Real house prices could slide through 2010 too

There's been talk of a recovery, talk of the end of the recession... is it possible? Or are we still a long way off?

According to Absa's House Price statistics, there is a possibility that we will still see house prices falling into 2010.

It's a wait and see game I guess. And it's not fun if you are in the position of wanting to to sell your property, or worse, if you HAVE to sell.

With inflation bound to increase again next year, and banks still being very cautious in their lending, I personally think it will be a while before we see some growth in residential property prices.

Read this article from FAnews :. South Africa's Premier Financial and Advisory News & Information Portal

National Health Insurance - The ANC way

I have been following the National Health Insurance (NHI) debate from a distance, as it doesn't directly affect my market, but am starting to pay a lot more attention to this now. The ANC's decision to push ahead with NHI directly affects each and every one of us in South Africa. Especially the "Haves" - those of us who pay income tax.
 

The unofficial guidelines contain the following phrase: “The system will be based on two principles: the right to health which will mean health services will be free at the point of use and social solidarity, where the rich will contribute a percentage of their income to fund health services for the poor.”

It's back to the days of Robin Hood, if you ask me. We are already paying taxes which is supposed to be used to fund government hospitals and healthcare facilities.

The NHI proposals were designed by the ANC, not by the government, and a rough draft was published on the ruling party’s website, not on that of the Heath Department. The actual policy document is still not available, but when it is eventually released, input and discussion will be requested from an advisory committee made up of 23 representatives from government departments and stakeholders. This seems to be an attempt to get input only from those that are most likely to give the plan the 'thumbs up'. 

 

An article published in the Financial Mail (FM) stated that “…there is no financial modelling or rand estimates of what an NHI system would cost.”
 

So the NHI gets driven forward by the politicians, who, in my humble opinion, don't seem to have done the maths, and are not interested in the opinions and input of those who will be burdened by the cost of the system, but are willing to consult with those who will most likely give them the answers they are looking for.

Is this a fair process? I'm not sure.

Cars may one day mimic fish to avoid collisions - Imagine how that will impact on an insurance company's losses

Cars may one day mimic fish to avoid collisions

Can you imagine a world where cars avoid bumping in to one another? "Never in South Africa!" I hear you say.

Maybe not, but that's exactly what engineers at Nissan are working on. It's fascinating to watch a school of fish swimming in a given direction, then suddenly they all change direction as if it was a well choreographed piece of dance. We can learn a lot from nature indeed.

Now, imagine the savings to insurance companies, as well as to you and I if our cars were smarter and avoided those bumper bashings. I can think of a couple of clients who would jump at the first chance of having this technology installed!


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Santam tops the charts again

Now how is this for a year of achievements?

Santam, has been named as the Best Large Company to work for in South Africa -according to the Deloitte Best Company to Work For survey.

Now you may think that's not such a great achievement. But, coupled with Santam's recent clean sweep at the FIA awards, where Santam was voted as the country's top insurer in all 3 categories: Personal, Commercial and Corporate, then it is clear that the guys with the yellow umbrella are doing something right.

Another reason why more than 70% of my personal and commercial clients are insured with Santam. Peace of mind, I reckon.

Murder and most contact crimes down in latest crime stats

Murder and most contact crimes down in latest crime stats:
"The number of murders committed in South Africa has continued to drop, but house robberies have increased by more than a quarter, according to Police Minister Nathi Mthethwa.

Releasing the police's crime statistics for the 2008/9 financial year, Mthethwa said contact crime - the form of crime generally associated with violence - currently accounted for 32.7 percent of all crime and that there had been a decrease in five of the seven contact crime categories."

While this is good news (in a way), we are still a long way away from the improvements that we all wish to see. A 27% increase in house robberies is quite alarming!

Making sure that household insurance is in order must be a priority for all of us, at least with the correct insurance you can be sure you will get your things replaced. Remember your household goods must always be insured for their FULL REPLACEMENT value, in order to avoid being under-insured.

Untitled

According to a KPMG suvey, the deterioration of the South African economy during 2008 has had an adverse effect on the financial performance of the insurance industry.

The short-term insurers that participated in the survey, which is representative of the industry as a whole, collectively reported gross written premiums of R51.0 billion for 2008 which compares to the R46.7 billion reported in 2007.  This represents a 9.2% increase. 

"When the premium growth is compared with consumer price inflation of 11.5% and a gross domestic product of 3.1% during the same period, it is clear that the short-term insurance market has shrunk in real terms during 2008," says Gerdus Dixon, National Insurance Industry Leader at KPMG. "This is a worrisome statistic."

The full article is here

Posted via email from Shane's posterous

R1000 a month to commute - and coming soon

Travelling between Jhb & Pta daily? Get ready to spend an extra grand a month on tolls - starting in 2011.

R1000 a month to commute - and coming soon

via Motoring on 9/10/09

Automatic freeway tolling is about to hit South Africa at 50c/km - or roughly R1000 a month to commute from Johannesburg to Pretoria, reports RAY LEATHERN. Can YOU afford that...?

