Santam has set aside a R1billion relief fund for potential business interruption claims from its policy holders.
Santam said that it was not pressured to establish the fund, but wanted to do the right thing in the light of likely claims arising out of the Covid-19 interruptions, particularly for small businesses.
Group chief executive Lizé Lambrechts yesterday told Business Report that the insurer had been in talks with brokers and hoped to commence payments from August 1.
“We really want to help our clients: we are not unsympathetic to what the lockdown has done to them,” Lambrechts said.
“This is for our own account; we’re getting no assistance from our reinsurers.”
The establishment of the fund comes just hours after some of the country’s biggest insurers reached an agreement with the Financial Sector Conduct Authority (FSCA), the Prudential Authority and some major insurers on interim relief for business interruption claimants.
The FSCA described the agreement as “a fair outcome” for both clients and insurers – as well as a world first.
Santam has been at the forefront of the contingent business interruption (CBI) saga since Business Report first revealed insurers were rejecting claims from travel and hospitality sector clients whose businesses were affected by the Covid-19 pandemic.