Beware, the proximate cause of loss
Turning to buildings and homeowners` insurance complaints, the main contributors stood out as claims being rejected on the basis of a policy exclusion; gradual deterioration; lack of mainte-nance; or wear and tear. The OSTI commented that although an insured peril or event may have occurred, such as a storm, the proximate cause of damage was often due to a structural defect, lack of maintenance, or a gradually occurring loss.
For example, an insurer will argue that `but for the structural defect or the wear and tear, the home would have been able to withstand the storm. Again, the insurer must prove its rejection on a balance of probabilities.
Insurers will enjoy Teixeira-Mckinon`s comment on non-life insurers` raison d`étre: "Insurance covers damage that is caused by unforeseen, single, and sudden events as listed in the policies and not damage that has occurred gradually over time". This is something the OSTI has focused on through various consumer awareness initiatives that highlight the responsibility of homeowners to maintain their properties and ensure that their buildings are structurally sound.
Leaving the best for last, the OSTI said, "The recorded monetary benefit or value for insureds who approached the office for assistance amounted to just over ZAR109 million for 2022, with the majority of complaints resolved through conciliation without the office having to issue a formal recommendation". One deter-mination was issued against an insurer.
Gareth Stokes
Stokes Media