Uncertainty prevails in the insurance industry where the continued downward adjustment of global trade growth has not been helpful for marine cargo underwriting.Mike Brews, director at Horizon Underwriting Managers, said while premiums had seen a modest upturn in the past year, this had been from very low levels and the insurance industry remained under pressure – especially in light of the complexities and challenges faced in the maritime sector.According to Brews, fraud remains one of the biggest challenges underwriters face in these tight economic times.“We are keeping a very close watch for fraudulent claims,” he said. “It is a trend that picks up in tight economic times. Fraudulent claims, whether exaggerated or even non-existent incidents, are seen more f requently.”Brews said vigilance within insurance companies was extremely high, especially in the current economic climate. “Many times it seems like an easy way to get a few more rands out of the insurance company or to squeeze the claim just a little bit, but it is a criminal offence and it is not taken lightly.”He said insurance companies like Horizon were very aware of these practices. “People found guilty of these fraudulent practices risk going to jail as most insurance companies will do everything in their power to prosecute should they come across it.”The high incidence of theft in the local market also continued to pose some challenges – as did the impact of the high number of protests across the country.“There have been a lot of cargo issues – especially between Durban and Johannesburg – although not limited to that area following the many municipal service delivery protests, violent xenophobic attacks and just a general scourge of unrest. These situations have been much harder to manage and control, and the impact on cargo has been unpredictable.”Advising companies to opt for reputable service providers at all times, Brews said it was critical that cargo owners assessed risks as best they could, making sure cargo was optimally protected at all times.
INSERT: The high incidence of theft in the local market also continues to pose some challenges.– Mike Brews