SP Wealth Management

FIVE TIP TIPS TO GET YOUR CLAIM PAID IN FULL

*Underinsurance*: In short, you are when you insure your assets for less than what is required, and what is required is to
be able to be in the same financial position as prior to your misfortune. The insured value of your contents and buildings of your private residential structures must be equal to the current replacement value, not the original purchase price or current market value. This is not just the case for when you have large losses. It is important to note that, if you are underinsured, you will also not be fully paid for smaller losses. If you insure for only 50% of the replacement value, then you will be paid only 50% of the loss in accordance with a principle called “averaging”.

However, calculating the replacement value of your building or contents is easier said than done. Neither you nor your broker is an
expert in this field. But it is only you that know the details of what you own. Insurers therefore often make different tools and services
available to assist clients in the evaluation process. These include inventories, the services of professional evaluators, and online
calculators. You will often find that, should you make use of these tools and insure for the suggested values, your insurer will scrap the average condition and you will then have the assurance that any claim, big or small, will be paid in full. Especially on home contents, replacement costs often are much higher than you may think. The small additional premium you pay for what seems to be inflated replacement values is well worth the ability to replace in full the assets you had when you suffer a loss.

*Excess*: An excess amount is the first amount payable for which the client is responsible. It is the agreed amount of money you pay
as a contribution towards repairs or replacements. While these excesses are highly differentiated in the insurance market, an excess amount is applicable to most short-term policies, and it is explicitly stated in all policy documents. Clients are advised to read this part of the policy carefully, so they do not get a shock when it comes to the claim stage. In some cases, clients can also adjust excesses (reduce or increase) to suit their needs, and in doing so pay an adjusted premium.

*Exclusions*: No insurance policy will cover all losses. However, most insurers will know what the market needs are and provide
appropriate cover to be competitive. Exclusions and limitations are largely there to ensure affordability, with the option to the buy
additional cover at a premium. Some conditions relate to high or unacceptable risks, like a home alarm or a vehicle tracking device
that needs be installed. With especially motor insurance, exclusions are one of the main pitfalls. Claims for mechanical or electrical
breakdowns are not covered under a normal vehicle insurance policy and require a vehicle warranty policy. Cover for car hire may need to be added, or extras fitted to the vehicle may have to be insured separately. Be sure to check that your policy covers multiple drivers of your vehicle and make sure you have declared the use of your vehicle correctly for either business use or private use. In addition to the exclusions stated on your policy, you also need to inform you insurer of any material changes, such as a change of address or a change in the regular driver of a .

*All-risks insurance*: This mostly refers to items that are portable, such as jewellery, cameras, laptops, mobile phones or tablets. As a
norm, if not specifically insured, these are generally still insured under your house contents policy, but only when they are at your home address. High-value items that can be removed from the risk address should be specified and then do not form part of the total value of the house contents. In recent years there have been developments with regard to the way cover is provided while contents are not at home, be it while at work, a child who is a student and living away from home, while , and in general. The cover available in the market can differ substantially, so it is important to consider a scenario where your assets are not at home and test the policy cover against your needs.

All-risks insurance normally carries a higher and is therefore more expensive. Insuring everything you remove from your premises may not be the best financial solution. Due to the current economic climate or personal circumstances, it is therefore vital to evaluate the priority of specifying these items, and only insure the items you want to by considering the following aspects:
• Monetary value
• Risk exposure (nature (high/low risk) of item lost or damaged).

*Personal liability*: This refers to insurance against a third party suing you in your personal capacity for financial loss, physical injury or death. The most common form relates to your house-owner’s insurance, covering the structure of your home and its permanent fittings and typically includes medical costs, restoring or replacing damaged property, pain and suffering to the injured party, loss of income, legal costs and expenses. Standard cover for personal is between R2m and R5m, but this may not be enough to save you from financial ruin if someone does claim against you. Most insurers, therefore, offer top-up cover at a low additional premium, extending your cover to R10m or even R20m as in the case of . As the chances of you claiming are very low, extended cover is highly affordable and probably well worth it

CMScript 9 of 2022: Focus on Mellitus Type 2

Diabetes Mellitus Type 2 or Type 2 Diabetes Mellitus (T2DM) is caused by the body not having enough insulin or being resistant to insulin. When the body is resistant to , the cells in the body do not respond normally to insulin.

Because T2DM usually occurs gradually and can take many years to develop, most people do not notice their symptoms or think other conditions cause them. If you have any risk factors for diabetes, it is essential to discuss screening with your doctor or health care provider.

T2DM is one of the conditions included in the Chronic Disease List (2CDL) of the Prescribed Minimum Benefit ( ) regulations. This means that medical schemes MUST fully fund the diagnosis, treatment, and care of T2DM. The minimum care and management of T2DM must be funded according to the algorithm in the PMB regulations, which is available here. Medical schemes are allowed to put in place managed care protocols and formularies to fund the diagnosis, treatment and care of T2DM.

as an example of personal, business and private use
Using the example of carpooling, the following scenarios demonstrate the three different categories of usage.

use:
Eve is a full time mother and does not engage in any form of employment. She uses her vehicle primarily to drive her children to and from school and to extra mural activities. Eve lives close to two other full time mothers, Nadia and Thandi. In order to reduce the costs associated with driving the children, Eve has entered into a car-pooling arrangement with Nadia and Thandi whereby each of the mothers takes turns to drive the children to and from school.
On Mondays, Delia, another mother from the school attends to her sick mother and is unableto drive her children home. She lives in the opposite direction from Eve but Eve has nonetheless offered to assist Delia by her children home. Delia pays Eve a small
amount to cover the additional used by Eve to make this extra trip. Eve does not make any profit from this payment.
Accordingly, Eve uses her car for personal use only.

