SA Corona Virus Online Portal Logo
CLICK HERE FOR MORE INFORMATION

Secondary

insurance-claim

Business Insurance Update – Santam commences calculation of valid claims

“In light of the SCA (Supreme Court of Appeal) judgment, the FSCA now expects the non-life insurance industry to honour its CBI cover obligations and to make payment of valid CBI claims without delay. Discussions between the non-life insurance industry and reinsurers should be expedited to ensure that policyholders who have already suffered huge financial losses since March 2020, do not continue to suffer these losses, as the legal certainty which the non-life insurance industry required has now been provided by the SCA,” the Financial Sector Conduct Authority said at the end of December 2020.

Santam announced on 4 January that it will commence the process for assessing claims for policies with qualifying contingent business interruption (CBI) extensions.

According to Santam, the claims assessment process will specifically apply to policies impacted by the recent judgment in the Western Cape High Court in the case between Santam and Ma-Afrika Hotels and The Stellenbosch Kitchen, and the judgment of the Supreme Court of Appeal (SCA) in the case between Café Chameleon and Guardrisk Limited. “In line with the court rulings, this applies to Santam policies written by its Hospitality and Leisure Division (H&L),” Santam stated. ”The process will include assessments for the applicable H&L business interruption claims that were previously rejected in the months after the national lockdown commenced on 27 March 2020. “

However, the company believes that there are valid reasons to appeal the judgment of the Western Cape High Court in the Ma-Afrika case with respect to the indemnity period. The company will therefore continue with its application for leave to appeal the Ma-Afrika judgment at the SCA, specifically with regard to this.

Santam should be commended for its decision to set the assessment process in motion, rather than wait for the outcome of the appeal case in February. Other insurers will hopefully do the same.

Affected clients should be advised to follow the guidelines contained in their contracts closely, and to employ professional accounting officers to assess the actual loss as the assessment will be done on a one-on-one basis.

Click here to download the FSCA media release.

Click here to read the Santam media release.

, ,

Comments are closed.