rbsINSIDE - Volume5

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					                               boundless versatility                                                     INSIDE
                               to the summer edition
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                               of our RBSINSIDE
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                           With this change in the seasons, you’ll also note a change in our branding.

                           For Risk Benefit Solutions, the new change to RBS is a progression and evolution in the name by which we have
                           become known by many clients and insurers for some time already. So now we’re merely making the change official
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                           and – at the same time – creating a new-look logo.
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                           The heralding of this new season has also seen many other exciting developments in our company. One of these is
                           that RBS has recently acquired majority shareholding in Fairsure Fund Administrators, the two entities having enjoyed
                           a close working relationship for over 10 years. This development is in line with the RBS decision to grow its operation
                           from a specialised short-term insurance operation to a brokerage that offers a much wider range of financial services
                           and products.

                           We now have four new divisions in our group:
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                             insurance and risk services                employee benefits             wealth management                        health
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                           We look forward to sharing details of our extended product range with you in the very near future.
                           As the festive season draws nearer, we’d like to take this opportunity to wish you and your loved ones
                           a peaceful and rewarding year’s end.

                           INFLATED VEHICLE PREMIUMS
                           You may have recently seen the press highlight the necessity of reviewing your vehicle
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                           values at each renewal, and the effect it has on your premiums. We at RBS can assure you
                           that it is common practice to do exactly that at each renewal. We update each vehicle’s
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                           Retail Value according to the latest Auto Dealers Digest.

                           Rio-style Carnival for Cape Town
                           Cape Town is to get its own Rio-style carnival, with elegant balls, a street parade with floats and thousands of
                           performers. The announcement was made by Mayor Helen Zille, who said the first event was scheduled for 12 to 14
                           March in 2010 – the weekend between the Cape Argus Cycle Tour and the Two Oceans Marathon.
                           The theme for the inaugural 2010 carnival is “Rhythm, Roots and Boots.”
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                           Festive-season Increase – Fraud Will Cost
                           Short-term Insurance Industry R2 Billion
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                           Annually The risk of business fraud is very real in South Africa. Fraud is expected to cost the SA
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                           short-term insurance industry around R2 billion per annum – with the prevalence of fraudulent claims on the increase.
                           Coface operations manager Jacqui Jooste says businesses are not doing enough to prevent fraud. “We believe
                           companies have no option but to treat fraud as one of the most significant business risks facing their organisations
                           – especially considering today’s economic environment,” she continues. “The topic of fraud is diverse and large and
                           can include fraud by employees, policy holders and syndicates.”
                           As individuals and businesses come under more pressure because of higher interest rates and inflation, incidences
                           of fraud are likely to increase.
                           Types of fraudulent activity include:
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                           ∑        First-party fraud: Someone applies for and accepts credit with no intention of repaying.
                           ∑        Third-party or ID fraud: Someone uses another person’s identifying information.
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                           ∑        Fraudulent credit limits: Someone fraudulently obtains credit limits on behalf of large and reputable companies
                           by acting as a representative of those companies and using false company letterheads and contact details. Such a
                           person then opens accounts in the name of the companies and sells – and often collects – various goods.

                           Piracy Pushes up Maritime                                           House Prices
                           Insurance Costs
                                                                                               Drop Again
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                           South African shipping companies say the surge in sea-
                                                                                               The outlook for South
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                           piracy cases has left them saddled with higher maritime
                                                                                               Africa’s housing market
                           insurance and transport costs; insurance costs have been
                                                                                               for the near future is
                           rising to the point where some ship owners have refused
                                                                                               dismal, with statistics released
                           to sail their vessels in pirate-infested waters.
                                                                                               yesterday showing house prices rose at the slowest
                           Most piracy incidents occur in the Gulf of Aden, which lies
                                                                                               pace in more than 15 years last month. Higher interest
                           between Somalia and Yemen and links the Red Sea with
                                                                                               rates and record inflation crimping consumer spending
                           the Indian Ocean. Other piracy hotspots include the sea
                                                                                               contributed to this gloomy situation. Nominal house
                           off Nigeria, Tanzania and Brazil, around Indonesia and in
                                                                                               prices advanced at an annual rate of 1.2% last month,
                           the Singapore Straits.
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                                                                                               the slowest pace since January 1993, after regaining

                           In some of the robberies – 14 piracy incidents have been            a revised 1.7% in September. After showing a modest
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                           reported in one week – pirates have kidnapped crew                  increase in September, Standard Bank's median house

                           members and then demanded exorbitant ransom monies.                 price fell back by 2.5% year-on-year in October. The

                           Some insurance companies have resorted to paying the                median house price in level terms was R580 000, the

                           ransoms – these sometimes running into a couple of million          same as in August. It is the reduced affordability of

                           dollars – to recover cargo and vessels.                             housing – exacerbated by higher mortgage rates, high
                                                                                               food and fuel prices and a slowing economy – that has

                           Over time, insurance companies may have to “load” or add            led to a decline in the demand for residential property

                           extra premiums to cover their exposure to piracy.                   and a substantial softening in house-price growth.
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                           Restaurant Sued for R1 Million
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                           A Milnerton, Cape Town, businesswoman is suing the Blowfish Restaurant at
                           the Dolphin Beach Hotel in Bloubergstrand for more than R1 million in damages
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                           for neck and back injuries she suffered when a tent-canopy pole fell on her
                           while she was lunching there.

