Open letter to South Africa’s students‚ universities and government‚ represented by Minister in the .
Momentum is offering R60000 accident cover over the notoriously dangerous Easter break for R10. The payment for a policy is made with cellphone airtime by sending an SMS to 38858. The deal spans from midnight April 4 till midnight April 10.
Derek Pead, who heads Momentum's new Cover2go division, plans to roll out similar fixed-term accident cover for other holidays. Pead believes that traditional insurance is too expensive for most people.
Only 15percent of South Africans have any type of short-term insurance, including fixed-term accidental cover, and this falls to 1percent in lower income groups, a recent all media and products (AMPS) survey found.
"These statistics back up the human tragedy that unfolds around every holiday period when thousands of breadwinners and families are lost on South Africa's roads," said Metropolitan Retail marketing manager Sandy Wilde.
"From a business perspective, Cover2go is a specific response to two major challenges facing the industry. Firstly, one of the biggest deterrents to consumers is the complexity and paperwork involved with insurance products, which consumers simply don't understand and are inclined to resist. Secondly, consumers don't want to be tied down - they want flexibility," she said.
Pead believes that transacting life insurance in this way is likely to revolutionise the industry and its reputation.
"There is a firmly entrenched belief that insurance can only be sold and that it's a grudge purchase. We intend to challenge that norm," said Pead.