In a ‘best of the best' celebration held at the Sandton Convention Centre, Johannesburg, on 8 June 2017, the Financial Intermediaries Association of Southern Africa (FIA) announced the 2017 FIA Awards winners. The awards celebrate the financial services brands that provide the best product, relationship and service to the country's financial advisors and insurance brokers.
“Our 19th FIA Awards is not only a celebration of exceptional insurance brands; but an opportunity for us to highlight the value that intermediaries bring to the table by ensuring good financial outcomes for consumers,” says Lizelle van der Merwe, CEO at the FIA. She adds that the appointment of Ask Afrika as the 2017 FIA Awards survey partner was intended to bring the association closer to consumers who are recognised by the FIA as the most important component in all financial transactions.
The FIA Awards are fiercely contested and the winners are not only recognised as companies that go ‘the extra mile’ for South Africa’s insurance brokers and financial advisors; but those that truly have the consumers’ interests at heart. Awards are given in each of 10 categories to reflect the main financial advice disciplines that FIA members are active in, namely employee benefits, financial planning (life and investment); healthcare (health insurance and medical schemes) and short-term insurance.
Over the following paragraphs we will share the names of the #2017FIAAWARDS winners along with a layperson’s introduction to the sectors of the economy relevant to each of the FIA’s financial advice disciplines. Announcing the #2017FIAAWARDS winners In the field of short-term insurance
“Short-term insurance, referred to as property and casualty insurance in the US or general insurance in other country markets, covers individuals and businesses against accidental loss or damage,” says Gareth Stokes, Head: Brand & Communications at the FIA. “Your ‘average Joe’ will insurer his house, household contents and motor vehicle while a firm would buy insurance for assets (buildings, machinery and vehicles) as well as complex cover for business interruption and liabilities.”
The short-term insurance industry is a major contributor to the country’s GDP with millions of insureds contributing upwards of R120 billion in annual premiums to the sector – more than 80% of this premium is ‘introduced’ by insurance brokers. “Insurance, especially in the business sector, can be extremely complex – which explains why virtually all commercial and corporate insurance is advised by short-term insurance brokers and risk managers,” says Stokes. He adds that some two thirds of individual insureds prefer the advised route when they buy insurance because they understand that brokers have the necessary experience to assess their needs and to source appropriate cover at the right price.
When disaster strikes, the insurers step in, paying out upwards of R80 billion each year to put consumers back into the same position they were prior to a loss event. “Few people pause to consider a country without insurance; the reality is it would grind to a virtual standstill as banks remove financing from businesses and individuals alike,” says Stokes. The insurance brands that offer the best all round package of product, relationship and service to FIA member brokers are:
Short-Term Insurer of the Year – Personal Lines: Santam
Short-Term Insurer of the Year – Commercial: Renasa
Short-Term Insurer of the Year – Corporate: Santam
Underwriting Manager of the Year: Leppard Underwriting
In the field of life insurance and investments
“FIA members in the financial planning discipline advise their clients on a range of financial products, under the life (risk) and investment headings,” says Stokes. “Life insurance includes death, dread disease and disability and funeral covers; investment savings comprises monthly contributions to endowments, retirement annuities, unit trusts and tax-free savings plans; and investment lump sum includes single contribution retirement annuities, living annuities, and preservation funds.”
The importance of good financial advice becomes apparent when you consider the size of South Africa’s life and investment market. According to True South Actuaries & Consultants’ 2016 Insurance Gap Study, the life cover held by South Africa’s insured consumers stood at R20.365 billion; much of it originating from the intermediated distribution channel thanks to the tireless activities of employee benefits consultants and financial advisors. The Association for Savings and Investment South Africa meanwhile estimates total regulated household savings in excess of R9 trillion, including R4.4 trillion in retirement funds; R1.9 trillion in collective investment schemes; and R2.6 trillion held by life insurance offices.
“The life and investment universe is complex and mistakes in product selection or the timing and frequency of contributions to such products can make a world of difference to consumer financial outcomes,” says Stokes. He says that consumers should seek the assistance of an advisor to draw up a life financial plan as early as possible, thereby ensuring that their life and savings needs are considered. Financial advisors have a range of products they can turn to to implement the financial plan, with the brands that offer the best combination of product, relationship and support to FIA member brokers being:
Long-Term Insurer of the Year – Risk: PPS
Product Supplier of the Year – Investment Product Lump Sum: Allan Gray
Product Supplier of the Year – Investment Product Savings: Allan Gray
In the world of employee benefits
“Employee benefits products include umbrella products (retirement funds), risk benefits and investments for institutional groups such as a fund or an employer,” says Stokes. “This is a specialised area of financial advice typically performed by employee benefits consultants or financial advice practices.” An FIA member in this segment of the market will advise his or her client, the employer group, on the best mix of benefits for the employees of that group. The financial services brand chosen by FIA members as the best at product, relationship and service in the employee benefits market is:
Product Supplier of the Year – Employee Benefits: Sanlam EB
In the world of healthcare
“Although the cover offered by South Africa’s private medical schemes is hardly universal, we cannot ignore the 8.8 million beneficiaries who currently enjoy protection from 83 medical schemes,” says Stokes. There are 60 ‘open’ medical schemes where existing members are represented, and new members introduced, by medical schemes brokers. According to the Council for Medical schemes there are 2,214 broker organisations and 8,688 individual brokers in this sector, which collects around R151.6 billion in annual premiums.
“Healthcare brokers have a difficult task to keep their clients informed about a complex environment where scheme options, scheme benefits, designated service providers and prescribed minimum benefits are continuously evolving,” says Stokes. “Against this backdrop it is imperative that the medical schemes provide backup and support to FIA members.” In 2016 the FIA added another category in its healthcare section to acknowledge suppliers of gap cover plans; hospital cash plans; and/or primary healthcare insurance policies. The brands going out of their way to assist the FIA brokers in these categories in 2017 are:
Product Supplier of the Year – Healthcare: Momentum Health
Product Supplier of the Year – Health Insurance: Stratum Benefits
“The FIA would like to congratulate each of the finalists and category winners in the 2017 FIA Awards. Your performance is an acknowledgment of your commitment to the intermediated model of financial product distribution – and more importantly it underlines your promise to consumers that you will continue to deliver exceptional financial outcomes underpinned by good financial advice,” concludes Van der Merwe.