According to Moneyweb, the South African Special Risks Insurance Association (Sasria) expects claims related to the unrest in July to amount to R20 billion, with 10% of the amount to be paid out by the end of this week.
Following the riots, the insurance company says over 95% of all registered insurance claims are being attended to.
The group adds that once the process of quantifying claims and the finalisation of the work done by loss adjustors is complete, it is estimated that claims would reach between R19 billion and R20 billion.
According to Sasria MD Cedric Masondo: “By the end of the week, we would have paid R2 billion between us and agent companies.”
Masondo praised the response Sasria has received from reinsurers, noting their prompt response and upfront payment of reinsurance funds in certain instances, thus helping the government insurer to avoid any liquidity issues.
In a related article, News24 reports: “National Treasury told Parliament’s Select Committee on Finance on Tuesday afternoon that the economic damage from the recent unrest could shave between 0.7 and 0.9 of a percentage point from GDP growth in 2021.”
“This does not account for potential value chain disruptions and resultant second-round price or output effects”, it said.
“National Treasury’s submission estimated that only 6% of impacted businesses were open as usual, while 51% of impacted business in the two riot-affected provinces had closed – 7% had closed permanently and 44% had closed temporarily.”
“National Treasury said the rand had been appreciating since June 2021, largely due to rising commodity prices. But between 9 and 19 July 2021, the local currency depreciated by 2.4%, from R14.22 to R14.57 against the US dollar.”
National Treasury director-general Dondo Mogajane said state-owned insurer Sasria was coping with the claims process since the unrest and that stable management would continue to hold the entity in good stead.
“Their claims, as we speak, are between the R20 billion and R50 billion mark. They are not funded by us but their own operations. They have acknowledged that their cover is very cheap. They are not solely dependent on us as government and are running a good operation.”