NEW HORIZONS FOR THE WILDLIFE FARMING INDUSTRY.

‘’At the end of possibly the most successful and vibrant trading year in the wildlife industry, Its time to take a step back, draw a breath and marvel at what has been achieved. New investors, together with the existing industry leaders in respect of game farmers, have spent hundreds of Millions of Rands on purchasing animals of various species, this in an effort to hopefully preserve the genetics of some of the most iconic animal species in Africa. Highest prices were paid for Buffalo, Sable and Roan antelope as well as what are known as ‘’colour variants’’ like Black Impala, Golden Wildebeest and Red Gemsbok/Oryx, to name but a few. Although under enormous pressure due to the poaching activity currently rife in Southern Africa, White Rhino held their prices well where they were sold and in some instances even archieved new S.A. record sale prices. This is surely an indication that the wildlife farmer is not ready to turn their backs on this persecuted species but to the contrary is making every effort to ‘’save the species’’ by actively farming and protecting Rhino to the best of his ability.

Trophy sized animals have become highly sought after by game breeders throughout the country, who are building up herds of meticulously cared for ‘’super stock’’ which is made up of animals of prime genetics and condition, this in an effort to enlarge the depleted gene pools of these animals, due to excessive hunting and lack of attention to natural attrition through old age and natural mortality, breeding programmes have been implemented with a view to sustainable progression of increasing quality of specific species. Demand has exceeded supply for these top breeding animals, which has inevitably pushed selling prices to new and in a lot of cases record heights.  Investors see very attractive returns for their money, with comparisons to the JSE indicating Sable and Buffalo stock over the past three years yielding returns anything between 25% and 45% more.

Some of the most jaw dropping per head sale prices achieved in 2013 were for:

White Heartwater Springbuck – R25.000.00.
Zambian Sable Antelope cow with calf – R2.3 Million.
Red Zebra mare – R550.000.00.
Roan Antelope cow with calf – R660.000.00.
Roan antelope bull – R1.4 Million.
Livingstone Eland heifer – R890.000.00.
Nyala family group – per head R42.000.00.
Black Impala ewe – R380.000.00.
Black backed Impala – R900.000.00.
Golden Wildebeest heifer – R500.000.00.
East African Buffalo heifer – R3.4 Million.
Bontebok –R60.000.00
Red Oryx Bull – R4 Million.
White Rhino Cow – R560.000.00.
Young Buffalo bull (4years) – R22.5 Million.
And last but by no means least, was a mature adult Buffalo bull which sold for R40 Million!
Besides the prices above, a new world record for the highest turnover ever recorded at a wildlife auction sale, was attained at the Thaba Tholo auction sale in Thabazimbi of R233.179.000.00.

A somewhat sad note saw the farewell of the father of South African wildlife auctions, Mr Willie Roux, who officially retired from the rostrum after 41 years of auctioneering and 49 years at the same company Vleissentraal. We all wish ‘’Oom Willie’’ a very relaxing and healthy retirement.

Here’s trusting that the forthcoming trading year of 2014, will follow similar trends to those of 2013 and that the wildlife  and associated industries will continue to add strength and contribute to the economic growth to our economy.’’



Julian Freimond
Director - Wildlife

MORTALITY INSURANCE – RISKS ASSOCIATED WITH ‘’AUCTION ANIMALS’’ WHILE IN BOMAS AWAITING SALE.

Possibly the highest risk in terms of animal well-being, can be apportioned to animals that are captured and held in bomas awaiting sale at an auction.  Stress and injury followed by exposure resulting in mortality in the short term, are the major contributors in this case .This would however be determined by many factors all critical to the outcome of this exercise and insurance rates are determined on the following basis:

 

1.Species – some species of animals are ‘’hardier’’ than others and adapt better to captivity and boma conditions, therefore less risk. An example is Roan which do not adapt well to boma confinement whereas Rhino and Buffalo generally do.

2.Veterinarian and capture team – the handling of the animals at capture, loading and off-loading as well as transport conditions are critical to their well-being.

3.Travelling distance and weather conditions – obviously major factors as unfavourable temperatures and rain as well as long periods standing and lack of bedding, feed, water and space are sure to reduce chances of survival.

4.Boma conditions are critical and factors to be considered when rating and considering a risk are – size and design of the holding pens as well as shade, protection from the elements and duration the animals are held in confinement. Strangely enough and depending on species involved, it is sometimes advantageous to house animals for longer periods in bomas prior to sale and relocation, than for shorter periods which can be unsettling. A good example of this would be Rhino which become habituated to boma conditions both pre and post-delivery and often then settle better in their new environment if held in bomas for longer periods before being sold and relocated.

