As the tourism industry struggles to find their footing during the pandemic, with thousands of jobs on the line, they are now fighting back at insurance companies who refuse to pay out their claims.
Receiving no joy from these big insurance companies, the tourism industry launched an online petition calling on their insurance providers to pay out on their business interruption claims. The petition calls on all South Africans, including the business sector, to support their cause by signing the petition and by re-evaluating their insurance providers.
Many of these businesses are facing imminent closure, which will result in a broken tourism sector and the loss of thousands of jobs, which they say can be avoided if insurers honour their contractual obligations and pay out on these claims.
Restaurants, hotels, lodges, cafes and other tourism businesses took out Business Interruption insurance that includes cover for infectious and notifiable diseases well before the pandemic began.
However, numerous companies are rejecting claims, saying that government’s lockdown, and not the Covid-19 pandemic, is responsible for the deep losses experienced by these small and medium businesses.
CEO of the MORE Family Collection, Robert More, who started the petitions revealed a recent case. He said this week, the Western Cape High Court compelled Guardrisk to honour the Covid-19 Business Interruption insurance claims of Cafe Chameleon, a restaurant in Cape Town.
The judge rejected Guardrisk’s argument that the losses suffered by the claimant were due to the lockdown, and not the Covid-19 pandemic.
“All along, the insurers have said that they need the courts to provide legal certainty that they are liable before they honour their clients’ claims. We now have that certainty, but we don’t see any insurer stepping up.
"The true test of a company’s ethics and values is how they treat their most vulnerable customers at their time of need. The actions of these insurance goliaths don’t match their words, which are all centred on behaving responsibly and in line with deep ethical values. Actions speak louder than words, and their actions continue to be unethical, ” he said.
More said that the sector is going through undue stress due to the pandemic, with job losses not so far away.
“By paying out our claims, the insurers can save jobs in our vulnerable sector, and by saving jobs, they have the power to save lives in our country right now. People are starving.
“South Africans have a long history of coming together in a time of crisis. We implore all our countrymen and women to join us in holding these insurance giants to account. This will not only save our tourism sector, which we all love and need but also the many thousands of jobs it sustains," he said.
Business Interruption insurance exists to help companies survive an unanticipated event. There are generally two types of BI insurance: a basic policy and a tourism/hospitality policy.
The basic policy requires physical damage to the business premises to trigger a claim while a tourism/ hospitality policy contains a specific extension that includes interruption by infectious or contagious notifiable disease. These companies all have the latter.
Sign the petition here.