By Angelique Ruzicka, editor, Justmoney
Absa have issued a statement saying that clients who were affected by the Orkney incident will have their claims upheld. This comes after research conducted by Justmoney
which found that the Absa idirect insurance policy wording on the bank’s website states that it will compensate clients for ‘Earthquake, except for earth tremors caused by mining operations.”
But Dante Mashile, group media relations manager for Absa said: “Absa's Home Owners Policy does in fact cover damage caused by mining-related earth tremors. We received approximately 1100 claims linked to the event on 5 August and are in the process of finalising these as and when the estimations reports come through. We are fully committed to ensuring that our customers affected by the tremors are settled in the quickest possible time.”
The Council for Geoscience told Justmoney earlier this month that the Orkney earthquake was mining related.
Absa was not the only provider which had this type of clause in its insurance policies as Justmoney reported earlier in the week.
Meanwhile, underwriter MUA Insurance Acceptances revealed this week that following the Orkney incident it had changed the wording on its insurance policy. “Following the 5.5 magnitude tremor experienced in Gauteng and other parts of South Africa on Tuesday 05 August 2014, MUA reviewed its policy wording and decided to remove an antiquated exclusion which previously excluded damage caused by an earthquake, if it was determined that the earthquake was caused by mining-related activities. MUA realised that this exclusion was historical in nature and removed this exclusion in order to treat customers more fairly, in line with the Treating Customers Fairly (TCF) legislation,” said Christelle Fourie, managing director of MUA in a statement.
She added: “Following this change to the policy wording made on 8 August 2014, all MUA clients – new and existing – now benefit from full cover for any damage caused by any earthquake with no exclusions. Furthermore, this benefit will be applied retroactively to cover all losses reported as a result of the 5 August 2014 earthquake MUA has admitted liability for all claims reported to us during this period.”
Finally broker Addsure, which was included in the survey, said that it is advising its clients to take out newer policies that provide wider coverage: “Some older policies issued by insurers have exclusions such as mining related causes. Addsure does not issue policies. Addsure advise clients to take out the wider and newer type policies. Sectional Title require earthquake cover and we arrange such, mining activity included,” said Mike Addison, director of Addsure.