Impact of changes in SASRIA cover and rates
SASRIA has announced a number of changes on how they apply some covers and the rates charged for different sections of cover. In this article, we look at how some of these changes impact the way we apply SASRIA cover to plans.
Revenue cover
As detailed in circular 507, Revenue cover will no longer be insured under the Material damage coupon but will move to a new Revenue basis of cover under the Business Interruption coupon. This change is effective from 1 October 2021.
To reflect this change, we will endorse affected plans so that Revenue cover is moved into the Business Interruption coupon. This process of endorsing plans will be completed by 30 November 2021.
New rating class and separation of F2 coupon
Taking into account the claims volatility for municipalities, SASRIA has created a new rating class for this risk. The new rating class description is 'MUN' and attracts a rate of 0.02958% per annum.
SASRIA is also introducing a new rating structure for F2 (Fire commercial - Office). This is done to take into account the lower level of risk for office risks. This rating structure is only applicable to commercial office premises risks.
The above changes are effective from 1 February 2022 for new business, and for existing business from their next plan anniversary for plans renewing after 1 February 2022. These changes mean that after the effective date, different rates will apply to the different risks mentioned above.
Currently, these risks fall under the F2 SASRIA coupon (not split) and attract the same rate. Going forward, we will deploy the new rates on our system and we will match the new SASRIA rates for business commencing from 1 February 2022. We will apply the new rates using the same approach as detailed in the following section about SASRIA rate changes.
For more information, read the SASRIA circular 510.
Change in SASRIA rates
In circulars 514 and 515, SASRIA announced that they will be implementing rate changes for specific sections of cover effective from 1 February 2022. We will deploy the new rates on our system on 12 November 2021, thereafter we will match the new SASRIA rates for all new business quotes with commencement date from 1 February 2022.
We will use the following approach to implement the new rates:
- Existing plans and any new items added to existing plans will have the new rates applied at the next plan anniversary for plans renewing after 1 February 2022.
- New business quotes done before the deployment date of 12 November 2021 will have the old rates applied (for all commencement dates).
- After the deployment date:
- New business quotes, where the plan commences before 1 February 2022, will have the old rates applied.
- New business quotes, where the plan commences after 1 February 2022, will have the new rates applied.
Please communicate these changes to your clients so that they are aware of how their plans will be affected. If you have any questions, please contact us by calling 011 529 6620 or emailing DBIServicing@discovery.co.za.
