Specialist warns against inadequate insurance cover

TAKING insurance cover without thoroughly assessing whether one’s precise requirements are properly catered for is rather like buying a pig in a poke, acquiring something without seeing it first hand, and a cause for grave concern in the insurance industry, says Aon’s Pieter Venter. The Cape Town-based marine manager for Aon South Africa, part of the giant Aon Corporation, Venter suggests certain types of insurance services such as marine liability and ship repair cover, for example, are not being properly serviced by the local marine insurance industry, mainly due to a lack of expertise in those areas. “Brokers, inexperienced in this niche market, do not quite comprehend the full scope of the exposures that their clients face. Aon is however fortunate, in view of its local and global presence, in being able to call in expertise in these areas.” Venter’s views are not confined to the broking fraternity, however, his belief being that many local insurance companies’ knowledge of these products is not up to scratch either. “The concern is that advice is often given, especially to small and medium-sized maritime companies, that they are adequately covered for maritime liabilities in terms of their standard commercial policy, whereas that is often not the case. “Companies are falling victim to products that appear to provide the cover required, often costing much less than a specialised product. It is however when a loss occurs that they are confronted with the reality that they will not be able to recover their full financial loss. Since these incidents are often the subject of legal action, the impact is compounded.” This is where Aon – a Gaelic word meaning unity or oneness – is able to developing products to provide the necessary protection through carefully selected insurers in the local market. “Much of the problem with resorting to the international community such as Lloyds’ of London, where most of the covers have been placed up until recently, is that the costs can be prohibitive. “If you place a risk overseas you are obviously rated on a pound or dollar basis so when converting premium by our exchange rates it clearly works out a lot less to the underwriter who is then often forced to charge an exorbitant minimum premium in rands.” In South Africa since 1996 and with branches in all the major centres, Aon offers marine insurance expertise at its Cape Town and Johannesburg