Yes, the policy will only pay up to 70% of the share price the day before the event became news. An example:
1. Share Price :R200.00 the day before the news event
2. Claim limit: Losses between a share price of R180 (trigger price) and R60 (limit) will be paid.
Why is there a limit?
When designing the product, no losses in a Top100 JSE listed company above 70% were noted within a 30 day period from the news breaking, based on the historic research performed. Therefore this scenario is highly improbable and we do not want to increase the premium for an event that is extremely unlikely to occur.
We may introduce an option to allow cover of up to 100% in future, for an additional premium, for those who would like cover up to 100% loss.