High inflation and stagnant economic growth have been a characteristic of the global economy since last year.
This is a result of a myriad of factors including increased consumer demand in a post-pandemic era, supply chain shortages across every sector, and the Russia-Ukraine conflict.
This situation will be further affected by the South African Reserve Bank recently announcing (on July 21) that interest rates would increase by 75 basis points, which takes the repo rate to 5.5% and the prime lending rate to 9%. Consequently, the insurance industry is adjusting premiums to account for inflationary increases.
The following tips can help you cope:
- Save on your premiums
We all know of or have heard the saying “the sooner you start to build up your profile, the better”, and this has been proven true. This means if you take out insurance as early as you can, and have no gap in cover, you will be able to build your risk profile, which could potentially mean saving on your premiums.
- Make sure your car is in order as fuel prices increase
You can waste a lot of fuel and expedite wear and tear on your car by not doing proper diagnostics and maintenance on your vehicle. Check your tyre alignment and pressure, coolant levels, loose parts, and oil levels, among other things.
Many workshops offer a multi-step check to see if your car is in a safe and well-maintained condition. This will save fuel in the long run as well as reduce the chances of potential mechanical failures and accidents.
- Check your security systems at home
We might get complacent about the things around the house we might not have paid much attention to. Double check that your security devices are linked to your service provider and that all keypads, silent alarms, emergency buttons and sensors are in working order.
Ensure that your pass codes are active on all keypads, that everyone remembers the codes, and that your trusted people know how it works. Keeping your home safe is paramount as this is your little piece of heaven in this big world.
Another way to enjoy lower premiums that’s a win-win is by increasing the safety at home. While safety measures such as CCTV cameras, electric fencing, burglar bars and can be a huge investment, clients can recoup some money through lower premiums on their home cover.
- Re-examine your insurance plan
Make sure your insurance is in order by going over what you have listed in your house and the value your belongings are insured for. You may have taken out a short-term policy for something you may not own anymore or listed items you have sold from your home. All of these nitty-gritty things add up to make your insurance premiums higher and eliminating them may save you money in the long run and avoid paying unnecessary premiums.
- Be safe in all situations
And finally, even if you don’t have grand plans for 2022, it’s not too late to switch to healthy money-saving habits. There is a lot to be said for making sure you are as safe as possible in every situation you can. Make sure your belongings are stowed safely when you are travelling. Ensure that your handbag and other mobile items are adequately covered. Remember, if you lose your valuables it will cost you a lot of money to replace them if they are not properly insured. Remember to also keep your valuables in safe places.
- Britz is chief actuary at Momentum Insure
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