jou ook een sal aanbied. 2. Moenie die kaart gebruik vir enigiets wat nie op jou begroting is nie. As jy byvoorbeeld R1000 blaas, kan jy tot 26% rente betaal. Die item gaan jou dan sowat R1 260 kos. 3. ‘n Kredietkaart is nie daar om geskenke of luukse items mee te koop nie. 4. Sê nee as die bank bel en vra of hulle jaarliks jou krediet-limiet kan verhoog. Jy kan dit net bekostig as jou salaris ook in so ‘n mate gegroei het. 5. Hou jou kredietkaart apart van jou bankrekening. Moenie jou salaris daarin laat betaal nie en dink twee keer voor jy geld blaas. ‘n Tjek- of spaarrekening is aansienlik goedkoper vir transaksies soos geld by ‘n OTM trek en elektroniese oorbetalings 6. Probeer om nie die kaart te gebruik om vir studies te betaal nie. Vra maar rond: ‘n Outydse studentelening is aansienlik goedkoper. 7. Moenie jou kredietkaart gebruik om uitstaande skuld af te betaal of skuld te konsolideer nie. Daar is finansiële instellings wat skuld-konsolidasie teen verlaagde rentekoerse aanbied. Because your life insurance needs change as your life changes, we’ve come up with a bright new way to keep you covered for life. Introducing the BrightRock automatic cover conversion facility. Love, so the poets and songwriters tell us, is the force that makes the world go round. Bankers take a less romantic view: it’s money, money, money that keeps the planet spinning on its axis. Technologists will argue, in the 21st Century, that data and information are the drivers of perpetual motion. But here at BrightRock, we take a different view. We believe that life turns on the power of change, from one season, one moment to the next. That’s why we’re changing the way life works, through our unique needs-matched life insurance that One of its special features is the Cover Conversion. It’s an industry first, and it allows you, the policyholder, to “redirect” your premiums from one insurance need to another. Let’s say you’ve paid off your bond and have had another child since taking out your policy. With traditional life insurance, you would lose the cover, for which you’ve already undergone underwriting, in that particular area of your risk portfolio. This means you would lose the value you’ve built up by paying for cover, and not having claimed – even while you may remain underinsured in another area. But with our cover conversion facility, you can simply use the premiums for your bond cover to boost your cover, on death, for childcare needs. To use another example, perhaps you’re nearing Easy: use our automatic cover conversion facility to redirect your premiums to your new area of need, free of charge and free of medical underwriting. You can do this whenever your needs change, not just when cover for a specific need has expired. Subject to certain conditions, you can even redirect your expiring death cover to buy more death cover – even if your health has worsened or you’ve made a claim. Our cover conversion is an automatic feature on all standard BrightRock policies, and is fundamental to the efficiency of our needsmatched product design. We believe that being able to move premiums from death and illness or injury cover to your additional expense needs, without having to undergo medical tests, is a powerful and unique benefit that will change the way you look at life. By appropriately pricing cover for your short, medium, and long-term needs, we’re able to save you an average of 30 per cent on your premiums. That’s change you can love, as you learn to Love * To find out more, call your financial adviser, or visit www.brightrock.co.za. Introducing The Change Exchange, a bright new online platform for learning, sharing, and telling stories about the power of change in our lives. Remember those moments that changed your life? Those moments when you knew, in an instant, that nothing would ever be the same. That “yes!” moment. That “I do” moment. That moment when your baby’s first cry pierced the air. That first day of school. That graduation ceremony. That first job, that first car, that first turn of the key in the door of your brand-new home. Life is full of moments that reshape the way we look at the world, and the way the world looks at us. At BrightRock, we call them “Change Moments”, and we believe they should be welcomed and celebrated as points of origin on the journey to the ultimate destination. The future. But Change Moments can be scary and bewildering too, and that’s why, as part of our philosophy of “Love Change”, we’ve launched a bright new platform for learning, sharing, and talking about the power of change in our lives. It’s called the Change Exchange, and it’s an online resource centre designed to help you deal with life’s “Big Deal” changes, and how they affect your health, your finances, your work, your family, and your life. We want you to know that you’re not alone when it comes to coping with change, and so we’ve rounded up a collective of “Change Agents” who have knowledge, experience, wisdom and insights to share. On the Change Exchange, at www.changeexchange.co.za, you’ll find interesting and enlightening articles on Change Moments, along with opinion, advice, and ample opportunities to exchange your views, share your stories, and ask your questions. So whether you’re tying the knot, starting a family, making a home, trying to land your ideal job, or just looking for a change, click on the link when you have a moment… and let’s start putting change into life! Find out more about our Change Agents here.
changes as your needs change.
retirement, and no longer require as much illness or injury and death cover as before. But maybe you need more additional expenses cover.