Posted via email from Shane's posterous

CMS critical of Medical Schemes Brokers

It is somewhat worrisome that the financial services industry, and intermediaries in particular, are coming under so much fire lately. Especially when the majority of brokers add value and provide an important service to members of the public.

And then we have a regulatory authority, like the Council for Medical Schemes, publicly criticising brokers, and in my opinion, generalising that brokers are not offering valuable services.

The monthly commission payable to medical schemes brokers is a paltry R60 per member, and has not been increased to cater for inflation this year. However their expenses such as compliance and licencing costs increase every year. Fair? I think not.

FINANCIAL INTERMEDIARIES ASSOCIATION OF SOUTHERN AFRICA

MEDIA STATEMENT

Thursday, 3 September 2009: Comments by the Registrar of the Council for Medical Schemes (CMS), Patrick Matshidze, about the conduct of healthcare intermediaries have drawn strong criticism from the Financial Intermediaries Association of Southern Africa (FIA) and intermediary community.

At yesterday’s launch of the CMS’ latest annual report, Matshidze stated that there is “particular concern about the presence of unscrupulous medical aid brokers who render non-value services.”

Says Linza van Aswegen, chairperson of the FIA’s Healthcare Benefits Committee: “While this may hold true for the minority of healthcare intermediaries, this is not the case for the majority of financial advisors in the industry who work hard to add value and offer a meaningful service to thousands of consumers. It is unfair to make such a generalisation and one which could mislead members of the public to believe that all intermediaries are under suspicion of poor conduct.”

The value that the healthcare intermediary adds to medical scheme members and prospective members should not be underestimated says van Aswegen.

“Medical schemes are fraught with technical terminology, complex terms, limits and different benefits, a wide range of codes that are allocated to various medical procedures and many other components which only a specialist in this area will be able to interpret and explain properly,” she says.

The FIA also wishes to clarify Matshidze’s reference to high broker or intermediary commissions.

For several years now, commission has been regulated by the Minister of Health and is limited to R60,70 plus VAT per member per month or 3% of the monthly contributions to the scheme plus VAT. The maximum amount per member has not yet been adjusted for inflation in 2009 (an increase is allowed for in legislation).

With regard to the prevailing misperception that intermediaries churn policies in order to bolster their commission, the public should be made aware of the fact that in instances where a medical scheme member transfers from one scheme to another, the commission due to the intermediary from the original scheme ceases to be paid altogether and payment is then picked up by the new scheme. “The intermediary does not benefit financially by moving a member from one scheme to another,” says van Aswegen.

Intermediaries are subject to a code of conduct outlined under the Financial Advisory and Intermediary Services Act, while healthcare intermediaries are also regulated by requirements set out by the CMS. In addition, all members of the FIA are bound by a strict code of ethics.

“FIA intermediaries are committed to assisting the consumer to make informed decisions regarding medical schemes and health insurance products,” says van Aswegen.

-ends-

Banks' plan to fight ATM crime

Banks' plan to fight ATM crime: "Bank card-related crimes are down but still more can be done."

• While card fraud figures show a downward trend nationally, criminals continue with attempts to defraud banking clients

• Counterfeit card fraud remains a prevalent fraud method

• Skimming of cards with handheld skimming devices at ATMs is on the increase

• Members of the public are advised to guard cash safely after making ATM withdrawals to avoid being robbed

Standard Bank relaxes lending criteria

Great news for consumers looking to buy their 1st home!

Standard Bank relaxes lending criteria: "Makes it easier to get jump start bonds and ups bad debt ratio on credit cards."

New tobacco laws come into force

One good thing the SA government has done lately! Although I fear 'policing' it may be a challenge though.

It is now illegal for adults to smoke in a car where there is a child under 12, and smoking is also illegal in "partially enclosed" public places such as covered patios, verandas, balconies, walkways and parking areas.

New tobacco laws come into force

via Mail & Guardian News Feed on 8/31/09

Two pieces of legislation that dramatically increase smoking fines and crack down on tobacco companies have been signed into law.

Posted via email from Shane's posterous

Santam H1 profit up

Santam H1 profit up: "As investment returns recover."

How to lose a bonus

A future client of mine came to me with tears in his eyes this morning. Ok, that's a little dramatic, but he was really miffed, to say the least. I call him a future client, because he isn't a client of mine, but he will be very soon.

He is currently insured with a direct insurer. You know the type that promises bonuses if you don't claim? Ok.

Now, our hero, has been waiting for his cash back bonus for about 3 years and he was absolutely certain that it was due this week. He eagerly checked his bank statement... nothing. So eventually, when he couldn't wait any longer he called the insurer's call-centre, only to be told he has to wait another 2 years.

They explained to him that when he insured his wife's car, about a year ago, the car was inspected by an auto glass company. Round about the same time, they repaired a small chip on her windscreen, which they duly claimed from his insurance. So, his insurer regards that as a claim, and his 3 year period until the cash back bonus starts all over again.

So his R200 windscreen repair claim cost him about R3'500 in a lost bonus.

