It was no surprise when the tenth Allianz Risk Barometer – released in January this year – listed Business Interruption, Pandemic Outbreak and Cybersecurity Incidents respectively as the COVID-19 trio top global business risks.
The trio are reflective of the socio-economic disruption predominantly caused by lockdowns in many countries over the past year.
This time of year has also become synonymous with rampant #FeesMustFall protests nationally, which have sometimes resulted in the massive destruction of property. For instance, between October 2015 and May 2016, 18 universities suffered damages totaling almost R460-million. These disruptions and intentional property damages also had a huge negative impact on the economy as a whole, specifically to the country’s possible foreign investment prospects.
What does this mean for South African business leaders and property owners? As much as these protests are meant to be peaceful, history has proved that they are most likely to end up with some level of rather costly damage to property. This is why property owners have to ensure that they are properly and adequately covered for damage on their properties and businesses – to mitigate against special risk incidents.
What exactly does Material Damage Cover include?
Having a proper and adequate insurance cover is like having a security blanket for when the unthinkable happens, especially for a business. For that, Sasria’s Material Damage includes cover for assets against losses or damages of all domestic and commercial property, stock, computer equipment, containers, aviation hull, and agricultural-related assets such as harvest and livestock. These losses are only covered if incurred as a result of special risk incidents such as civil commotion, strikes, riot, public disorder or terrorism.
Material Damage Extensions
Material damage cover can be extended to include optional extensions at an additional premium. Some of these are escalation and inflation, claims preparation costs and security costs. Furthermore, if the underlying insurer has an extension on their cover, it does not mean one automatically has the same extension with Sasria.
What about looting?
Looting will only be covered when Sasria related incidents such as strikes, riots and public disorder are operative at the time of loss.
Looking at recent occurrences involving looting can better illustrate some of the incidents not covered by Sasria. For instance, as the country was entering the fourth week of national lockdown due to COVID-19, the Western Cape government was reported to have been on high alert as incidents of grocery and food parcel trucks were pelted with stones, mobbed and looted. Another incident was reported of a truck that was looted while stuck on the side of the road.
In all these looting incidents, citizens were seen taking stock from the trucks leaving the road freight companies with heavy financial loses. These were clear acts of criminality which do not fall under special risk incidents covered by Sasria.
Adequate cover is not a nice to have, it is essential
While 2021 is part of the big global reset and recovery from the devastating impact of COVID-19, business leaders and property owners have to build resilience even in the face of the ongoing pandemic and its resultant threats.
When considering Sasria’s Material Damage Cover, customers need to ensure that they speak to their insurance company or broker to fully understand the terms and conditions of this cover, as well as the various options available, to ensure that one is adequately covered.
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