The non-life insurance sector is playing its role during the pandemic

09 July 2021 The South African Insurance Association (SAIA)

The South African Insurance Association (SAIA) and its members in the non-life insurance industry are committed to supporting its employees, clients, service providers, and the general public to assist and alleviate the hardships caused by the Covid-19 pandemic.

These have included among others providing premium holidays, premium discounts for policyholders, fast-tracked claim processes and limiting the impact on staff, where possible, by protecting job losses.

It is therefore manifestly incorrect to state that the non-life insurance industry has been ignoring its clients' plight and failing or delaying payments. The non-life insurance sector is a complex and broad industry spanning many sectors.

SAIA acknowledges that certain non-life insurance classes of insurance lines might have performed better than others during the pandemic. For instance, vehicle insurance claims during this period have declined because of various lockdown regulations such as the curfew while other insurance lines have been hard hit like the credit and trade credit, travel, engineering, and marine insurance sectors for example.

In terms of claims, SAIA confirms that large numbers of claims have been and are being paid by insurers. In a minority of cases, claims are complex and in certain cases, such as some of those involving contingent business interruption (CBI) claims, still require legal certainty in respect of indemnity periods. In the interim those insurers with exposure to CBI claims have either settled in full or made interim pay-outs to those policyholders affected. Insurers also have to take into account the terms and conditions of their reinsurance agreements to ensure they are supported by reinsurers, who require this legal certainty.

It is against this context, the recent research commissioned by Insurance Claims Africa during an uncertain time for the industry, needs to be assessed and benchmarked against events prior to the pandemic and factor in broader macro-economic conditions. Once SAIA has properly interrogated the research report, it will consider a more detailed response.

Insurance plays a critical role in the economy and the ability of the financial sector more broadly to be able to fund and assess future risks.

SAIA encourages its members to in all cases expediate and settle claims where possible while recognising that they also have a duty to properly assess and determine pay-outs that protect all their policyholder’s interests.

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