Court finds group liable
JOHANNESBURG - South Africa's Santam said yesterday it was considering a court ruling that found it should pay a coronavirus-related claim it had rejected, which sent it shares down over 4%.
Like peers around the world, Santam, South Africa's largest non-life insurer, has been fighting with some clients after it resisted paying claims related to the impact of coronavirus lockdowns on their businesses.
The insurer and South African rivals had argued lockdowns were not covered under their business interruption policies. But a court on Tuesday found that it was liable to pay claims made by one client, a hotel group, in a closely watched case seen as key to establishing insurers' obligations.
Santam said the complex judgement required careful consideration, and it would discuss it with all stakeholders, including its reinsurers, before responding.
Global reinsurers have also declined to pay out in such cases. Santam said their response was "important in helping to reach finality on this matter", and it would seek to do so as quickly as possible.
‘6 to 7 BILLION’
Santam has already paid R1 billion to affected clients in the form of interim relief, intended to tide them over while court cases play out. These payments will be deducted from any further pay out made to the clients.
It has raised a provision to cover its "best estimate" of exposure to the relevant policies.
Insurance Claims Africa (ICA), which represents more than 750 clients who have had claims rejected, is reassessing the value of their claims based on Tuesday's ruling, because this found Santam was liable for the full indemnity period of 18 months, rather than less. - Nampa/Reuters