Insurance ombudsman refunds almost R300m to consumers in 2020
The offices of the Short-term (OSTI) and Long-term Insurance Ombudsman (OLTI) recovered and refunded almost R300 million (about US$21.4 million) to aggrieved consumers, according to their 2020 joint report.
DURBAN, May 18 (ANA) – The offices of the Short-term (OSTI) and Long-term Insurance Ombudsman (OLTI) recovered and refunded almost R300 million (about US$21.4 million) to aggrieved consumers, according to their 2020 joint report published on Tuesday.
Both the OSTI and OLTI offices said that it lodged more complaints during 2020 than the year prior, with the OSTI recovering R119,548,901 in consumer complaints and the OLTI recovering R177.9 million.
The results marked the first-ever joint report submitted since the amalgamation between the OSTI and the OLTI.
CEO of OSTI Edite Teixeira-Mckinon said that it had received a total of 11,095 new complaints, signifying a 7% increase since the last recorded period. It closed a total of 10,805 complaints, a closure success rate of 97.3%.
A total of 7% (786) of the OSTI complaints received were directly related to the Covid-19 virus. Five hundred and sixty-two were related to business interruption insurance and 224 relating to travel insurance.
Teixeira-Mckinon said that the OSTI’s list of outstanding complaints for six months or longer decreased from 739 in January to 575 at the end of December.
The OSTI lodged 2,100 homeowner disputes (a 15% increase) during 2020, with a majority of those complaints being claim rejections due to aesthetic issues.
“Often, an evaluation of the building is conducted by the bank at the time of the purchase to establish whether the property is of sufficient value to act as security for the loan. The evaluator does not inspect the property for insurance purposes.
“As such, the assessment does not warrant that the property is free from underlying structural defects, wear and tear or other maintenance-related issues that may affect the outcome of a future claim,” the OSTI said in a statement on Tuesday.
Deputy ombudsman for the OLTI Jennifer Preiss said that their office received the highest-ever number of complaints in a year for the same recorded period, with 14,198.
Declined insurance claims accounted for more than 50% of its total complaints received during 2020, the OLTI said.
A total of 6,756 complaints received were chargeable.
The OLTI achieved a closure rate of 45.8% during 2020, with 6,512 complaints being finalised.
A total of 456 complaints received were directly related to the Covid-19 virus, which were primarily made up of retrenchment and inability to earn an income.
During the course of the Covid-19 pandemic in South Africa, the government had announced a Temporary Employee/Employer Relief Scheme (TERS) benefit which would be paid to eligible employees.
The OLTI said, in terms of the TERS benefit, that it “cannot be regarded as income earned and, therefore, cannot be the reason for a claim to be declined”.
– African News Agency (ANA); Editing by Yaron Blecher