So, is a cash back bonus really all it's cracked up to be? Is it really worth waiting 3 years to possibly get something out? Whilst all along, our hero could have saved on his monthly insurance premium instead. But he waited for a bonus that he didn't get!

If it were me, I'd rather save every month than wait for a possibility of getting some cash back 3 or 4 years down the road. And let's be honest, this is South Africa. We have arguably the highest road accident and crime statistics in the world. What are the chances of not claiming for 3 full years? Not very good.

Who stole me?

Seriously... Identity theft is becoming a major problem here in South Africa.

I had a client call me last week, she had just applied for vehicle finance, and had also just been informed that her finance had been declined due to a bad credit rating. Now, that's where things get interesting. She hadn't applied for credit since early 2007, and then she had no problems.

But someone had after that... on her ID number, and they had run up a bill of R25k on a credit card and about R7k on a clothing account. Needless to say, they aren't paying those accounts!

So how do you get this mess sorted out? With great difficulty and a whole deal of red tape and all the associated bureaucracy, that's how. Including police case numbers, filling in dispute forms, lodging complaints, holding on for 2 hours in the credit bureau automated telephone system, time off work and so on.

Fortunately for my client, she has Identity Theft cover on her household insurance policy. It should make the experience a bit more bearable, not pleasant, but bearable.

What does this say about the state of our country?

I can't believe this all happened to one person!

I got a call from one of my clients today: She owns a couple of properties, 2 of which are unoccupied at the moment. Over the weekend, the one property's external copper pipes were stolen, along with the taps. This is in a suburb on the Kwa-Zulu Natal Coast of all places!

At her other property the doors were all stolen as the tenants had not moved in yet. For goodness sake, where else on earth could this happen? Only in South Africa! I can't believe it.

It says a lot about the state of our country, the crime, the poverty and the desperation.

Beware of Online Criminals

Nobody is safe thesedays -- not in the real world, nor online! Cyber thieves are getting smarter all the time - check out the article below, which was published on Personal Finance.

You need to be on your guard even more so than before when you bank online or respond to emails, because fraudsters are becoming more sophisticated and harder to spot. 

A Personal Finance reader became a victim of phishing (a form of internet fraud) last week, when she received an email - purportedly from Absa - that asked her to click on a link in the email and confirm her internet banking details. 

"It was so real that I even received two messages on my cellphone when the link took me to what looked like the Absa website - one with a verification number usually sent to me by the bank so that I can log in and the second to tell me that I had logged on for internet banking," she says. 

The unsuspecting woman updated her details, logged out and forgot all about it. But an hour later, she received a call from Absa's forensics department alerting her to suspicious activity on her account.

The account was suspended immediately, but it was too late - criminals had already taken R25'000 from her credit card account. 

Christo Vrey, the managing executive of Absa's digital channels, says based on the bank's initial investigation, it would appear that the phishing email led the woman to a fraudulent website (which did not have the padlock security icon or the valid address of Absa's banking website). The criminals used the information she entered on that website to log into the woman's bank account.

The criminals began a transaction that automatically resulted in Absa sending the verification number and the notification of online banking activity to the woman's cellphone. The criminals sent the woman a second email that asked her for the verification number.

The woman thought the email really was from Absa and replied to it, providing the criminals with the number. The criminals used the verification number to increase her credit limits and to defraud her.

If you respond to such an email and provide criminals with the verification number, they have complete access to your account.

"No bank would ever send you a letter or email requesting you to update or verify your log-in details," Vrey says.

What to watch out for

Alarm bells should start ringing if you receive an email that: 

 Contains a threat that your account will be suspended or closed if you do not immediately provide your personal information.

 Solicits your participation in a survey that requires you to divulge your personal information. 

 Asks you to submit your user identity, password or bank account numbers in an email or on a non-secure web page. 

 States that your account has been compromised or that there has been third-party activity on your account, and requests you to enter or confirm your account details.

If your account has, in fact, been compromised, your bank will contact you directly by phone; it will never ask you to confirm your personal identification number (PIN) or security details. You should never disclose your PIN to anyone, even if they claim to work at your bank. 

 Asks you to confirm, verify or refresh your account, credit card or address information. 

If you are sent an email purporting to be from a bank and you follow a link in the message, check the address line in your browser before you enter any information. 

The Personal Finance reader who was defrauded followed a link that read www.absa.co.za/absacoza, but when she went through to the website, the address line read http://alertnowonline. com/ www.absa.co.za/ absa update/ new%20absa/ib. jsp%0d%0a

The address line should have alerted the reader that the website was fraudulent.

Fraudulent websites are often close replicas of bona fide bank websites. Criminals may even create an illusion of authenticity by including links to the privacy policy on a genuine bank website.

If you suspect that your banking details have been compromised, you should immediately change your sign-on details - your user identity, PIN and password. You can do this online from your own computer or from a terminal at your bank. 

As an added precaution, you should notify your bank that you suspect that your personal banking details have been fraudulently obtained, so that the bank can monitor your accounts.

PS: Besides being careful, we suggest you take out Identity Theft insurance as well - contact us to find out more.

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