The third wave of the coronavirus has necessitated a top-up of insurance giant Liberty Holding’s pandemic reserve, which it set up last year to provide for the expected impact of Covid-19 on its business.
In a trading statement on Thursday, the company said: “Consistent with the Beta variant being more severe than the first variants in SA, the impact in 2021 on mortality of the second wave exceeded expectations in the SA Retail and Lib-Hold Corporate businesses.
“This, together with the impact of the current third wave and the associated prevalence of the Delta variant, has necessitated a top-up of the pandemic reserve.
“Although the rollout of SA’s vaccination programme is gaining impetus and will go some way to mitigate the rate and severity of infections, the short-term impact of the pandemic remains uncertain.”
So far, 70,908 people in SA have died of Covid-19 related complications, including 520 deaths reported overnight.
On Wednesday evening, the National Institute for Communicable Diseases said 17,351 new Covid-19 cases had been identified in SA in the 24-hour reporting period, bringing the total number of laboratory-confirmed cases to 2,408,525. This increase represents a 24.4% positivity rate.
Lib-Hold said it continues to remain well-capitalised, with Liberty Group Ltd remaining comfortably within the capital coverage target range of 1.5 to 2.0 times after taking account of the ongoing operational affects of the pandemic and the increase in the pandemic reserve, demonstrating the financial strength of the business.
SA’s life assurance industry had already recorded 116,774 more death claims in 2020 than it did in 2019, an increase of 37%, the Association for Savings and Investment SA (Asisa) reported in March.
Business Times reported that Sanlam expected excess claims in 2021 to be two to three times the level of 2020, as the impact of the second and subsequent waves of Covid-19 infection filter through.