Santam swiftly pays over R500 million to contingent business interruption policyholders
Santam, South Africa’s largest short-term insurer, has to date paid out R506 million of the R1 billion allocated for urgent relief to policyholders in the hospitality, leisure and non-essential retail services industries who have Contingent Business Interruption (CBI) extension in their policy cover.
The company commenced relief payments on 5 August, and had by this morning (Thursday, 13 August) already paid out R506 million in relief to 1315 policyholders. The relief payments are a meaningful contribution to some of the most vulnerable small and medium-sized policyholders who have been worst impacted by the lockdown.
Lizé Lambrechts, the Santam Group CEO, said the company ensured that all the necessary resources were mobilised to effect the quick payment of the relief to policyholders. The average time from receipt of the required documentation to payment is less than five days. Relief payments are set at a minimum of R25 000 and a maximum of R1.5 million for individual CBI policyholders. Santam has made it clear that it would not make the process of claiming the relief too onerous for their qualifying clients and would rather focus on swift payment of the relief to the most impacted industries.
“These payments are to existing policyholders who have claimed for losses during the COVID-19 pandemic period and have CBI extensions in their policies. We are supporting policyholders who are in financial distress and helping to make a difference in the lives of South Africans who have been negatively impacted by COVID-19,” said Lambrechts.
The relief payments equate to 70% of two months’ value of the sum insured for Santam’s policyholders in the hospitality, leisure and non-essential retail services industries. The two months are reflective of the period from late March until about May, when most businesses were restricted from trading due to the Level 4 and 5 lockdown alert in the country. The 70% is based on a view that the businesses would have experienced variable expense savings during the lockdown.
The relief payments are the outcome of Santam’s proposal to the regulators to help existing policyholders who have claimed for losses during the COVID-19 period, while awaiting the outcome of the legal process to determine the interpretation of CBI cover on their policies.
Lambrechts said it was evident that the relief payments were making a tangible impact on the lives and livelihoods of policyholders.
“Judging from the feedback we have received, we believe that our relief payment approach is one of the most transparent and fair in the industry. A number of very pleased policyholders have written to their intermediaries or directly to us to express their appreciation. We believe that we are making a big difference in people’s lives and standing true to our brand promise of Insurance Good and Proper amid the uncertainty that still exists. That is what matters most to us,” she said.
“For 102 years Santam has been a key part of South Africa’s insurance landscape, passionately serving our policyholders, intermediaries and other stakeholders. We always aim to act with integrity, fairness and in the best interests of our various stakeholders,” Lambrechts added.
Santam will over the coming days continue to speedily process relief payments to qualifying policyholders.