We have amended our philosophy for SASRIA cover

Method to determine SASRIA cover

Generally, the calculation is straight forward; the SASRIA insured amount represents the insured amount of the primary cover and a rate is applied to obtain the premium.

However, SASRIA's Material Damage regulation provides more freedom in the way that clients are able to select cover and how the insured amount is determined. This can cause differences in insurer philosophy regarding the quantification of embedded covers and application of free cover limits, which may be unique to each insurer.

Discovery Business Insurance's philosophy

The Discovery Business Insurance product is made up of primary covers, buy ups, as well as embedded covers that are offered to clients at no additional premium. When calculating the SASRIA insured amount and premium in the past, we included an allowance for embedded covers and free cover limits.

We applied this philosophy to ensure that our clients received rich benefits and had the same cover in place regardless of whether the event was covered by Discovery Business Insurance or SASRIA.

Following market analysis and feedback from our brokers and clients, we have amended our philosophy to applying embedded SASRIA cover to be in line with market philosophy. Therefore, we will no longer quantify the value of embedded covers or include this in the calculation of the SASRIA insured amount or premium. As the broker, you will need to specify if your client wants to add SASRIA cover for embedded covers going forward. This change will apply to all new business quotes from 1 September 2021 and will be applied to existing business from the next anniversary date.

What you can expect when the new philosophy is applied:

• The overall new business quote premium will be cheaper with respect to SASRIA.
• The overall anniversary quote premium will be cheaper with respect to SASRIA.
• For existing business, the change will be applied at anniversary. Therefore, there will be no change in premium before the anniversary date.
• There will be more transparency in how the SASRIA insured amount and premium have been determined.
• The above should result in less queries and hence, quicker turnaround times for finalising quotes.

If you have any questions or want to get more information, please contact us by calling 011 529 6620 or emailing DBIServicing@discovery.co.za.