Santam registers insurance claims related to wave of looting and violence

SA’s largest short-term insurer, Santam, scheduled an online media briefing last week about its Covid-19-related business interruption claims, little realising that come Monday, the company would be grappling with a rash of claims stemming from an even more dramatic form of business interruption.

By close of business on Wednesday, the insurer had registered 21 motor and 167 non-motor claims stemming from mass unrest and looting in Gauteng and particularly KwaZulu-Natal.

Santam is not revealing the quantum just yet, but all the claims fall under Sasria (the South African Special Risks Insurance Association), a state-owned entity which covers loss or damage to insured property as a direct result of civil unrest, including rioting, strike action and public disorder, with insurers such as Santam acting as intermediaries.

Getting back to the issue of the highly contested pandemic-related business interruption claims, Santam was at pains to stress that it had not had a bumper year in 2020.

Last week Insurance Claims Africa (ICA), a specialist public loss adjuster — representing about 850 claimants in the tourism and hospitality sector in their battle to get large insurers to pay out on business interruption claims relating to the devastating Covid-19 lockdowns — released an economists’ report stating that the short-term insurance industry made record profits last year.

Sharing snippets of its 2020 financial results, Santam said its commercial and personal business had, in fact, declared marginally lower premiums last year compared to 2019 and income to shareholders decreased by 75%, while business interruption claims amounted to R3bn, R1bn of which was paid out by August 2020.

CEO Lizé Lamprechts said 43% of its hospitality and tourism clients who had indicated that they intended to file business interruption claims had not done so.

When surveyed about that in April, some clients said they were happy with the interim payments Santam made last year, Lamprechts said, “but we are concerned that there could be clients that are experiencing hardship but have not submitted the information we need to process their claim”.

“Clients must prove and quantify their losses,” she said.

The deadline for such submission is August 31.

Santam’s appeal of the judgment of the Western Cape High Court in the Ma-Afrika case, specifically with respect to the indemnity period — the number of months’ lost income which must be paid — will be heard on August 27.

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