Given the magnitude of the losses suffered due to the recent civil unrest, violence, and looting, Sasria will be applying a rate increase to specific classes of business with effect from 1 January 2022.

Domestic dwellings have not been affected. However, the basic F2 – Fire Commercial rate on commercial buildings has been increased to 0.02906% (from 0.0174%).

A new category ‘F2 – Fire Commercial (Office)’ has been introduced for commercial buildings occupied as offices with a lower rate of 0.02088%.

1. Classes with no rate increase
   
   Sasria conducts an annual rate review and factors loss patterns over a number of years. The recent catastrophe event losses were considered, but they are not the basis on which the increases were determined. The affected lines of business have traditionally been affected by high frequency and severity claims. Lines of business that have not portrayed an increase in losses over the past 3 to 5 years are excluded from the increase and therefore, we are not increasing rates on the following classes of business:

• 1.1 F1 – Fire Domestic
• 1.2 F1(T) – Tertiary Institutions
• 1.3 F4 – SME Product
• 1.4 M1 – Cars, Private Use
• 1.5 M4 – Motor Ferries & Traders
• 1.6 MON – Money
• 1.7 Various BI Classes
  

2. Structural risk rating changes
   
   M2 (Light Commercial Vehicles) and M3 (Minibuses/Taxis)
   The rate review indicated the need for a change in structure of M2 (Light Commercial vehicles) and M3 (Taxis). These classes are currently rated at a flat rate of R45.39 per annum and henceforth will be rated on a rating scale in order to price the risk on the correct value at risk to Sasria.
   
3. New rating class
   
   The claims volatility on municipalities has warranted a review on the rating structure for this risk. Sasria is therefore, introducing a new rating class “MUN” specifically for all municipal-related risks to be added with its own risk profile.
   
4. Separation of F2 (Fire commercial)
   
   The F2 (Fire commercial) class of business is among the hardest hit in terms of severity of claims. However, the rate review exercise has shown that the risk within “office premises” exhibits a different risk profile to the rest of the fire risk. As such, Sasria will introduce a separate rating structure for F2 (Fire commercial – Office). This rate is exclusively applicable to commercial Office Premises risks.
   
5. Applicability of the rate increase
   
   The new rates become effective on 1 January 2022 (Inclusive) as follows:

• All new business
• Monthly policies on their annual anniversary date
• Annual policies on their annual anniversary date

The following are the new annual increased rates:

The below is an illustration of the Rate Review Impact on premium per annum exclusive of VAT.

Download the announcement circular