Unlisted insurance group OUTsurance has thrown down the gauntlet to competitors, by taking a contrarian view around non-payment of business interruption insurance claims related to infectious diseases cover.
“The treatment of these claims since March is congruent with the views published by the Financial Sector Conduct Authority in an industry communication on 18 June.” “We can’t mention the names of clients, but they are largely in the hospitality industry including guest houses, restaurants, hotels and game lodges…. A small percentage is in retail.”OUTsurance’s move comes as JSE-listed competitor Santam faces a legal battle in Cape Town with a boutique hotelier and restaurant group related to non-payment of claims linked to the pandemic. Santam, South Africa’s largest short-term insurer, is yet to comment on the matter.
“These businesses all bought pricey business interruption insurance policies that included extensions for claims arising from infectious or contagious notifiable diseases from Santam and a number of other insurers. Covid-19 qualifies as a declared notifiable disease, yet insurers are either rejecting the claims, or frustrating the process by making it near impossible to claim,” it said.