Having consideration for all the above mentioned however, it still is generally considered less ‘’risky’’ for all species in terms of relocation, to be captured and relocated to their new environment directly, rather than to endure boma confinement between capture and delivery, even though in some cases, holding bomas are used at final destination to acclimatise the animals to their new surroundings before being released directly from the holding pens, into the veld.

Auction sales which offer animals for sale on ‘’catalogue’’, are almost always viewed by insurers as a better risk and mortality insurance rates will always be more favourable if cover is required for capture and transport to the buyers property directly, than for the whole procedure of capture, transport to auction site, boma cover, reloading and transport to final destination at the buyers property, however prices attained for animals on catalogue at sales are generally considered to be lower than those achieved for live sales where the animals can be viewed by the public/buyers, but there is obviously greater risk of mortality hence the higher rate charged.

When consideration is given to the risk at hand by insurers, there are a few options that are on offer. For full all risks cover which is sometimes subject to certain exclusions, depending on the underwriter and their policy wording a specific rate would apply and this would hopefully be ‘’all encompassing’’ as far as the owner of the animal is concerned. Buyers often just want to know that if the animal he is insuring dies, there is cover and insurance will be paid, although the polices available in the market are generally all encompassing, there are certain underwriters who exclude some perils and these need to be explained to any interested insurer – ‘’upfront’’ so that there is no misunderstanding. 

Exclusions in cover in terms of this class of insurance need to be clearly defined, explained and understood by the insured prior to the contract being concluded.

Alternatives to the above could be transportation risks only, capture risks only, cover while animals are in boma only, and cover from loading from the auction bomas to final destination or a combination of the above. Most wildlife insurance policies available are flexible and will tailor-make cover to suite the owner’s requirements. There is a growing tendency lately for the hosts of wildlife auctions to offer insurance for all animals sold on auction. This generally seems to include cover from fall of hammer, when the risk passes to the buyer, transport to the buyers property as well as a short period (7 or 14 days) on veld after delivery. This is advertised as ‘’free insurance’’ which should be catered for between insurer and seller and if advertised as such, should not involve any premium payment from the buyer. If however insurance is advertised as free or included with purchase, then no ‘’top up’’ or any additional payment should be requested by the seller in this regard. Some misunderstandings in this regard have led to disgruntled buyers who feel they were misled.

The financial impact of adding insurance premium to the purchase price of an animal can be further influenced by offers of additional voluntary excess, no claim bonus discounts, monthly payment for long term contracts and stop loss or limited loss cover which pegs insured limits to an agreed value of the total sum insured. For example if a total herd was valued at R10Million and the insured felt he had potential to lose a maximum during any one period of insurance, of say R2 Million worth of game, then the risk could be rated by most insurers on the R2 Million and not the total R10 Million value at risk.

Finally, it is worth bearing in mind for any readers of this article who may be owners of high value and exotic species of game, that it is sometimes necessary for brokers and underwriters to seek re insurance for animals with excessive values beyond normal mandates. These amounts or limits differ from company to company but usually around R10 Million in sum insured would necessitate additional participation from either an international or local insurer to take on risk exposure in excess of the mandated amount agreed to between intermediary and client and can sometimes take a day or two to negotiate, so timorous notice is required if cover is anticipated prior to purchase of the animal.

Travel Trade INSURANCE

PART 7
The previous six parts of this series, extracted verbatim (with slight editing) from the SATSA Insurance Directive booklet, were published in the December 2012, January, February, March, April and May 2013 editions – Editor.

TYPES OF INSURANCE
Basically there are five kinds of insurance that really apply to the tourism industry:

• Financial Guarantee (Insurance Bond) – Refer December 2012 edition
• Liability Insurance – Refer January 2013 edition
• General Public Liability – Refer January edition
• Passenger Liability – Refer January and February editions
• Road Accident Fund Amendment Bill – Refer March edition
• Personal Accident insurance – Refer April edition
• Professional Indemnity insurance – Refer April edition
• Vehicle  – Refer April edition / Property Insurance
• Travel Insurance / Medical Rescue  – Refer May edition
• Other Business Insurance (Buy & Sell, Key Person, Provident Fund)

OTHER BUSINESS INSURANCE
Part of being a business owner and breadwinner means making provision for unforeseen challenges. Risks associated with life assurance are not pleasant to think about, but they do play a significant role in your business and personal life. The results could be disastrous if they are not properly insured and managed.

All businesses have a unique set of financial requirements which need to be managed in times of crisis, and Buy & Sell agreements can provide reassurance as they provide a legal document that ensures that the business is not thrown into disarray if one of the shareholders dies or is disabled.  

