Objectives

The primary objective is to appoint a qualified short-term insurance broker to manage the municipality’s insurance portfolio for a three-year term. The broker will safeguard municipal assets, minimize financial risk exposure, ensure compliance with municipal finance legislation, and efficiently administer claims while optimizing the self-insurance reserve.

Scope of Work

• Review and renew the annual insurance portfolio by 30 June each year, securing competitive underwriting terms across multiple policy lines including motor fleet, public liability, employers’ liability, events, directors and officers, cyber liability, and SASRIA.
• Manage end-to-end claims processing, including acknowledgment within seven days and settlement targets within twenty-one days.
• Produce monthly claims dashboards, quarterly detailed reports, and annual reconciliation statements.
• Liaise with underwriters, third-party service providers, and loss adjusters on behalf of the municipality.
• Administer the self-insurance reserve, including assessment of eligible claims, appointment of loss adjusters, negotiation of repair costs, and management of a designated refundable advance.

Technical Requirements

• Achieve a minimum of 32 out of 40 functionality points during evaluation.
• Demonstrate corporate experience through years in operation, tenure serving local authorities, and verified client references.
• Submit mandatory compliance documentation: valid B-BBEE verification, SARS tax compliance PIN, municipal rates clearance, Compensation Commissioner good standing, FAIS authorization, and proof of insurers’ solvency margins.
• Provide certified copies of professional indemnity insurance (minimum R100 million per joint venture member) and public liability coverage (minimum R50 million).
• Adhere strictly to prescribed tender formats, include board resolutions, and comply with pricing schedules where annual escalations are capped at the Consumer Price Index rate.
• Attendance at a mandatory virtual briefing session is compulsory for eligibility.

Skills Requirements

The successful bidder must demonstrate extensive expertise in municipal insurance brokerage, risk assessment, and claims adjudication. The assigned project team must include a senior project leader with proven experience in policy amendments, complex claim resolution, and municipal stakeholder management, supported by a qualified claims specialist or clerk. Candidates must possess strong negotiation capabilities, financial reporting proficiency, and thorough knowledge of South African insurance regulations, municipal finance frameworks, and loss adjustment protocols.

Explanation of Unusual or Complex Terms

Self-Insurance Reserve

A municipally funded cash reserve used to absorb first-layer losses before external reinsurance applies. The broker administers claims falling within this threshold, ensuring proper documentation, timely processing, and alignment with asset valuation targets.

Refundable Advance

A R500,000 float provided by the municipality to expedite small claims within the self-insurance limit. The broker must invest idle funds in approved instruments, track expenditures, calculate daily interest, submit monthly reconciliations, and repay the principal plus accrued interest within thirty days of contract termination.

Loss Adjuster

An independent, locally registered expert appointed by the broker to inspect damages exceeding R50,000. They determine repair versus write-off viability, validate replacement values, and negotiate settlement amounts with contractors and insurers to ensure cost-effective outcomes.