Guardrisk to appeal ruling
REASON: INSURANCE COMPANY’S MOVE IS TO GET ‘CERTAINTY FOR INDUSTRY, POLICYHOLDERS’
Café Chameleon lawyer confident of being successful in case.
Guardrisk – the shortterm insurance subsidiary of JSE-listed financial services giant Momentum Metropolitan – has confirmed it will be appealing the Western Cape High Court ruling that it must pay out a business interruption insurance claim to local restaurant Café Chameleon.
This follows the Cape Town establishment successfully securing at declaratory order against Guardrisk in a landmark victory in late June for non-payment of a claim linked to the Covid-19 pandemic.
“After careful consideration, we have decided to approach the court for leave to appeal the judgment. It is important that we do so in order to obtain certainty for the industry, our business and for our policyholders going forward,”
Guardrisk said in a statement.
“The issues we are grappling with, as highlighted by the court proceedings, are not confined to Guardrisk, or even to South Africa, as is evident by the extent of litigation around the same issues currently occurring in the USA, UK, Europe, and Australia.”
“We are in continuous consultation with the relevant authorities to ensure that we deal with claimants and all policyholders fairly.
This appeal process is likely to be lengthy and as stated, Guardrisk is committed, via HIC, our appointed underwriting manager and its brokers, to implement relief measures that will enable policyholders to weather this challenging time,” it added.
Guardrisk’s move and statement comes despite the Financial Sector Conduct Authority (FSCA) last week issuing a strongly worded statement saying that the national lockdown (to initially curb the spread of Covid-19) cannot be used by any insurer as grounds to reject a claim related to business interruption insurance policies that have infectious disease cover.
“The devastation that the Covid-19 pandemic and the lockdown regulations have and continue to wreak on us as a society is unprecedented,” Guardrisk noted in its latest statement.
“The extraordinary scale of the economic fallout in SA resulting from this, has reaffirmed that we, as Guardrisk, have an important role to play in helping people to navigate through this difficult time,” the group added.
“As such, we have been exploring avenues to provide support to businesses in the tourism and hospitality sector to help keep their doors open.
“We are continuing this process to implement measures of support and we will communicate these to our policyholders as soon as possible,” it said.
Responding to Guardrisk’s decision to appeal the judgment, Café Chameleon’s lawyer Ren Dunster of Dunster Attorneys said: “I think everyone is presuming that leave to appeal will be granted because of its [the case’s] significance, but the reality is that this is a solid judgment.”