PEP NEWS

NEWS ARCHIVES

THUMBS-UP FOR NEW TYPE OF INSURANCE

12 February 2007

NEWS RELEASE
It’s official:  South Africans have given the ‘thumbs-up’ for buying insurance over the counter in shops.  Every month an average 11 000 people are signing up for cash based, pre-paid starter pack insurance products, introduced just nine months ago.

Off the shelf, cash pre-paid insurance appeals to people who don’t have bank accounts, of which there are an estimated 17 million in South Africa.  Funeral, Personal Accident and Cell Phone insurance are the first three types of insurance to be retailed to a cash based market and were developed by Hollard and PEP. 

Through using the PEP distribution network, the intention was to meet the needs of the unbanked market by offering affordable and accessible insurance.  When customers speak to Hollard as they make a claim and receive their payouts, they have confirmed that they like buying insurance when they are shopping because it is convenient. 

Funeral policies are the most popular, accounting for 89% of the take-up so far and members feel secure that the commitment to paying claims is being honoured.

The PEP insurance starter packs cost R19.99 per month and contain a numbered insurance card that is bar-coded and has a dedicated insurance hotline number so that clients can talk to trained insurance professionals in their home language.  

Starter pack insurance was a South African first when it was launched and, at the time, some conservative thinkers voiced their doubts about whether it would be a success.  Born nine months ago and with 100 000 new starter packs sold across PEP’s counters throughout the country, not only should the critics now be silenced but it also looks as if this baby’s growing healthily.  In fact, PEP and Hollard forecast that 400 000 people will have purchased starter pack insurance products by the end of 2008.