MARSH SOUTH AFRICA
MARSH AFRICA
Finding the
Opportunity in Risk PRODUCTION: Timothy Reeder
A global leader in insurance broking and innovative risk management solutions, Marsh’s 30,000-strong team of experts advise individual and commercial clients of all sizes across 130 countries worldwide. In Africa, Marsh specialises in providing clients with the intellectual capital and industry experience to unlock the opportunity in risk.
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In today’s increasingly uncertain global business environment, Marsh is on hand to help clients to thrive by enabling them to anticipate, quantify and more fully understand the range of risks they face. On offer are services spanning risk management, risk consulting, insurance broking, alternative risk financing and insurance programme management. CENTURIES OF EXPERTISE Marsh is a wholly-owned subsidiary of Marsh & McLennan Companies (MMC), a global professional services firm with a revenue of USD$13 billion annually and 60,000 employees worldwide. Since 1871, clients from
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every industry, be they businesses, government entities, multinational organisations or individuals around the world, have relied on Marsh for trusted advice to represent their interests in the marketplace. Its long history gives Marsh, and its clients, the ability to make sense of an increasingly complex world, and help turn risks into new opportunities for growth. At its root, Marsh provides industryfocused consulting, brokerage and claims advocacy services, while leveraging data, technology and analytics to help reduce clients’ total cost of risk. Marsh uses a team approach to best provide for individual clients’ risk management and insurance needs; essentially, this means
that each partnership is overseen by a client executive, who draws exhaustively from industry and risk specialties to analyse, measure and help manage multiple risks. INDESTRUCTIBLE RELATIONSHIPS Also, pivotal to accomplishing clients’ goals every time are Marsh’s consulting, brokerage and claims advocacy services, all directed by colleagues who apply deep experience and knowledge of clients’ industries to result in broad-based risk coverage. “Our greatest assets in our business,” summed up Marsh Africa CEO Jurie Erwee in conversation with leadershiponline.co.za, “are our client relationships, which have been built around our clients’ needs.”
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//Get added peace of mind with Old Mutual Insure’s Construction Risks and Assets All Risk Getting the right cover for your construction and erection projects is important. Despite your best intentions, the transition period from the completion of the construction project to the handover of the assets is often a blind spot that many project managers miss. There is always a real possibility of incurring crippling financial losses due to unforeseen events during this stage, unless the correct insurance cover is in place. The construction contracting business is not for the faint-hearted due to the high potential for significant loss or damage. Regardless of meticulous planning, unforeseen developments such as loss or damage to the works under construction and the resultant expensive repair work can delay construction progress, with significant cost implications for the project and for the company. So how do project managers plug this vulnerability gap and ensure that their construction projects are still covered during this critical phase and beyond? As one of South Africa’s leading Engineering insurers, (with registered offices in Botswana and Namibia), Old Mutual Insure has developed a tailored solution that offers comprehensive, end-to-end cover to mitigate against any eventuality that may potentially arise during the construction phase until the project is handed over upon completion. Clients often opt for construction cover that insures their construction project against damage and accidents during the construction phase, and an assets all risk policy to cover the property when it is completed. The Construction All Risks policy will cover the principal, contractors and sub-contractors against physical loss of or damage to the works during the construction phase. Old Mutual Insure’s Assets All Risks policy will cover all property belonging to the client. This includes the actual buildings, immovable and movable machinery and equipment, as well as the business interruption following an indemnifiable fire loss to this property. The projects that the Construction All Risk can cover range from domestic dwellings to power stations. The policy also provides legal liability protection for the principal, contractors and sub-contractors in the event of injury to or death of a third party person or damage to third party property arising from the execution of the works. To give project managers an added peace of mind, the Construction All Risk cover can be extended to provide liability protection in the event of injury to or death of third parties or damage to property as a result of the removal, weakening or interference with the support of land or buildings in the vicinity of the construction site. It can also encompass added cover for unforeseen expenses including loss of rent or loss of profit arising out of construction delays. The construction site is constantly evolving as the project progresses. In an ever-changing, hectic environment with a large number of constantly moving vehicles and trades people, hazards are ever present. Overhead lifting equipment, supply vehicles and dump trucks are always maneuvering around the tradesmen, materials and structures on the building site, which greatly increases the chance of an accident. Once the project is completed and handed over, the property can be insured under Old Mutual’s Asset All Risks policy which will provide cover for physical damage to property at the insured’s premises. Cover can be extended to include Business Interruption, in the form of loss of profits or loss of revenue following a fire loss. By insuring your construction projects and property with Old Mutual Insure, you will have peace of mind that there will be no gap in cover when the property moves from the Construction phase to the Operational phase. With the myriad of ever-present obstacles that can derail a construction project, the project managers cannot afford the luxury of risking the financial viability of their companies and their reputation by neglecting to purchase adequate insurance cover. Covering yourself against multiple factors that can delay completion of a construction project shouldn’t be left to chance or luck. Old mutual Insure is an authorized financial services provider (FSP 12).
THE TIME IS NOW TO START BUILDING
We understand that getting the right cover for your construction project is important. That is why we provide insurance protection for physical loss or damage to the project and legal liability in respect of injury to or death of third-party persons or damage to third-party property during the construction phase. Your vision is our business.