use:
As times are tight, Eve has decided to embark on a part-time business venture in order to earn extra money. She is a qualified tax consultant. Nadia and Thandi are both required to submit tax returns each year and have engaged Eve’s services in order to assist them in doing so. On the days when Eve drives to Thandi or Nadia’s house to drop off their children, she spends a few minutes consulting with them on their tax issues. She also uses this
opportunity to deliver or collect documents that she needs in order to reconcile their accounts.
Eve is using her vehicle for personal and business use and must therefore insure it for business use.

use:
Thandi has been offered full time and is no longer able to carpool with Eve and Nadia. Eve offers to take over Thandi’s lifting obligations in exchange for a small payment.
After covering her petrol costs, Eve enjoys a small profit from this arrangement.
Eve is accordingly using her vehicle for commercial purposes.

RISK MITIGATION SERIES – PERSONAL LINES

KEEP YOUR BICYCLE (AND YOURSELF) SAFE

Whether you like ambling about on your bicycle for fun or are training for the next -bike or event, knowing how to stay safe is the best way to enjoy your time cycling.

An increasing number of South Africans are taking up cycling as a hobby and are purchasing bicycles fit for their lifestyle. Whether it
be for environmental reasons, saving petrol when commuting to work in city areas, to simply have fun or to compete in sport races,
thousands of South Africans are fully immersing themselves in this trend.

But regardless of whether you’re a beginner or a seasoned , we want to make sure you’re always safe wherever you may find
yourself, which is why we’ve put together this list of safety tips.

tips for cyclists
1. Like any vehicle, a bicycle needs to be serviced properly before you embark on any major challenge, or when parts start to get worn. Make sure you get your bike checked out.

2. Always obey the road rules with respect to cycling. You could start by familiarising yourself with these Cycling Rules of the Road and Road Safety from Arrive Alive.

3. Always wear a helmet while cycling. Cycling without a helmet has been illegal in South Africa since 2004.

4. Make sure you are always visible to motorists.

5. Keep your friends and family informed of your plans, whether you’re going for a long or short ride. Let them know which route you intend to take.

How to insure your
• You must specify the insurance cover for your bicycle in your policy with your insurer or intermediary.
• You can also insure accessories/gear relating to your bike, such as a helmet. This must be clearly specified in your policy.
• State whether your bicycle is used for pleasure purposes only or for professional use in competitions.
• Know what the current replacement value of your bicycle is and insure it for the same value.
• You will be asked to share the following information with your insurer in order to make sure you are adequately covered:

o Make, model, serial number, sum insured (replacement value of your bicycle);
o Type of bicycle, for example a or bicycle

power! Why is important 📝


Estate planning is a fancy term that means deciding what will happen to your money and your things when you pass away. Nobody likes to think about death, but if you plan for it, you can make life much easier for your loved ones should the worst happen.

It all starts with your will, which is a legal document that determines how your estate is distributed when you die. Your ‘estate’ is everything you own (your assets) minus what you owe (liabilities and costs related to your death). Anyone over the age of 16 is able to draw one up.

Why do I need a will?

Without a will, your estate will be divided according to the Law of Intestate Succession. In other words, you have no control over who inherits your assets. This law can be very blunt. If you live with your partner but you’re not married to them, for example, they will inherit nothing unless you have a will.

So, you need a will because it allows you to care for those who are financially dependent on you. Remember to keep your will updated, especially after significant life events such as getting married or divorced, having children, buying a house or starting a business.

What else do I need to know about wills?

Your will should include a nominated ‘executor’ – the person who will carry out your wishes and handle the administration of your estate. The admin part can be complex, so make sure you know who your nominated executor is and how much they will charge. Legally, an executor can ask for more than 4% (3.5% + VAT) of the assets in the estate. Depending on the size of your estate, it might be a good idea to negotiate the executor’s fee upfront and state it in your will.

If you have children, you could also include a nominated guardian for them. The guardian will look after your children if you pass away, so keep this section updated too, as life circumstances change. Nominating a grandparent might be fine when the kids are young, but they are getting older and might not be able to manage in a few years’ time…

What are the other benefits of estate planning?

The main benefit is that it reduces costs and lightens the burden on your loved ones when you pass away. Costs at death can be high. There’s estate duty to consider – a tax calculated at a minimum of 20% of the value of your estate – and there are other administrative expenses involved. Any outstanding debt must also be settled before your beneficiaries receive anything. A good estate plan will make provision for all the relevant costs, and even streamline some of them, meaning that more of your wealth goes to your family and less to unnecessary parties.

This links to the next point: Should you die, having an organised estate plan reduces the stress on your loved ones at an already stressful time. With a qualified and experienced executor appointed, and a clear will in place, the emotional distress of winding up your estate will be greatly reduced.

Ask for help

Estate planning is relatively simple for some people, but for others it can be a complex task. If you fall into the latter category, you might need to meet with a financial planner or estates specialist. Depending on your financial situation and whether your beneficiaries will require any special care when you pass away, a professional will also be able to suggest other estate planning tools such as setting up a trust, for example.

It’s always better to plan for the worst, even if death is scary to think about. You’ll feel much better once you’ve put a solid estate plan into place.

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What is an ?
• An exchange traded fund (ETF) is just a unit trust that trades on the stock exchange (governed by the same CISCA regulations).
• An ETF is composed of a basket of securities or assets that seeks to mirror the performance of an index.
• The underlying assets could be shares, bonds, money market instruments or a single commodity like gold or platinum.
• If the underlying assets perform well, the ETF will perform well – the opposite is also true.
ETFs are regulated by the and Financial Sector Conduct Authority ( )