Change – whatever life holds in store!
18 July 2014. Cover Magazine.
With a growing insurance gap and regulatory changes in the offing, risk opportunity are abound in the life insurance industries. The smart money’s on insurance players that are ready to seize the opportunity for change.
In November last year, the Association for Savings and Investments (ASISA) published its insurance gap study. South Africans are underinsured by R24 trillion. Conducted by True South Actuaries and Consultants in partnership with Unisa’s Bureau of Market Research, the study found that employed South Africans between the ages of 18 and 65 require 62% more death cover than they currently have and about 60% more disability cover.
Industry statistics by True South and ASISA show that new recurring premium policies declined by 16% in the first half of 2013. The last Ernst & Young Financial Services Index showed a drop in SA life insurers’ confidence levels. The index cites GDP growth and global economic outlook as the main drivers of the decline. The IMF has cautioned growth has slowed and financial conditions have tightened in emerging economies.
The industry paid risk benefits of R13 billion on individual life policies in the first six months of 2013 and R6 billion in risk benefits on group life policies.
Stats SA employment statistics indicate that more than 1,9 million South Africans are employed in the financial industry, many of which work in the life insurance sector, one of SA’s most stable labour sectors.
South Africa ranks among the world’s top 20 insurance markets. Dread disease cover is a South African invention exported to the US, Canada, Australia and New Zealand.
We need more innovation and more consumer-centric products. Life insurance has become increasingly commoditised. The basic product structures have remained unchanged and even the ‘new-generation products’ have been around for more than a decade.
Despite signing up for ‘whole of life cover’, many policyholders lapse their cover within ten years, due to economic pressures and outdated and inefficient product structures.
Deliver better value
Traditional life insurance product are priced for the maximum term and set to increase over time, funded by a premium that increases too, often at a high rate. As costs rise consumers inevitably buy down or lapse cover. In practice they’re paying life-long rates for term cover. This is inefficient and wasteful. Insurance should match needs and each component of a policyholder’s cover should be priced for the duration it’s needed.
Identify need for cover
Life insurers should show people their specific financial needs and how their life insurance can meet those needs. Product structures must be adjusted to clarify the link between consumers’ need and their insurance cover.
When it comes to life insurance cover sacrifices and rewards are less clear. Industry research shows that South Africans prioritise death cover over disability and income protection cover. If consumers can discern the exact purpose of their cover relative to their financial needs, they would prioritise their life insurance purchasing decisions more appropriately.
Products must support advice
Advisors are reliant on product providers to create products and systems that support and streamline the advice task. Fortunately technological advances can help cut down on unnecessary paperwork and task duplication.
Sustainability over time
Premium funding patterns offer premiums at a discount, followed by premium increases as the policyholder ages, to compensate for the discount. When premiums grow out of kilter with the underlying cover policyholders are likely to reduce their cover or give it up. BrightRock commissioned a study that found that more efficient products free up premium savings that negate aggressive age-rating. The majority of our clients opt for more conservative, more sustainable premium patterns with more affordable initial premiums.
As the ASISA gap study shows, consumers need life cover in tough economic times. It’s time our industry change their life insurance cover to meet their needs. After all, the flipside of risk is opportunity.
– Written by Schalk Malan, executive director at BrightRock. Read the original article here.
21 Mei 2014. Kuier.
‘n Kredietkaart is so gemaklik: swipe nou en betaal later. Maar as jy nie matigheid voor oë hou met jou kooplus nie, kan jy in ‘n bose skuld-kringloop verval. DEUR IVOR PRICE
Dit is daar om jou lewe makliker te maak – veral in noodgevalle – maar as jy jou kredietkaart misbruik, gaan dit jou duur te staan kom. Haar kredietkaart was daar vir vriende en familie se plesier, erken die 39-jarige Medine Louw van Robertsham, Johannesburg. Kos en klere, wegbreek-naweke, noem dit op – as die kat iewers op die stoof gesit het, het sy sonder om te aarsel die winkels ingevaar.