INSURE DO GREAT THINGS EVERY DAY Old Mutual Insure is an Authorised Financial Services Provider (FSP 12)
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For more information, email Michael.Steensma@ominsure.co.za or visit ominsure.co.za
INDUSTRY FOCUS: INSURANCE
// OUR GREATEST ASSETS IN OUR BUSINESS ARE OUR CLIENT RELATIONSHIPS // Marsh SA’s CEO, Spiros Fatouros, expanded upon how important Marsh’s carefully tailored solutions are to its ongoing success. “A huge benefit to insurance broking is the advisory role we play in selecting or even creating a product to suit the specific needs of a client, and we pride ourselves on the advice that we provide,” he explained. “Marsh’s global footprint has taken over 25 years to build and allows us to service clients locally around the globe. People don’t often care if you’re the biggest, it’s always about the service you provide. “The real benefit of working with
Spiros Fatouros - CEO
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Marsh is the tailored local delivery that is leveraged off a global network of experts.” A MARKET RIFE WITH OPPORTUNITY According to the Oxford Business Group’s recent study, the South African insurance sector is, by many measures, one of the most advanced in the world. It has a premium-to-GDP ratio that is among the highest anywhere, and its insurers are well-regulated, wellmanaged and innovative, while it is also a market which is becoming ever more sophisticated through the introduction of new legislation. Conversely, it is in some ways not a mature market, given that much of the country is unbanked and uninsured or underinsured. Financial inclusion is limited, and even some basic policies are optional. For a company as well-run and organised as Marsh, this situation presents both significant opportunities and a number of key challenges.
According to Ralph Mupita, CEO of Old Mutual: “Expansion into the rest of Africa by South Africa’s big insurance players is driven by the nascent opportunity of insurance penetration and seeing a growing middle market that will need insurance products over time. “There are still a lot of growth opportunities in South Africa but growth rates are more attractive in the rest of the continent given the growth of the middle-income base, rates of urbanisation and nascent financial services.” UNLOCKING POTENTIAL These are untapped markets, both within South Africa’s borders and in the wider region, and present lucrative opportunities for those able to seize them. The question is, how best to tap them? Alternative economic and business news platform Ujuh identified at the turn of the year the five trends it felt would be central to shaping the South African insurance industry in the immediate future. Among these were regulatory changes and the increase in the frequency and severity of extreme weather conditions, but two aspects which Marsh has clearly taken to heart are the need of product innovation and effective application of the necessary technology. Ujuh states that, “insurers will continue working around the clock to develop innovative products that meet the ever-changing needs of customers.” Jurie Erwee explained how Marsh is so well-placed to capitalise on the abundant scope of the wider African market. “The spirit of innovation is firmly entrenched in our DNA,” he began. “Marsh has pioneered a great number of concepts including the birth of insurance broking in the 19th century. Africa offers a lot of promise long term and we are here to continue to invest. We will see a return on those investments as long as we continue to work through the challenges we face as a country and business collectively.
MARSH SOUTH AFRICA
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“In a fast-changing world, the industry will continue to evolve rapidly,” were the thoughts of Spiros Fatouros, as he recognised how far consumer needs have shifted even in recent years. “There is a real trend towards a demand-based economy rather than one of ownership. Ecosystems are changing and disruptors like Uber and Airbnb are changing the way consumers behave, which will no doubt have an impact on their insurance needs.” RISE OF CYBERCRIME Certain types of risk are becoming more and more prevalent, not least among them environmental and geopolitical concerns. Most pressingly, findings from a report in April from TheCityUK and Marsh indicate that cybercrime is now the number one risk for financial and related professional services firms. There
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is no escaping that company boards must do more to meet the challenge, and with the emergence of such risks Marsh is better positioned than anyone else to respond to negate the potentially ruinous consequences. Marcus Scott, Chief Operating Officer of TheCityUK, explained that, “cyber security is now a major risk demanding board-level oversight as companies find themselves under siege from cyber-attacks. In fact, for many of our members it may well be the biggest single risk. As well as mitigating against external attacks, boards must be aware of supply chain threats which could penetrate a business through internal channels. It’s essential for all boards to have robust governance systems in place to manage these risks.” In response to the emergence of cyber security as a top priority, Mark
Weil, Chief Executive Officer of Marsh UK & Ireland, concluded with how Marsh as a whole will do everything within its power to provide peerless protection. “While there has been much discussion on the technical aspects of cyber risk, little is said on what company boards should be doing to address this threat. Boards need to drive forward digital transformation to maintain their competitive edge, while ensuring they are resilient to the many forms of cyberattacks digitisation opens them up to. “We want boards to be able to have a ‘no regrets’ position on cyber, meaning that if a breach does occur, they know that everything reasonable has been done to minimise harm.”
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Published by CMB Media Group Chris Bolderstone – General Manager E. chris@cmb-media.co.uk Sackville Place, 44-48 Magdalen Street, Norwich, NR3 1JU T. +44 (0) 20 8123 7859 E. info@cmb-media.co.uk www.cmb-media.co.uk CMB Media Group does not accept responsibility for omissions or errors. The points of view expressed in articles by attributing writers and/ or in advertisements included in this magazine do not necessarily represent those of the publisher. Any resemblance to real persons, living or dead is purely coincidental. Whilst every effort is made to ensure the accuracy of the information contained within this magazine, no legal responsibility will be accepted by the publishers for loss arising from use of information published. All rights reserved. No part of this publication may be reproduced or stored in a retrievable system or transmitted in any form or by any means without the prior written consent of the publisher. Š CMB Media Group Ltd 2018
AS FEAT UR ED IN
ENTERPRISE AFRICA
SEPT EMBER 2018