Recent SA Floods Highlight Need to Educate Public About Insurance

February 15 - The Chief Executive Officer of Lion of Africa Insurance, Adam Samie, has highlighted the need to educate the public about the risks of flooding and the need to take out insurance on their lives and property.

Samie said that the recent floods that swept through South Africa may not have been an insurance catastrophe in cut and dry terms, but they certainly caused a "social catastrophe", given that it was local communities who suffered the most.

Many of those houses affected were in the informal housing sector. R160 billion worth of infrastructure was damaged and over 20,000 people have been directly affected.

Samie stressed the need for the industry to educate the public more about the need to take out insurance.

"When it comes to financial education, much of the focus by business and government tends to be on encouraging people to save more," he said.

"However, in many instances, protecting your assets is as important as growing them."

Most South African policies tend to be a 'one-covers-all' type, with the ability to buy a single insurance policy that covers all weather related incidents such as flooding.

"In many other countries, this is not the case," said Samie. "For example, homeowners in California would have to buy more than one policy, such as taking out separate earthquake cover. In Europe, we also find that insurers often specify the extent of the cover by the distance to the river and the height of the building above a particular flood line."

South Africans should educate themselves - and be educated - about flooding and other types of insurance so that if they are affected, they will have maximum cover.