SA needs R360bn insurance policy to cover its risks

08 September 2015 - 02:13 By Poppy Louw

South Africa has more than R360-billion at risk from man-made and natural threats over the next decade. This is according to the latest city risk index compiled by insurance giant Lloyd's of London.Using projected GDP data from 2015 to 2025, the index presents an analysis of the risk to economic output in 301 major cities from 18 man-made and natural threats.According to the index, Johannesburg faces R93.5-billion in GDP losses - but the East Rand stands to lose more as a proportion of GDP, 7.84%, compared with Johannesburg's 6.6%.A market crash would have the worst effect on South African cities, followed by catastrophes such as pandemics, cyber attacks and sovereign debt default.Economist Chris Hart said the index was a valuable tool for policy-makers in that it allowed them to make long-term plans for dealing with the risks "if ever they materialise"."Until then they are just risks and should be used to reflect on systems in place and if they need to be improved," Hart said.A global market crash was deemed to be the biggest transnational risk.It would wipe R14.3-trillion off the world economy.The index, which has been based on original research by the Centre for Risk Studies at the Cambridge Judge Business School at Cambridge University, will be updated every two years. ..

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