Published Date: August 24, 2021

Whilst the dust seems to have settled and the talk of recent riots and violence has calmed down, the vast majority of affected businesses are still grappling with the aftermath of the chaos. Insurers and SASRIA are naturally at the center of the aftermath. Most businesses would have lodged their insurance and/or SASRIA claims by now. Business insurance disputes are not a novel phenomenon although they have gained significant traction in recent months due to the Covid-19 pandemic and, most recently, the riots and violence. Against this background, it is critical that all businesses – small, medium, and large –are aware of the legal generalities and processes when facing potential legal disputes with their insurers. As such, this short piece purports to briefly touch, inter alia, on the following aspects: time-barring clauses and prescription; alternative dispute resolution platforms; evidence necessary in such disputes; duration and costs of the dispute resolution process.

Time-barring clauses and prescription:

Time barring clauses are prevalent in insurance contracts. These clauses provide for a specified time period within which an insured should submit a business claim and institute action should a claim be rejected. For example, an insurance policy may state that when a triggering event occurs, an insured has to submit a claim within 30 days, and to institute any legal action (if so necessary) within 6 months. In this way, the parties set their own prescription periods and contract out of the “normal” prescription periods as per the Prescription Act. If, however, the policy is silent on the time period within which a legal dispute will need to be instituted, then the provisions of the Prescription Act apply by default. Generally, prescriptionis regulated by the Prescription Act 68 of 1969. According to the said statute, a “debt” prescribes after a period of 3 years. It is, therefore, crucial to promptly establish whether the policy concerned contains a time-barring clause or not.

Dispute resolution platform:


Whenever there is a dispute between an insurer and the insured, it is always prudent to first attempt to amicably resolve the dispute. An insured business does not necessarily need any legal representation for settlement negotiations with an insurer, however, it is, for several reasons, advisable to seek legal advice before reaching a settlement. Firstly, an insurance policy is a legal contract and, therefore, a legal specialist is better positioned to interpret the terms of such contract and to opine on the legality, lawfulness, and enforceability of its terms. Secondly,a legal specialist is likely to facilitate settlement much faster.

Ombudsmen’s office:

Insurance disputes may be lodged with the Ombudsmen’s office. The parties make written submissions, and a decision is made, accordingly. Although there is no need for a legal representation for this platform, it is advisable to have a specialist to draft the submissions, for numerous reasons.


A mediator oversees the settlement negotiations. S/he does not make a ruling but endeavours to facilitate settlement between parties. It is a time-saving and cost-effective process.


In arbitration, the arbitrator(s), preside over the proceedings and make a binding ruling. Depending on the terms of the arbitration agreement, a ruling may be appealable or not. The arbitration usually comes at a price, especially where issues are complex. It is, nonetheless, time – saving.

Court litigation:

Depending on the nature of the dispute, court proceedings may take the form of either a trial or a motion. If it takes a trial route, it will naturally take much longer because of the trial concomitant processes. If it goes the motion route, it will be quicker. The litigation route is beneficial in a sense that a Judge presides over the case and makes a binding decision. That said, the court’s decision remains appealable.

Duration and costs:

This aspect has been touched on above. Duration and costs are determined by the chosen platform.


The above-discussed aspects relevant to insurance claims may become more prevalent for businesses, if any legal disputes occur from the recent riots. That said, each dispute always brings its own peculiar circumstances which largely dictate which direction the matter takes.