It took just 48 hours.

As well all know by now, Momentum hastily announced sweeping changes to it’s life insurance policy that will now pay out to the value of the policy if their client dies as a result of violent crime, regardless of medical history or previous non disclosures of medical conditions.

48 hours.

Their first response was that should they pay, it would set a precedent for them to be liable to pay other claims that they have managed to avoid to date.

So what happened in that space of time.

There were 2 critical elements that played a role.

The First Element- Massive Negative Public Pressure.

The public reaction to the initial refusal to pay was so great and so negative that Momentum was squirming like the proverbial ‘worm on the hook.’

Here was a man who died defending his family from violent criminals who not only had to deal with the the trauma and grief of the loss of a deeply loved family member, but also the cold hearted response from his life insurer.

Every single person that read this story felt and thought the same thing about Momentum.

“You f*cking bastards! I’m pulling my money out! I’ll NEVER be YOUR client!!”

Momentum felt this. Deeply.

They had invested billions into brand building and creating integrity in an industry well known for it’s lack thereof that the wave of disgust and disdain expressed by the public (and many Momentum clients) was overwhelming to say the least and this started to (quickly) erode the facade of integrity Momentum had been building for so long.

For many people who either are or were considering becoming Momentum clients, this left a very, very bad taste as they asked themselves ,” If this happens to me, WILL THEY PAY?”

That seed of doubt is enough to cost Momentum BILLIONS of Rand in revenue!

The Second Element – The fear of loss.

I have absolutely no doubt that the number crunchers at Momentum spent 48 hours looking at the risk and loss projections if they DIDN’T pay out.

According to the latest financial statements from MMI group (to date 30th June 2018) , their net insurance premium income was R29, 893 BILLION!

This claim of R2,4 million would represent just 0,00008% of that, but the FAILURE TO PAY would cost them a GREAT DEAL MORE – and EVERYONE KNEW IT!

They knew that in the face of growing dissent , it wouldn’t be worth the battle because even if they won and even if they were legally entitled to repudiate this claim due to the non-disclosure of a medical condition, they would lose the war.

Faced with massive REVENUE loss in the BILLIONS- they LOST any taste for battle and capitulated.

The VERY thought of the massive losses and the consequences thereof was enough to ‘persuade’ Momentum to seriously reconsider their position and do a VERY SMART about turn!

This is the essential principle of the concept of War By Attrition.

Present the potential for massive losses, so the enemy has no taste for war and the war is won before it even starts.

This is EXACTLY how the SA FUEL WAR WILL WIN.

By presenting the potential for MASSIVE REVENUE LOSS, the enemy will lose taste for battle and capitulate.

This ‘Momentum’ shift is a clear sign that the mere threat of revenue loss is sufficient to induce surrender.

They are more afraid of losing all that money than we are of taking it away from them!

HAVE YOU JOINED THE SA FUEL WAR?