Buy & Sell agreements preserve the continuity of business ownership and are designed to protect the shareholding of the partners or owners by providing the surviving shareholders with the funds needed to purchase the shares of the deceased shareholder.

Key Person cover is an insurance policy that is taken out by an employer to insure the life of a key individual within the organization. A key person is anyone within the business who significantly enhances profitability. The policy provides the finance that will be needed to recruit and train a replacement for the position that the deceased key person has vacated.
Businesses incur debt and shareholders generally have to sign surety for these debts, which creates both business and personal risks.

Personal Liability insurance transfers the risk by providing cover for sureties signed by the business partners in the event of the insured’s untimely death.
As a responsible partner and parent, it is important to be prepared for any eventuality, especially death and disability. Your family’s standard of living could suffer in the event of death, disability or dread disease of one or both of the breadwinners.  

Personal Life and Disability insurance cover provides the funds needed to continue supporting your family if you are unable to continue working due to illness or injury and ensure that major debt items such as home loans and car repayments do not cripple the family financially.
After a lifetime of hard work, retirement should be about enjoying a relaxing and well-deserved break but it can become a distant dream if the retirement funding that has been put into place is insufficient and basic needs cannot be met. Retirement insurance cover allows for the investment of small sums of money on a monthly basis to accumulate to the desired capital needed to ensure a financially stress-free retirement.

SUMMARY

This then largely covers the broader aspects of the insurances covering the tourism industry. In summary, a few important facts are worth repeating:

• Wherever possible make sure that your business is run as legally as possible. Don’t give a claimant any unnecessary ammunition to help bolster their case
• Always remain calm and provide the obvious humanitarian services to a client, that you yourself would expect to receive, were you in a similar situation
• Make sure that you are reasonably well insured for all eventualities. Don’t be pressured by horror stories and the threat of how a tourist will destroy you, but be prepared for the normal accident situation. Remember that many insurance policies overlap and you can be covered twice over in some respects
• Make sure that all accidents of any nature are reported to a relevant official authority
• Make sure that your policy covers you in all of the different countries in which you operate and for all the different activities that you conduct. In other words does the policy you bought in Cape Town cover you for the hippo attack that occurs in the middle of the Okavango Delta?
• Ensure that all your paper work is up to date. Try and make absolutely sure that your clients are aware of exactly what they are in for and that they sign acknowledgement of this fact
• Make sure that your vehicles are in the best possible condition that they can be. Don’t cut corners on safety measures
• Make sure that the literature promoting your business is factual and not misleading
• Never feel pressured to sign unreasonable contracts with agents that increase your liability and limit your rights to that of another country. You operate in Southern Africa and that is where you must fight your battles
• Select sub-contractors with care. As far as practically possible try and only use SATSA members. Should you use a contractor on a regular basis draw up a standard service agreement making them responsible for their product and giving you recourse in the event of non-performance
• When a foreign operator is selling your product from their brochure, or in fact even selling it without brochure inclusion, try and ensure that they are representing your product accurately. Wherever possible, proof-read and authorise any literature that displays your product before being bound by it
• Try and ensure that the gross price that your agent charges the consumer is a reasonable mark up and reflects good value for the service or product offered. If prices are high, client expectations are also high, and this often leads to conflict at the point of supply
• Beware of giving credit to agents who are ‘bad payers’. Many a time payment may be withheld in the event of a dispute and this puts you in a very vulnerable position. A financially weak agent may try and use a complaint as a reason for non-payment
• Make sure that your agents’ cancellation policies are in line with yours. Agents are under pressure to pay back deposits and return funds at the last minute, and this can leave you high and dry. However you must be prepared to share some responsibility and risk with your foreign agent, as they also have difficult parameters within which they work
• Don’t be bullied into refunding agents if you feel it unjustified. Make sure complaints are in writing and that you have had a fair chance to respond. Insist on receiving all correspondence and get the full picture. Proof of any refunds made by agents should be requested. Obviously when the complaint is genuine, act with dignity and try and sort out the situation as fairly and quickly as possible
• Above all, remember that your products or services are competing and being compared with those of all other similar products from all over the world. Ensure that your prices are competitive and that your service is beyond reproach.

Article taken from: http://www.tourismtattler.co.za/travel-trade-insurance-5/

SATIB Trust - Green With Envy Newsletter

Hi All

The SATIB Trust is a registered non-profit public benefit organisation (registered with
SARS) and the purpose of this media is to highlight, in our small way, the conservation
projects we support, either financially, logistically or by way of product donations.
This publication is “easy-reading” for the general public and people interested in
conservation in Africa! So, please pass it on – or better still, send us a note if you would like
us to email this electronic media to your friends or colleagues.
Please feel free to comment, participate or supply material and images for publication on any
conservation or wild life program!

