We are intrinsically linked to the rest of the world through our currency, and a hot topic on everyone’s lips recently is the Rand/Dollar exchange rate. The effects of the weaker Rand are felt whether we like it or not, and are not limited to businessmen who import luxury items.
While the weak Rand may affect international travel, the price of petrol and the cost of imported vehicles – it also has an impact closer to home.
The value of items that you have insured – even recently – may need to be revisited. And especially so if they are imports, or not available in South Africa any longer.
What would these include?
• Designer clothing, including bags, shoes and luggage
• Tiles, rugs or other home accessories
• Motor vehicles
It makes sense to value and insure items upon purchase. And of course, to have your valuations updated regularly.
However, the Rand has fallen hard – especially over the past year. Therefore, the value of imported goods has to be adjusted so as to avoid a shortfall in case of loss or damage. The reality is that the Rand has lost almost 20% of its value over the past year – which means that your imported goods will cost 20% more to replace.
With the Rand fluctuating as it has, it would be wise to take another look at these imported items. Especially after an extended period of Rand weakness. We recommend a quarterly valuation, notably of high value items which would feel the effects of a weak currency immediately.
If you would like us to assist you with an updated valuation of your imported assets, please give one of our brokers a call.