“Ek en my man, Jeremy (46), het al lelik vasgesit. Ek het gevoel dis my kaart en ek laat nie ‘n man vir my voorsê oor my geld nie. As ek maar net na hom geluister het…” Die blote gedagte aan haar kredietkaart-skuld, wat teen Junie afbetaal behoort te wees, maak haar gespanne.
“Ek het al so skaam gekry as die bank se mense my op kantoor bel agter hul geld aan. Die mense wat ek al die jare uitgehelp het, was skielik nêrens te vind nie. Nou sit ek met die slegte kredietrekord.”
Medine, wat as verpleegster by ‘n kliniek werk, is te skaam om te sê presies hoeveel kredietkaartskuld sy oor die jare opgebou het. Maar Jeremy draai nie doekies om nie.
“Sê vir die mense,” por hy haar aan. “Vir wat is jy nog skaam? Dit was R209113 in vyf jaar. Dis amper wat ons huis gekos het – en dit sluit nie eens die rente in nie.”
‘n Onafhanklike finansiële raadgewer, Schalk Joubert, sê Medine is nie alleen nie. Saam spandeer Suid-Afrikaners meer as R1,2 miljard per maand op hui kredietkaarte en die meeste sukkel om met die afbetalings by te bly.
“Dis asof die kredietkaart ‘n gat in mense se sakke brand. Ek klink al of ek preek, maar ek se elke dag vir mense: Hou eerder die kaart by die huis as jy nie nodig het om dadelikte bestee nie. ‘n Kredietkaart is ‘n ding vir ‘n noodgeval – en ‘n noodgeval is nie ‘n verjaardagpartytjie of ‘n nuwe uitrusting nie.”
“MOENIE DIT DOEN NIE”
Schalk Malan, ‘n uitvoerende direkteur van BrightRock, beveel mense aan om in hul maandelikse begrotings moeite te doen om kredietkaarte eerste af te betaal. Kredietkaarte het altyd die hoogste rentekoerse.
“Die rente wat op gemiddelde kredietkaartskuld van R10 000 betaal word, is meer as twee keer die koste van R10 000 op ‘n huisverband oor vyf jaar. Verlaag die limiet op jou kredietkaart. Of nog beter: Knip die kaart heeltemal op.”
Volgens Medine is dit moeilik om te sê wat die domste ding is wat sy al ooit op haar kredietkaart aangekoop het.
“Mens tel nie wat jy deur die jare vir ander mense gedoen het nie, maar miskien moes ek nie maand na maand groceries vir ander mense gekoop het nie. Tot die bure (wat intussen verhuis het) het geweet ek het ‘n kredietkaart en hulle kan my kontak as hulle in die nood is.”
Jeremy het egter ‘n hele paar dinge om op die lysie by te voeg.
“Ek het agterna al die uitgawes op die Computer oorgesit en ons was geskok. Daar was ‘n matriek-afskeidrok vir ‘n kerksuster se kind. Ons het in een naweek meer as R7 000 geblaas by Sun City. Party maande het ons sommer die huis betaal met geld uit die kredietkaart.”
Medine sê sy het vir jare in stilte gely en korttermyn-lenings gemaak om die kredietkaart af te betaal.
“Maar toe ons kind hoërskool toe gaan, het dit moeiliker geraak. Alles was duurder en ek moes oop kaarte met Jeremy speel. Maar vandag is ek bly.”
Schalk het oor die jare ‘n lysie saamgestel van dinge wat jy nooit op jou kredietkaart moet koop nie. Hy beskryf dit as `n skande-lysie wat jou “arm en siek” sal maak:
1. Moet nooit die kredietkaart gebruik om lewensonkoste te dek of skuld af te betaal nie. Dit skep net `n bose skuld-kringloop waaruit jy moeilik sal ontsnap.
2. Sê nee vir meer as een kredietkaart, al klink dit hoe aanloklik. As jy eers ‘n kredietkaart by een bank gekry het, is daar ‘n goeie kans dat `n ander bank jou ook een sal aanbied.
2. Moenie die kaart gebruik vir enigiets wat nie op jou begroting is nie. As jy byvoorbeeld R1000 blaas, kan jy tot 26% rente betaal. Die item gaan jou dan sowat R1 260 kos.
3. ‘n Kredietkaart is nie daar om geskenke of luukse items mee te koop nie.
