Insurers Fail Tourism in South Africa

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As the Tourism Sector, we are seeking immediate relief through a sensible compromise settlement of our Business Interruption claims with Insurers. We cannot afford a lengthy court process that will cause mass closures of tourism businesses and lead to thousands of job losses. 

Tourism and Hospitality businesses across South Africa have suffered deep losses as a result of COVID-19. 

Our businesses were amongst the first and hardest hit even before the virus arrived in South Africa and will certainly be amongst the last to reopen to some semblance of normality. 

After years of paying Business Interruption Insurance with extensions covering infectious and notifiable diseases, Insurers are now rejecting our claims. 

Business Interruption insurance exists to help companies survive an unanticipated event. There are generally two types of BI insurance: a basic policy which requires physical damage to the business premises in order to trigger a claim, and a Tourism / Hospitality policy that contains a specific extension that includes interruption by infectious or contagious notifiable disease. 

COVID-19 qualifies as a declared notifiable disease, but local insurance companies are frustrating our legitimate claims, claiming that it is government regulations in respect of the lockdown that are the cause of the loss, not COVID-19. This is disingenuous, as it is clear that, without COVID-19, there would be no lockdown. 

This is our call to Insurers to settle our BI insurance claims on a compromise basis with haste so we can stem the already devastating losses our industry has had to endure. 

If not, we call on South Africans to join us by re-evaluating their insurance providers.  The true test of a company’s ethics and values is how they treat their most vulnerable customers at their time of need. I say: if you agree that your insurer is letting people down, act now.

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