Insurers expect claims to rise on Cape storm and fires
Analysts warn the twin disasters of Knysna fires and the storm that hit Cape Town will put pressure on the insurance business
SA’s insurers are bracing for an influx of claims, expected to increase after the outbreak of fires in Knysna damaged property worth millions of rand and resulted in the evacuation of about 10,000 people from their homes. Analysts on Thursday said the twin disasters of fires in the coastal town of Knysna and the storm that hit Cape Town this week would put pressure on the insurance business, although a cushion would be provided by reinsurance cover taken out by insurers. Reinsurance cover is insurance for insurers and is the practice of insurers transferring portions of risk portfolios to other parties. “The fires and storm will be claimed as an event and would be covered under the reinsurance cover which insurers are part of. Insurance companies like Santam have reinsurance cover in place and that limits insurers like Santam’s losses to a cap amount. This varies around R50m and R100m per catastrophic event like the recent floods or fires,” said Adrian Cloete, portfolio manager at P...
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