Short-term insurance industry contributes to financial literacy education

Media release: SAIA FSC Consumer Education Initiative Report Back (2007)

7 October 2008

Short-term insurance industry contributes to financial literacy education

The South African Insurance Association (SAIA) today reported back on the short-term insurance industry’s consumer education initiative implemented in 2007/8 with 2007 financial year end funds. A total of R8 552 111.23 was pooled voluntarily by SAIA members in terms of their 0.2% commitment to consumer education in the financial services arena in terms of the Financial Sector Charter. This consumer education initiative was aimed at the lower income group or LSMs 1 – 5 and Black people as per the requirements of the Charter.

The SAIA also commended its partners in this initiative, the Financial Services Board (FSB) and the Life Offices Association (LOA), at this event held at the Protea Hotel in Midrand. The FSB contributed a total of R2 032.500 and the LOA R4 002 286.74 to the projects implemented in 2007/8.

“Financial literacy has received growing attention in both the developed and developing worlds in recent times. One just has to look at the current sub prime and subsequent financial sector crisis in the US and other countries to realize that financial literacy is important at all levels to assist individuals to make informed decisions about their finances,” said Mr Ronnie Napier, Chair of the SAIA Board, in his closing remarks at this event.

“It is therefore quite satisfying to be able to say that the SAIA and its members, together with the Financial Services Board as partner on 4 of our 2007 projects as well as the LOA as partner on the community workshop project, have been very active in the field of financial literacy education in South Africa for the last four years,” he added.

The projects implemented in 2007/8 were:

• A community workshop project aimed at specific communities within the target group during which financial education were facilitated, delivered by Inzala. A total of 23 088 people were educated at these workshops in all 9 provinces of South Africa. This is a project in cooperation with the Community and Labour constituency in the Charter arena, jointly sponsored by the SAIA and the LOA.
• Two complementary awareness projects were implemented during this time, including a commuter financial literacy programme implemented by Primedia company Comutanet at taxi ranks and train stations nationwide, and a Mall Theatre and Shoppa Show programme at shopping malls and strip malls adjacent to the taxi ranks implemented by Provantage. The FSB partnered with the SAIA on these two projects.
• Two important interventions at school level were implemented in partnership with the FSB. A teacher development project involving resource development and workshop intervention for the new subject Mathematics Literacy in accordance with the National Curriculum Statement, was implemented by product provider Bright Media. This project was implemented with the blessing and cooperation of the National Department of Education, as well as the provincial Departments of Education in all 9 provinces of the country. The intervention was aimed at school teachers and learners in grade 10 and 11. Ten thousand (10 000) resource files and other relevant material were distributed to schools in the target market and 37 workshops were held for 1763 teachers. This intervention hopes to directly reach 70 520 learners per year and a total of 400 000 learners per year through the resources distributed. Implementation of another resource project aimed at new subject EMS (Economic Management Services) teachers and learners from grades 0 – 9 was initiated together with the FSB and the Department of Education.

“Financial literacy is extremely important, especially also as it has a direct link to financial access. Our efforts in the LSMs 1 – 5 in the consumer education arena is therefore extremely valuable as many of our member companies are increasingly attempting to access the low income market,” said Napier.

Napier said that the Financial Sector Charter requirements in terms of access and consumer education have largely driven the efforts into the low income market. He added that it would be a pity if the sector might not be governed by the Charter in future as the generic BBBEE Codes do not include access and consumer education.

The SAIA believes that the value of collaboration with regards to consumer education cannot be emphasized enough.

Issued on behalf of:

The South African Insurance Association

For arrangements with regards to interviews or pictures, please contact:

Adéle Joubert: Public Relations Officer

The South African Insurance Association (SAIA)

(011) 726 5381

082 349 1375

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