4. Sê nee as die bank bel en vra of hulle jaarliks jou krediet-limiet kan verhoog. Jy kan dit net bekostig as jou salaris ook in so ‘n mate gegroei het.
5. Hou jou kredietkaart apart van jou bankrekening. Moenie jou salaris daarin laat betaal nie en dink twee keer voor jy geld blaas. ‘n Tjek- of spaarrekening is aansienlik goedkoper vir transaksies soos geld by ‘n OTM trek en elektroniese oorbetalings
6. Probeer om nie die kaart te gebruik om vir studies te betaal nie. Vra maar rond: ‘n Outydse studentelening is aansienlik goedkoper.
7. Moenie jou kredietkaart gebruik om uitstaande skuld af te betaal of skuld te konsolideer nie. Daar is finansiële instellings wat skuld-konsolidasie teen verlaagde rentekoerse aanbied.
Because your life insurance needs change as your life changes, we’ve come up with a bright new way to keep you covered for life. Introducing the BrightRock automatic cover conversion facility.
Love, so the poets and songwriters tell us, is the force that makes the world go round. Bankers take a less romantic view: it’s money, money, money that keeps the planet spinning on its axis.
Technologists will argue, in the 21st Century, that data and information are the drivers of perpetual motion. But here at BrightRock, we take a different view.
We believe that life turns on the power of change, from one season, one moment to the next. That’s why we’re changing the way life works, through our unique needs-matched life insurance that
One of its special features is the Cover Conversion. It’s an industry first, and it allows you, the policyholder, to “redirect” your premiums from one insurance need to another.
Let’s say you’ve paid off your bond and have had another child since taking out your policy. With traditional life insurance, you would lose the cover, for which you’ve already undergone underwriting, in that particular area of your risk portfolio.
This means you would lose the value you’ve built up by paying for cover, and not having claimed – even while you may remain underinsured in another area.
But with our cover conversion facility, you can simply use the premiums for your bond cover to boost your cover, on death, for childcare needs. To use another example, perhaps you’re nearing
Easy: use our automatic cover conversion facility to redirect your premiums to your new area of need, free of charge and free of medical underwriting. You can do this whenever your needs change, not just when cover for a specific need has expired.
Subject to certain conditions, you can even redirect your expiring death cover to buy more death cover – even if your health has worsened or you’ve made a claim.
Our cover conversion is an automatic feature on all standard BrightRock policies, and is fundamental to the efficiency of our needsmatched product design.
We believe that being able to move premiums from death and illness or injury cover to your additional expense needs, without having to undergo medical tests, is a powerful and unique benefit that will change the way you look at life.
By appropriately pricing cover for your short, medium, and long-term needs, we’re able to save you an average of 30 per cent on your premiums. That’s change you can love, as you learn to Love
* To find out more, call your financial adviser, or visit www.brightrock.co.za.
Introducing The Change Exchange, a bright new online platform for learning, sharing, and telling stories about the power of change in our lives.
Remember those moments that changed your life?
Those moments when you knew, in an instant, that nothing would ever be the same.
That “yes!” moment. That “I do” moment. That moment when your baby’s first cry pierced the air. That first day of school. That graduation ceremony. That first job, that first car, that first turn of the key in the door of your brand-new home.
Life is full of moments that reshape the way we look at the world, and the way the world looks at us.
At BrightRock, we call them “Change Moments”, and we believe they should be welcomed and celebrated as points of origin on the journey to the ultimate destination. The future.
But Change Moments can be scary and bewildering too, and that’s why, as part of our philosophy of “Love Change”, we’ve launched a bright new platform for learning, sharing, and talking about the power of change in our lives.
It’s called the Change Exchange, and it’s an online resource centre designed to help you deal with life’s “Big Deal” changes, and how they affect your health, your finances, your work, your family, and your life.
We want you to know that you’re not alone when it comes to coping with change, and so we’ve rounded up a collective of “Change Agents” who have knowledge, experience, wisdom and insights to share.
On the Change Exchange, at www.changeexchange.co.za, you’ll find interesting and enlightening articles on Change Moments, along with opinion, advice, and ample opportunities to exchange your views, share your stories, and ask your questions. So whether you’re tying the knot, starting a family, making a home, trying to land your ideal job, or just looking for a change, click on the link when you have a moment… and let’s start putting change into life!
Find out more about our Change Agents here.