The AGM handout and how to use it

In this short blog article, we explain the sectional title AGM handout and how it has proven to be an invaluable tool at sectional title AGMs.

This simple A5 brochure is effectively composed of four pages:

• Front cover – The insurance section of the prescribed agenda, cut and pasted.
• Inside pages – A layout of a typical Schedule of Replacement Values (SRV) with numbered, concise explanations.
• Back page – The chairperson’s insurance script.

1. Front page

The prescribed management rules outline the order of business for AGMs, which includes several insurance items for discussion:

• Approval of the SRV (Schedule of Insurance Replacement Values)
• Determination of the Extent of Insurance Cover:
  • Liability (PMR 23.(6))
  • Fidelity (PMR 23.(7))
  • Additional Cover (PMR 23.(8))

2. The inside pages

The brochure opens to reveal a detailed example of an SRV layout. Attendees can easily cross-check their own SRV against the numbered sections, which are explained in detail under the heading Understanding the Schedule of Replacement Values (SRV).

Providing this explainer ensures the body corporate offers owners a clear and well-presented SRV, reducing risk while demonstrating a commitment to excellence.

3. The back page – The chairperson’s script

The back page serves as a ready-to-read script for the chairperson or presenter, guiding them through the relevant agenda items. Blank spaces are included for completing specific scheme details, such as:

• The date of the last valuation
• The liability sum insured
• The fidelity sum insured

Example script for the AGM:

Buildings – Approval of the SRV
“Refer to the SRV enclosed or as sent with the AGM notice. The last valuation was conducted in ………………….. (month/year). The SRV figures are based on this valuation, adjusted for inflation. Refer to point 6 overleaf (read point 6 aloud if necessary). Owners should ensure their units are insured for adequate sums and may instruct the body corporate to adjust these sums if desired. Owners are strongly advised to review this information carefully.”

Liability
“This covers owners collectively against liability the body corporate may incur for bodily injury, death, or illness of a person, as well as property damage or loss occurring on or in connection with the common property.
The minimum cover is R10 million. We have arranged R………………….. The meeting will decide if this is sufficient.”

Fidelity
“This insurance protects against fraud, dishonesty, or misappropriation of funds.
The minimum cover equals total investments/reserves plus 25% of the operational budget. We have arranged R………………….. to meet this requirement. The meeting will determine if this amount is adequate.”

Additional cover
“This includes any non-prescribed items, which require owners’ approval via special resolution. For example, a golf estate might insure golf carts.
Currently, the trustees have arranged cover based on advice from an independent, authorised financial/insurance advisor. Written confirmation of this advice is on record and renewed annually with the policy.”

Incorporating the handout

This handout can be included in the AGM pack, allowing owners to follow the chairperson’s presentation with ease. A PDF version is available for download, and the accompanying video explains these details in a more visual format.