Hope you enjoy our first copy of Green With Envy – Edition 2 for 2013 is scheduled for
August 2013.

Yours in conservation.

Brian Courtenay

Click HERE to view the latest issue of the Green With Envy Newsletter.

Tourism Indaba - a Great Success for SATIB!

Yet another Tourism Indaba down and from a SATIB perspective a great success! We are always fortunate enough to be surrounded by our clients and players in the industry for four days, all buzzing with excitement and the potential of securing additional business for the year. The Indaba, for us, is about being there for you, and indeed the industry as a whole, to show international buyers that Africa is serious about managing risk, that we manage a safe travel environment and that we have world-class risk transfer programs. It is also our chance to say thank you and have some fun!

This year SATIB put on a few well-attended functions:

·         ALOE Healthcare Insurance Super Sixes Action Cricket – six teams from around Africa battled it out for the coveted trophy. Proud winners this year the Victoria Falls team from Zimbabwe

·         Mind the Gap Seminar – just shy of 100 people attended our finger lunch and risk presentation on Saturday. This has now become an annual event at Indaba. Look out for our Johannesburg and Cape Town sessions.

·         SATIB Zulu Beach Bash – what a party! Many thanks to all who celebrated with us. See you next year.

SATIB must thank those who contribute to our success at Indaba and this year we’d like to highlight the following insurers: Santam, Interglobal, Marketform, QBE, AIG, Arch, H&L Underwriters, Guardrisk, RM Insurance Co and Tristar!

SATIB also attended HICA (Hotel Investors Conference Africa) for the two days prior to Indaba and we found this discussion platform to be most informative and very important for anyone interested in expanding his or her footprint or investing in Tourism in Africa. We moderated a session on Mozambique, which as many have realised is now showing some of the best potential in our sub-region for investors. A few industry leaders and SATIB clients were involved as panel members of various breakaway sessions. Thank you for the additional insight you gave. We certainly encourage greater participation by interested parties next year.

So from our side, a successful Indaba. We hope those who attended found benefit in the event and we wish you all (Indaba attendee’s or not) a very successful year further!

ARTWORK UNDERWORLD IS THRIVING

The theft of five paintings worth a total of R17.5-million from the Pretoria Art Museum earlier this year has put the spotlight on the intricate art crime underworld, where art is used to extort a ransom or hidden for decades and then sold on the legitimate market.

According to Gordon Massie, managing director of art insurance firm Art Insure, the stolen art is often destroyed by thieves who fear arrest when descriptions of their loot are splashed in the media.

Stolen artworks made of recyclable materials such as bronze end up as scrap.

Massie said the theft of art had become an epidemic plaguing Europe, North America and South Africa.

Art thieves are usually commissioned by dealers and collectors but Massie said that in some cases artworks are taken "on spec" in the hope of finding a buyer later.

"An item can be stolen and change hands three times within an hour, or it can be stolen and not seen again for many decades," Massie said.

Art Insure has a register of 103 artworks stolen in the past 10 years, including Alias Steyn's portrait of Nelson Mandela. Of the 103, only 28 have been recovered.

Massie said Italy has a fine-art squad of 95 detectives and in the UK a special police division deals with art crime. The Federal Bureau of Investigations in the US has a unit dedicated to art crime.

He laments that in South Africa, the under-resourced Endangered Species Unit of the police has to deal with this problem.

Captain Charmaine Swartz, one of four detectives in the unit, leaves at the end of the month. She said: "It's quite scary that we have this magnificent cultural heritage and we are not equipped to police it properly. We need more resources, more dedicated and passionate investigators.

Written by Gavin Courtenay
Managing Director
SATIB Insurance Brokers 

SATIB partners with InterGlobal to provide Aloe Healthcare Insurance plans in Africa

SATIB is proud to announce our partnership with InterGlobal to re-design the Aloe Healthcare Insurance plans to better meet the particular needs of corporate groups operating in the tourism industry in Africa. The Aloe Healthcare Insurance plans are marketed by SATIB, and they are administered and underwritten by InterGlobal.

