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More than 300 people died and around 3,000 stores were looted
when protests and violence erupted in July, sparked by the
imprisonment of former President Jacob Zuma but later driven by
anger over poverty and inequality.
Sasria, which was set up after private firms stopped
underwriting risks relating to political violence due to unrest
during apartheid, relied on reinsurance contracts to pay part of
the billions of rand in claims it generated.
But the cost of those contracts were now increasing, managing
director Cedric Masondo told Reuters by phone.
"We will increase the rate driven by the increase in
reinsurance," he said, adding the timing had not been finalised
and declining to say by how much.
A circular communicating the decision to Sasria agents - local
private insurers - was published on its website and dated Aug.
4. It said the increase would be effective from Oct. 1.
As the only entity offering insurance coverage for political
risks, such as strikes or protests, that could mean firms across
the country that want protection are in line for higher
premiums, though Masondo said it was still deciding whether all
clients would be affected.
The insurer's standard coverage offered by agents runs to a
maximum of 500 million rand ($33 million), while an additional 1
billion rand is available to bigger firms that approach Sasria
directly.
Some coverage is also available on the open market, in
particular for large corporates looking for protection beyond
the 1.5 billion rand maximum Sasria offers.
A senior executive at one global insurer, who declined to be
identified, told Reuters that it would also increase its
property insurance rates as a result of Sasria's decision.
($1 = 15.1330 rand)
(Reporting by Emma Rumney and Promit Mukherjee; Writing by Emma
Rumney; Editing by Mike Harrison)
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