IIG News

IIG Insights: In Conversation with the Regulator

On the 27th of May Swiss Re sponsored a webinar on an engaging discussion with Suzette Vogelsang from the Prudential Authority on pertinent topics facing our South African insurance industry. Suzette focused on the impact of Covid-19, Climate Change and the Transformation journey of our insurance industry.

 

Suzette Vogelsang is currently the Head of the Banking, Insurance and FMI Supervisory Department in the Prudential Authority of the South African Reserve Bank.

Suzette’s current supervisory responsibilities include the prudential supervision, on both a solo and group basis (where relevant), of the small to medium size life and non-life insurance companies, small to medium size banks (including foreign branches), and the solo prudential supervision of Financial Markets Infrastructures (securities and derivatives only).

Suzette was also responsible for managing the team who finalised the technical requirements of the new risk-based solvency regime that was introduced into legislation in South Africa in 2018.

Suzette represents the Prudential Authority in various industry forums in South Africa. Suzette is currently the 3rd Vice Chair of the IAS Exco representing the emerging and developing markets. She is also the IAIS Regional Coordinator of the Sub-Sahara Africa region.

Machsie is the Chief Risk Officer for Swiss Re Africa Ltd. and the risk partner for the Middle East and Africa region. She is a qualified actuary with experience in insurance, reinsurance and consulting and has worked in South Africa and the United Kingdom.

Mulalo is the Legal Counsel and Company Secretary for Swiss Re Africa Limited and has been in the re/insurance industry for over 10 years. Prior to joining Swiss Re, she was an Associate at Norton Rose Fulbright South Africa, where she also completed her articles and qualified as an attorney.

 

Our MC Tshepiso Chocho welcomed the IIG members to a Swiss Re sponsored webinar. Tshepiso introduced Machsie who on behalf of Swiss Re briefly provided an overview for the webinar that would be given by Suzette the Prudential Regulator. Mulalo provided context with regards to the format of the webinar including that of using Slido.com to chat with the panelist and introduced Suzette to the audience. There were 3 main areas that Suzette presented on, COVID-19 response, Climate Change and Transformation and financial inclusion. Each topic was followed on with questions after which Mulalo and Machsie co-ordinated in getting them answered.

Suzette gave some insight into the happenings at the Regulator, the first of which was the response to COVID-19. These included the numerous communications to and from the various role players.

Her presentation gave a brief overview of the subject matter of these communications, that is, activities during the lockdown, premium holidays and payments to broker, premium collections, regulatory and supervisory relief measures, exemptions granted, business interruption cover. All of which aided the industry to navigate and provided much needed guidelines during these unprecedented times.

She further highlighted the immediate implementation of stakeholder engagement between National Treasury, PA, SARB Departments and FSCA and the frequency of these engagements.

In addition, we got insight into the various reporting requirements initiated to get a sense of where the industry was on matters such as, insurer operations, liquidity, and solvency risks as well as the impact of the pandemic was having on both large and smaller entities.

Several surveys were also conducted on the impact of COVID 19 on credit insurance (life) and business interruption cover (non-life).  The purpose of which was to analyse the Initial concerns around the impact of payment holidays, retrenchments and forced unpaid leave, and to understand the potential impact from insurers. The BI Contingency Cover Survey looked the significant business operations in SA that were interrupted due to COVID 19 and lockdown restrictions. Suzette further expounded on the BI policyholders anticipating potential claims and the different views between policyholders and insurers on the matter.

The result of these surveys was shared with us and gave informative statics of what was happening in the industry.  Further insight into surveys undertaken post the first Judgement on 26 June 2020 – Café Chameleon versus Guardrisk Insurance Limited and post the SCA judgement of Guardrisk Insurance Limited vs Café Chameleon – 17 December 2020 was provided. 

The COVID 19 impact on the industry was concluded by a discussion on the way forward which emanated from the BI Survey which included further engagement and monitoring between all stakeholders in the industry. 

In her presentation on Climate Change, Suzette briefly discussed it being a Top Global Threat and listed the many sectors that were being threatened by climates change. She noted the relevance to the Regulator and included some discussion on the physical risks, transition risks and the potential financial impacts. A discussion was provided on responding through supervisory practices and listed what the Regulatory and Supervisory Framework must include. A brief overview of international developments was provided to conclude this topic.

The last topic Suzette presented on was Transformation and Financial inclusion, starting with the objectives of the Act and the transformation requirements of AI, 2017. She further highlighted what model of transformation was envisioned in the areas of Licensing, Supervision and Development and the role the prudential regular must play. Her presentation was concluded by highlighting international developments on the subject.  

 

Machsie and Mulalo thanked Suzette for her time and insights into Covid-19, Climate Change and the Transformation journey of our insurance industry. The session ended by thanking Swiss Re for their sponsorship of this very insightful session.

 

Article Written by Suren Kasil

 

This IIG Insight was  proudly sponsored by:

 

 

 

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