The Aloe Standard and Comprehensive plans are designed to cater for the specialist needs of businesses operating in the tourism and hospitality industry in Africa who typically employ safari and adventure guides, lodge hospitality staff, maintenance teams and other employees who often work in remote wilderness areas and regularly come face to face with potentially dangerous game, including Africa’s ‘Big Five’.
Both Aloe plans are available for use throughout the African continent, allowing members whatever their nationality to move between African countries while maintaining full insurance cover. Employees can receive treatment at their choice of preferred hospitals or clinics, including evacuation to an appropriate medical facility for both critical and non-emergency treatment where adequate treatment is not available locally.
Aloe Standard provides cover for in-patient and daycare treatment as well as evacuation and repatriation benefits. Members of Aloe Comprehensive also benefit from cover for out-patient treatment, the maintenance of chronic medical conditions and extra cover for cancer care.
All members have access to the SATIB24 Crisis Call Centre, SATIB’s specialist unit which provides 24/7 incident management services in the event of a medical or personal safety emergency, even in remote, hard to reach areas.

We have gone to great lengths to ensure thorough coverage for our clients without exclusions or premium loadings for the typical activities and locations associated with tourism in Africa. Adventure activities such as cage diving, hot air ballooning, white water rafting and driving safaris are rarely covered by ‘off-the-shelf’ private medical plans. Coupled with the fact that our clients can benefit from cover throughout the African continent, they can be confident that the Aloe plans have been designed very much with them in mind.

. SATIB’s intimate understanding of the industry together with InterGlobal’s expertise in delivering international health insurance solutions on the continent has allowed us to provide exceptional yet affordable cover tailored for businesses operating in the African safari and tourist trade.
In addition to the ALOE products SATIB can offer InterGlobal’s Ultracare products which are more relevant to commercial businesses outside of tourism.

For more information contact:
Annitta Satyapreya
aloe@satib.co.za
+27 31 514 4200

OR your local SATIB branch office

Kind Regards

Gavin Courtenay

KIDNAP AND RANSOM COVER

Kidnap for ransom and extortion are becoming increasingly serious problems, especially in Africa and South America, and the average ransom demand has doubled in the last four years with some payment demands exceeding R400 million.  It is not only the rich and famous who are the potential targets of kidnappers but any foreigner who is perceived to be wealthy or who works for a big organisation with extensive resources.

Insurance against the risk of kidnap or extortion not only protects against financial loss but also provides the services of crisis management and security consultants to manage incidents on the policyholder's behalf. Kidnap and extortion insurance typically covers the following scenarios: kidnapping with a ransom demand; extortion – when payment is demanded following a threat to injure, kill, or kidnap an insured person; wrongful detention by a government entity or insurgent organisation and hijacking while traveling on any aircraft, motor vehicle or waterborne vessel. It is important to note that this cover includes the services of highly professional consultants who guide the negotiation process which can dramatically affect the outcome of a kidnap situation.

There are many expenses related to kidnapping and extortion which can also be covered. These include medical costs, rest and rehabilitation, travel and accommodation, loan interest, reward payments, interpreter fees and forensic analysis as well as access to a 24-hour help line.

Businesses who count high net worth individuals amongst their employees or send employees and their families to high risk areas should consider taking out insurance against the risk of kidnapping and extortion. 

Contact SATIB Insurance Brokers for more information on this type of cover.

Written by Gavin Courtenay, Managing Director, SATIB Insurance Brokers.

Nothing Moves without Insurance

Insurance is the industry on which all others are built, according to Jo Plumeri, Chairman and CEO of Willis Group Holdings plc in his address to The Insurance Conference 2012 held earlier this year. Plumeri noted, “Without insurance nothing flies, nobody works, nothing gets built, nobody moves, nothing moves.” The value of the insurance industry has been proved again and again after disasters such as Hurricane Katrina when the insurance industry honoured claims to the value of $34 billion.

The insurance industry must, however, constantly evolve to manage risks, both to business and persons, as they change. There are new threats in this day and age which people would not even have considered insuring against 10 or 20 years ago, for example, pandemics, terrorism and climate change which are all very real now. It may also be necessary to insure against damage to your or your company’s reputation, cyber-theft and a financial crisis in the 21st century, risks which weren’t even thought about a few decades ago.

A recent example of this comes from the raging inferno that jumped from house to house along the canals of Cape St Francis in November 2012. Officials said at least 100 homes in the coastal town were gutted, forcing scores of residents to flee their homes. Some 76 buildings were completely destroyed. Claims for this damage were way over R30 million. This does not include residents loss of income or any injury caused.

According to Pulmeri, Insurance brokers need to be forward thinking in order to ensure that their clients are still in business in five or ten years’ time by mitigating the risks facing their operations through comprehensive insurance.

Contact us to ensure that all possible risks you might encounter are covered.

Kind Regards


Gavin Courtenay
Managing Director
SATIB Insurance Brokers