                           The parties appeared in court, since the restaurant had brought an application
                           for Bernice van Eck, the complainant, to provide certain documents relating
                           to her claim. The application was withdrawn, however, because Van Eck
                           complied with the restaurant's request for more information.
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                           The restaurant denied negligence. It said in papers that, if the court were to
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                           find it had been negligent, then Van Eck had also been negligent, since Van
                           Eck had "contributed to her own injury . . . by failing to keep a proper lookout
                           for any sign of the pole falling," a statement read. The restaurant was not liable
                           for any injuries because there was a sign at the door warning customers they
                           would "enter at own risk".

                           Van Eck, 37, of Royal Ascot Estate, Milnerton, had been lunching at the Blowfish
                           on 26 September 2006. A pole struck her on the back of the head and neck
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                           while she was eating. She believes this happened because the restaurant had
                           failed to ensure the canopy poles were firmly secured.

                           She was evaluated for a medico-legal report on 5 October of that year. The blow caused concussion, a brain contusion
                           with possible bleeding on the brain, severe neck pain and spasm and back-muscle spasms, the report, by physiotherapist
                           Annelise Swanepoel, said. It stated a brain scan showed Van Eck's brain was bruised and there was possible bleeding.

                           Van Eck is claiming R1 037 952. The matter is to be heard on 26 November next year.
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                            QuickFACTS                                               boundless versatility
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                             PORSCHE EARNS RECORD PROFIT
                             Porsche has made a record profit – not from the sales of its luxury sports cars but from a carefully planned takeover
                             of Volkswagen, which earned it almost 8 Billion Euros.
                             A I G ’S L O C A L U N I T P O S T S P R O F I T
                             American International Group (AIG) South Africa has posted a 63% increase in third-quarter profit of R63.7 million –
                             despite its US parent company making a third-quarter loss of R24.4 billion, it said yesterday. Wayne Abraham, Chief
                             Operating Officer, went on to say it was business as usual for the local operation.
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                                                                           boundless versatility

                                                                                          Fidentia Leads
                                                                                          to an Overhaul of
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                                         employee benefits                                the Umbrella Trust
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                           Protect Your                                                   Industry
                           Retirement Savings                                             In January of next year, beneficiary funds will come
                           In order to ensure that your retirement savings meet           into existence and replace umbrella trust structures.
                           your retirement goals, it is important that your               The new beneficiary funds will be responsible for
                                                                                          the management of benefits payable to
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                           contributions to a retirement fund achieve a real
                           return over your working life. Expected investment             beneficiaries of retirement-fund members who die
                                                                                          before retirement age.
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                           return and risk are, however, related.

                           The higher the expected investment return, the                 Previously, umbrella trusts were not regulated, as
                           higher the level of investment risk that usually needs         they did not fall into the definition of a retirement
                           to be taken. However, as you near retirement age,              fund within the Pension Fund Act. The Act has
                           volatility (or risk) in your accumulated retirement            subsequently been amended due to the
                           savings is less desirable, as you have less time to            weaknesses exposed by the Living Hands
                                                                                          Umbrella Trust being mismanaged by Fidentia.
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                           recoup any losses from a market correction. As a
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                           result – as you approach retirement age – you
                           should reduce the volatility in your investment                Service providers of beneficiary funds will now be
                           portfolios.                                                    required to register with the Financial Services
                                                                                          Board (FSB). The reporting and compliance
                           The Target Lifestyle Retirement (TLR) portfolio offered        required are very strict and will allow the FSB to
                           under the RBS Quantum Elite Pension and Provident              monitor the administration and investment of funds
                           Funds does just that. The TLR portfolio is designed            closely.
                           to reduce investment volatility gradually over a
                           10-year period prior to your normal retirement age
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                           As each of the individual portfolios is made up of
                           a blend of different investment managers or is multi-
                           managed, single-manager investment risk is
                           diversified. It also allows for underperforming
                           managers to be dropped from the product and
                           new managers appointed – with no disruption to
                           the TLR portfolio.
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