Ongolo Proud African

The financial impact of the pandemic on South African consumers and corporates

12 September 2021

South Africa's largest short-term insurer, Santam, released its annual Insurance Barometer report on 8 September 2021. The report showed the impact of the COVID-19 pandemic and the challenging macro-economic environment on consumers and corporates.

Key consumer insights:

  • 60% of respondents had experienced financial loss during the pandemic either from a loss of earnings or increase in costs
  • 81% of those who experienced financial loss were able to use savings to make ends meet
  • Consumer spend was drastically reduced:
    • 59% reduced restaurant outings / food takeaways
    • 45% reduced spend on travel / petrol, clothing, footwear and accessories
    • 33% cut hobbies, sports and gym expenditure
    • 28% reduced their groceries bills
    • 23% cut TV subscriptions
    • 19% reduced domestic travel
    • 15% cut back on cellphone contracts
    • 10% reduced their repayment of debt including school fees

Key corporate insights:

  • Hospitality, transport, aviation, marine and construction were the hardest hit sectors in South Africa
  • 62% of corporate & commercial entities have lost profits. On average, profits declined by 38% in SMEs, by 36% in large commercial and by 24% in large corporates
  • 28% of corporates had to retrench staff and 30% put staff on partial pay. Another 11% of corporates compelled staff to take unpaid sabbaticals,
  • 41% of hospitality sector enterprises were faced with business closure, 84% lost profits and 59% made staff retrenchments,
  • 80% of transport sector businesses had profit losses compared to 77% of construction companies
  • Only 3% reported an increase in profit this year (mainly SMEs)
  • 3% filed business interruption claims, 2% business all risk claims, 2% for accidental damage, 2% theft, 2% buildings, 1% vehicles, 1% public liability, 1% machinery breakdown.



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