These are enormous, entirely unprecedented and will last for years to come. Second, it also depends on how deep Sasria’s reserves and reinsurance run, in comparison to the scale of claims that have been incurred. In other words, what started the chain of events that led to the loss and was that chain unbroken by any other intervening event. These losses are yet to be quantified but all indications are that they may run into the tens of billions of rands.Īlthough Sasria believes it has the depth of funds to cover claims, whether it will pay out depends on two key factors: first, what is known as “proximate cause”. The types of losses being suffered are for the most part losses to assets, buildings, stock, vehicles and losses related to business interruption - more specifically, a loss of earnings.

This is unique cover against risks such as civil commotion, public disorder, strikes, riots and terrorism, making South Africa one of the few countries in the world that provide this insurance”. In its stead, we have a government-owned insurer called the South African Special Risks Insurance Association, or Sasria.Īccording to Sasria, it is “the only non-life insurer that provides special risk cover to all individuals and businesses that own assets in South Africa, as well as government entities. In South Africa, due to our history, commercial and private insurers exclude from cover events motivated by political or social unrest. The wave of violent riots and criminal looting that has swamped large parts of Gauteng and KwaZulu-Natal this week demands an equally swift and immediate response from our economic safety net: the dedicated riot and public disorder cover that Sasria provides. The entire insurance industry must urgently band together to provide capacity and skills in this unprecedented scenario. As South African businesses face losses that are likely to run to tens of billions of rands arising from the current spate of looting and destruction, the capacity of the country’s insurance safety net becomes a critical question for the survival of these businesses.

Riot civil unrest pozo soton unwinnable