Short-term insurers returned from their annual conference at Sun City on Wednesday to a mountain of paperwork.
All insurers have seen a spike in claims for July as severe weather has hit all three of South Africa’s major metropolitan areas.
According to Willem Roos, CE of Outsurance, the leading direct personal lines insurer, there has been 10 times the usual number of weather-related claims for the last week in July – with 2000 claims, mostly on the property book rather than the motor book.
Outsurance insured one of the shops at Phumulani Mall in Tembisa that was severely damaged in Tuesday’s tornado.
“Though this isn’t the first time we have had a freak incident at this time of year – the 2014 Orkney earthquake happened on August 5,” said Roos.
July is usually one of the best months for insurers, when there is dry weather in Gauteng, which accounts for more than 40% of SA’s insured assets. It is the month they expect to replenish their balance sheets in time for the large hailstorms, which are usually clustered around October and November.
But Roos said the claims were under the limits at which Outsurance would claim back under its reinsurance treaties. In insurance terms this week’s inclement weather did not qualify as a catastrophic event yet – it would not match the 2012 East Rand hailstorm when short-term insurance claims touched R1-billion.
Hollard head of claims Mandla Tshezi, who dealt with 200 weather-related claims last Monday and Tuesday, said the hailstones that fell on the Copperleaf estate in Centurion were the size of a R2 coin, not the size of golf balls, which was common in the catastrophic hailstorms of the past.
Mutual & Federal finance director Jaco van der Sandt said insurers would not know if they had made an underwriting profit until the fourth quarter was over. The last few days would not have helped as there had been a large increase from Mutual & Federal’s typical 500 claims a week.
“But the majority of claims have been from homeowners’ insurance, which is most often placed with the banks or with direct insurers, so the effect on mainstream insurers would have been limited,” he said.
Donald Kau, head of corporate affairs at Santam, reported a large influx in claims from Gauteng and KwaZulu-Natal after Tuesday’s rainfall. The industry expected hail in the early and latter parts of summer, but the weather was becoming unpredictable.
Discovery Insurer, CE Anton Ossip, said there had been an increase in weather-related claims as well as a slight increase in theft-related claims.
Discovery’s motor accident frequency was falling, which Ossip attributed to its Vitalitydrive programme designed to encourage good driving.
Insurers count cost of stormy weather
All insurers have seen a spike in claims for July as severe weather has hit all three of South Africa’s major metropolitan areas.
According to Willem Roos, CE of Outsurance, the leading direct personal lines insurer, there has been 10 times the usual number of weather-related claims for the last week in July – with 2000 claims, mostly on the property book rather than the motor book.
Outsurance insured one of the shops at Phumulani Mall in Tembisa that was severely damaged in Tuesday’s tornado.
“Though this isn’t the first time we have had a freak incident at this time of year – the 2014 Orkney earthquake happened on August 5,” said Roos.
July is usually one of the best months for insurers, when there is dry weather in Gauteng, which accounts for more than 40% of SA’s insured assets. It is the month they expect to replenish their balance sheets in time for the large hailstorms, which are usually clustered around October and November.
But Roos said the claims were under the limits at which Outsurance would claim back under its reinsurance treaties. In insurance terms this week’s inclement weather did not qualify as a catastrophic event yet – it would not match the 2012 East Rand hailstorm when short-term insurance claims touched R1-billion.
Hollard head of claims Mandla Tshezi, who dealt with 200 weather-related claims last Monday and Tuesday, said the hailstones that fell on the Copperleaf estate in Centurion were the size of a R2 coin, not the size of golf balls, which was common in the catastrophic hailstorms of the past.
Mutual & Federal finance director Jaco van der Sandt said insurers would not know if they had made an underwriting profit until the fourth quarter was over. The last few days would not have helped as there had been a large increase from Mutual & Federal’s typical 500 claims a week.
“But the majority of claims have been from homeowners’ insurance, which is most often placed with the banks or with direct insurers, so the effect on mainstream insurers would have been limited,” he said.
Donald Kau, head of corporate affairs at Santam, reported a large influx in claims from Gauteng and KwaZulu-Natal after Tuesday’s rainfall. The industry expected hail in the early and latter parts of summer, but the weather was becoming unpredictable.
Discovery Insurer, CE Anton Ossip, said there had been an increase in weather-related claims as well as a slight increase in theft-related claims.
Discovery’s motor accident frequency was falling, which Ossip attributed to its Vitalitydrive programme designed to encourage good driving.
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