Insurance industry can’t foot the bill for COVID-19 damages
Wednesday, 10 07 2020, Category: Insurance and Reinsurance, Country: World
The costs of global pandemics such as COVID-19 exceed the capacity of the global insurance industry, making them effectively “uninsurable risks”, Beat Strebel, Swiss Re’s head of Middle East and Africa, tells The Africa Report.
Swiss Re has “no appetite” to insure or reinsure against pandemics, said Strebel, who is based in Cape Town.
Compensating businesses for the disruption they have suffered is a job for governments, with whom Swiss Re wants to engage to create public-private partnerships, he added. “We can’t do it alone.”
In South Africa, liability for losses caused by lockdown has become a legal issue.
Hospitality companies have taken South Africa’s largest general insurer Santam to court to challenge its attempts to avoid paying out for COVID-19 losses.
Santam argues that the pandemic itself and government’s lockdown response are two separate events.