Sasria says claims for looting will be honoured
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WORDS ON WEALTH
As the unrest and wanton looting in KwaZulu-Natal and Gauteng appears slowly to being quelled, insurance claims for the immense losses incurred are, no doubt, mounting up quickly.
Sadly, many small businesses were uninsured, according to news reports. The policies of businesses that were insured probably included specific cover for damage caused by riots, provided by the South African Special Risk Insurance Association (Sasria).
Sasria is a state-owned company, incorporated in 1978. Karabo Kopeka, MiWay Insurance head of claims, says: “Sasria offers anyone with assets in South Africa this unique form of insurance, making provision for everything from civil unrest to strikes and riots.
“An affordable option for both individual and corporate entities, Sasria insurance is not provided directly to the public, but instead handled via direct insurers, who essentially manage the service on Sasria’s behalf, thus enabling the state-owned entity to provide cover at a lower cost.”
If you have household contents, homeowner’s, or vehicle insurance, a small portion of your premium probably goes to Sasria – it may be worthwhile checking your policies, just to make sure. In fact, the amount that goes to Sasria is mystifyingly low: for example, the flat rate for a private motor vehicle is R2.02 a month.
On its website, Sasria says that at inception its mission statement was “to underwrite any perils that the conventional insurance market was unwilling or unable to underwrite. Consequently, the perils of Sasria were expanded and encapsulated in the Reinsurance of Material Damage and Losses Act of 1989 read in conjunction with the Conversion of Sasria Act of 1998”.
From the mid-1980s to date, the perils insured by Sasria have been as follows:
1. Any act (whether on behalf of any organisation, body or person, or group of persons) calculated or directed to overthrow or influence any State or Government, or any provincial, local or tribal authority with force, or by means of fear, terrorism or violence.
2. Any act which is calculated or directed to bring about loss or damage in order to further any political aim, objective or cause, or to bring about any social or economic change, or in protest against any State or Government, or any provincial, local or tribal authority, or for the purpose of inspiring fear in the public, or any section thereof.
3. Any riot, strike or public disorder, or any act or activity which is calculated or directed to bring about a riot, strike or public disorder (the term “public disorder” shall be deemed to include civil commotion, labour disturbances or lockouts).
4. Any attempt to perform any act referred to above.
5. The act of any lawfully established authority in controlling, preventing, suppressing or in any other way dealing with any occurrence referred to above.
“From damage to private property, to vehicle vandalisation, this unique form of cover is custom-made to protect all your assets should they be compromised in any way as a result of any act linked to the furthering of political ideals or public fear-mongering,” Kopeka says.
However, there is a caveat: “General looting or theft that cannot be linked to events of this nature are not covered under the terms of Sasria insurance,” he says.
This week in Business Report, Sihle Makhowana reported Sasria would be treating looting claims linked to the wave of unrest as valid. It expected claims to amount to billions of rands, in what would be the biggest payout in its history.
The report quoted Sasria managing director Cedric Masondo, who said the company had been receiving claims since Saturday and had appointed teams to assess the damage.
“Business owners who have Sasria cover and had their premises, equipment, vehicles and/or merchandise destroyed or looted as a direct result of the violent riots, can claim from Sasria,” said Masondo.
Depending on their cover, businesses can receive payouts of up to R1.5 billion, with no excess payments required.
Masondo said Sasria projected payouts to amount to between R3bn and R7bn.
On the validity of claims, Masondo said: “We won’t go to court or spend money on lawyers to decide if your claim is valid or not. We are not going to define what a ‘riot’ means and reject claims if it falls outside of the riot definition. From our point of view, these are all Sasria-related claims, and payments can be made within a week.”
Ryan Woolley, the chief executive of Insurance Claims Africa, who has been instrumental in fighting for business interruption claims to be honoured by the big insurance companies, sounded some words of caution. Quoted on radio and television, he said claims were likely to be well over R10bn, and that, although Sasria was well managed, the claims process may not be without hiccups. He expected “the lawyers” would ultimately be involved, despite Masondo’s assurances, and they would be “like the ones we've been fighting in the Covid claims ... those are the lawyers we're going to be dealing with once again”.
Whichever way it goes, Woolley noted, the sheer volume of claims (including Covid-related claims) will slow down the payout process.
How to claim
Your first port of call is your nearest police station, where you will need to get a case number before registering your claim with your insurance company. This can be lodged using online self-service, a dedicated mobile app, email or telephonically, depending on your insurer. Your claim will then be processed and your insurer will deal with Sasria on your behalf.