Hollard to pay relief to clients hit by lockdown

Insurer to pay clients covered for contagious diseases under the terms of their business-interruption policies.
Image: Bloomberg

Hollard Insurance said it will provide relief to small and medium businesses hit financially by a lockdown to curb the spread of the coronavirus.

The announcement comes after the Financial Sector Conduct Authority on Friday said insurers agreed to consider paying relief to customers, pending the outcome of several court cases to determine whether insurers should pay clients who were forced to close due to the lockdown. The relief will come in the form of once-off payments to enable businesses to keep running, the authority said.

With legal processes likely to take some time, Hollard has decided to pay clients covered for contagious diseases under the terms of their business-interruption policies, according to a statement Saturday.

Read:Business interrupted, but insurers don’t want to pay
Hoteliers plead for Covid-19 business interruption insurance payouts

“We remain of the view that nationwide government closures or lockdowns are not insurable risks and we believe that legal certainty regarding lockdown-related claims is urgently required,” said Willie Lategan, chief executive officer of Hollard’s property and casualty insurance unit. “We’re concerned that many smaller businesses will be unable to survive until legal certainty is established.”

South Africa’s government allowed only essential services to operate under a lockdown imposed late March. While rules have since been relaxed, insurers have rejected business-interruption claims, saying payouts can only result from physical events such as an infection at a company’s premises.

© 2020 Bloomberg

COMMENTS   1

You must be signed in and an Insider Gold subscriber to comment.

SUBSCRIBE NOW SIGN IN

”No naked man lost anything”

Anonymous

You are under an obligation to pay, not because you decided to ”provide relief”1

End of comments.

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR
BTC / USD

Podcasts

Instrument Details  

You do not have any portfolios, please create one here.
You do not have an alert portfolio, please create one here.
INSIDER SUBSCRIPTION APP VIDEOS RADIO / LISTEN LIVE SHOP OFFERS WEBINARS NEWSLETTERS TRENDING

Follow us:

Search Articles:
Click a Company: