Challenging underwriters to look for creative ways of underwriting
By: Koketso Shabalala, Underwriting Head: Construction and Single Projects at SHA Risk Specialists
The Construction industry in South Africa continues to face challenges in growth in stark contrast to the infrastructure challenges that face the country which would be viewed as a catalyst for growth. One would then expect an upsurge in activity in the construction sector however a myriad of obstacles stand in the way of the realisation of these opportunities.
Some of these opportunities include public infrastructure projects planned for 2025 valued at R322.2 billion mainly in the transport/logistics space and in the renewable energy space. As insurer’s we have seen an increase in PPP (Public & Private Partnerships) from a renewable energy perspective. These projects carry large project values of significant complexity and thus creating opportunities for a number of different service providers at various levels and sizes, from large to small to medium enterprises. This upsurge partnered with the roll out of infrastructure projects will bode well for the sector.
The slowed growth in the sector has resulted in liquidations, lay-offs and job-losses and as such the sector is also faced with a skills shortage should the project pipeline come into fruition, however we remain positive.
Comprehensive hospitality insurance designed with your business in mind.
Our expertise positions us to effectively cover hotels, lodges, golf and sporting clubs, restaurants, conference and wedding venues, timeshare resorts, etc. This enables your clients to continue welcoming their guests to relax and enjoy their facilities, safe in the knowledge that we have them covered with insurance solutions designed to address the specific needs of their business.
To find out more visit Santam.co.za
or speak to your Relationship Manager.
Santam is an authorised fi nancial services provider (FSP 3416),
a licensed non-life insurer and controlling company for its group companies.
As an insurer we want to have solutions that ensure that we retain as much of the insurance in the local market as possible, this speaks to matters such as our AM Best A-(Excellent) ratings which gives lenders the piece of mind that insured has a solid insurance partner behind them should any unfortunate events occur. Products and solutions that are tailored for large contractors as well as small to medium contractors, a simple example is our Single Project Public Liability offering, where on large projects the Principal contractor/Employer will provide the Contract works cover but sub-contractors can take out this cover on a stan-alone basis for short periods which would cover the duration of their participation on the project. In respect of Employers/Principal we can provide non-cancellable covers that last the duration of the project, including the testing and maintenance period, this ensures that these covers remain in place for the duration of the project at the same terms and conditions agreed at inception, which provide much needed piece of mind considering the challenges faced by the sector.
As Insurers we understand that our clients are navigating a challenging landscape with many challenges that have no control over, such as increasing prices of materials, high inflation, increased competition, water and infrastructure challenges and a shortage in skill in the sector and as such our role as Insurers is to be that of an enabling one to their business.
Editor’s Thoughts
In this insightful piece, Koketso Shabalala, Underwriting Head for Construction and Single Projects at SHA Risk Specialists, explores the paradox of South Africa’s construction sector — rich with potential yet constrained by economic and operational hurdles. As large-scale public infrastructure and renewable energy projects loom on the horizon, the article challenges insurers to rethink traditional models and craft innovative, flexible solutions that support both industry resilience and local economic growth. Shabalala underscores the need for underwriters to play an enabling role, especially as clients face rising input costs, skill shortages, and heightened competition.
How do you think the insurance industry can better support small to medium contractors in capitalising on upcoming infrastructure projects?