Loss adjustment firm, Insurance Claims Africa (ICA, has written to the Minister of Finance. Tito Mboweni, formally requesting his urgent intervention in the dispute between over 500 tourism and hospitality sector claimants who have been denied pay outs on their Business Interruption (BI) claims.
This is despite the fact that they had taken out specific BI policy extensions to cover business interruption for a notifiable disease. The insurers are claiming that these businesses were shut due to national lockdown but ICA says the lockdown is as a result of the COVID-19 pandemic and that it is “disingenuous” of insurers not to recognise the link.
ICA CEO, Ryan Woolley said the firm has asked for Mboweni to facilitate potential settlement discussions.
“Businesses in the tourism and hospitality sector have been the hardest hit by the pandemic. With domestic and international travel halted and the continued uncertainty around when the sector will be allowed to operate, many businesses have been forced to close, and to lay off employees,” he highlighted.
Furthermore, over 600 000 employees within the tourism value chain had applied for the Unemployment Insurance Fund’s Temporary Employee Relief Scheme (TERS) and this programme came to an end in June. “The end of this programme means that employees will not receive any income from this month onwards,” Woolley added.
He pointed out that continued refusal by insurers to honour Business Interruption claims would further exacerbate this crisis, which will lead to mass business closures and job losses across the sector.
Woolley said ICA has also joined forces with hospitality group Ma-Afrika Hotels in their litigation against insurance major, Santam, which is due to be heard in the Western Cape High Court, on September 1.
Ma-Afrika announced that instructing attorneys, Thomson Wilks and advocate Guy Elliott will be joined by attorney David Bayliss and advocates Sean Rosenberg, Mike van der Nest and Jeremy Gauntlett in this battle against the country’s insurance giant.