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Spring Tide Devastation

20 September 2023 Institute of Risk Management South Africa (IRMSA)

Following the spring tide damage this past weekend, the Institute of Risk Management South Africa (IRMSA) has emphasised the need for businesses and individuals to conduct a renewed insurance and infrastructure risk assessment and to ensure insurance is current and comprehensive.

The Garden Route, bore the brunt of the devastation as parts of the Western and Eastern Cape were pummelled by enormous swells and towering waves due to the spring tides, after warnings issued by the SA Weather Service regarding damaging winds.

The consequences were severe, leading to challenging navigation circumstances, extensive damage to coastal infrastructure, beach erosion, and rogue waves.

In one tragic incident in Wilderness, a wave's force swept into a car park, tragically claiming the life of a woman, and injuring a man while washing away several vehicles. This says IRMSA serves as a grim reminder of the unpredictable and destructive nature of natural disasters.

The Western Cape Department of Infrastructure has confirmed that teams have been dispatched to assess the magnitude of the damage, with mop-up operations actively in progress.

IRMSA’s Chief Risk Advisor Christopher Palm says while it is imperative to address the immediate fallout from this event, there's again the urgency to highlight the importance of risk management. Risk management is all about the prevention of threats from materialising and the leveraging of opportunities. "It's moments like these that highlight the sheer importance of performing risk assessments regularly given changes in circumstances and then ensuring that the risk response strategies are in place are adequate and effective. As these recent events highlighted, having an up-to-date insurance policy and a risk assessment that accurately analysis risk causes, consequences and required controls are imperative to ensure one’s potential exposures are addressed. Then of course it is not merely about bouncing back from the current crisis but ensuring that lessons are learnt, and the necessary adjustments are made to strategy and decision-making to build future resilience as far as being better prepared for these unexpected events."

Palm says businesses and individuals must now pivot their focus to safeguarding their safety, assets, and investments by reevaluating their risks and then reviewing the adequacy of their insurance, amongst other risk response strategies. This approach is not only strategic but essential for long-term sustainability in a fast-changing environment with lots of uncertainty and complexity.

In addition, he says the damage on the Garden Route is a stark illustration of the unpredictable fury of nature and such incidents underscore the importance of conducting post-event infrastructure risk assessments, ensuring that both individuals and businesses are not just prepared for the immediate aftermath, but also for the potential future threats.

IRMSA extends its deepest condolences to the affected families and urges communities to support one another during this time.

Using risk management to manage uncertainty, both from a threat and opportunity perspective and learning from our experiences to become more resilient will always be our best defence against the unpredictable says Palm.

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The two-pot retirement solution has shone a spotlight on certain shortcomings in SA’s pension fund landscape. Which of the following steps would you take to improve compliance and retirement outcomes?

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Enhance fund oversight to reduce arrears.
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