South Africa, in fact, the entire world, are experiencing unprecedented times. This has contributed to uncertainty within the insurance market with regards to the extent of cover provided by policies due to the pandemic. Claims still need to be “tested” and there would definitely be different interpretations of policy wordings and for this reason, one cannot confirm without a doubt that claims would be successful, but in certain instances, it may be prudent to institute a loss of income/profit claim against your policy.
Companies should refer to their brokers and Insurers to deal with the policy wording referred to as the “fine print” and not just the summarized details in the policy schedule.
Various policies refer to the Consequential Loss Section and an example of such a policy wording reads as follows:
Robbery, Violent Crime, Disease, Pollution, Animal and Shark Attack extension
(Note all covers (a to g) below are limited to a 3 month indemnity period)
Loss as insured by this Section resulting in interruption of Business as a result of:
D. notifiable disease occurring within a radius of 50 kilometres of the premises stated in the schedule
Notifiable disease shall mean illness sustained by any person resulting from any human infectious or human contagious disease,
an outbreak of which the competent authority has stipulated shall be notified to them;
Other policy guides and documents refer and summarise as follows:
Consequential Loss Section
Extensions automatically covered
Loss of income following:
contagious or infectious diseases;
This accordingly will be open to interpretation, however, based on the content, clients with this applicable type product and clause or similar clause may be able to claim loss of income for the lockdown period due to COVID 19( Limited to 3 months or to a period as specified). This will, of course, be very applicable to the Tourism Industry where the effect of COVID 19 will extend far beyond three months.
This is unknown territory and a test period with regards to the success of claims of this manner lies ahead.
It’s certainly worth pursuing in these times