INSURANCE CLAIMS AGAINST ETHEKWINI MUNICIPALITY FOR POWER OUTAGES

This press release was emailed out at : 20 January, 2012 18:30
_________________________________________________________________

Statement from the Deputy Head, Finance, Pensions and Major ProjectscMr Jay Balwanth:

1. Introduction
   As a result of recent power outages in the Bluff, Woodlands and Montclair areas, many residents lost perishables that had been refrigerated and are now seeking compensation from the Municipality for their losses.
   
   Any person may lodge a claim against eThekwini Municipality for a loss or damage that he has allegedly suffered as a result of wrong doing on the part of the Municipality.
   
   For any claim to be successful, a claimant has to prove negligence on the part of the Municipality which resulted in the loss or damage.
   
   In nearly all cases, the interruption in power supply is occasioned by factors beyond the control of the Municipality and is not as a result of negligence.
   
   
   
2. How Self-Insurance Reserve for eThekwini Municipality Works
   EThekwini Municipality operates a self insurance scheme which is aligned with the best practices in the insurance industry. It covers the assets and liabilities of the Municipality subject to all the relevant laws of the country and Municipal policies, regulations as well as by-laws.
   
   The Self insurance scheme was never intended to be a substitute to cover risk of loss/damage to any ratepayer's personal property. It is expected that ratepayers will procure their own personal insurance covers to protect their property and other assets.
   
   
3. Investigation Reports
   Before any claim is settled, a full technical investigation report has to be completed in respect of the circumstances that led to the interruption of electricity supply. This report determines whether or not there has been negligence on the part of the Municipality. If the findings show there has been such negligence, subject to specific conditions, the Municipality will have to compensate those who suffered losses or damages.
   
   
4. In what circumstances will claims be paid?
   EThekwini Municipality can only pay a claim where:
   • the circumstances of loss or damage reveal that the Municipality acted negligently;
   • the circumstances of the loss are not inconsistent with Electricity Supply By-Laws (see below the relevant sections);
   • the claimant has proved his/her loss or damage;
   • the claimant has provided the proof of a fair and reasonable quantum;
   • no claim has been made and paid by personal insurance covering the same loss; and
   • any other additional information requested has been received.

Section 18, paragraphs (1) and (2), of eThekwini Municipality Electricity Supply By-Laws indemnifies the Municipality against actions or claim arising out of any incidents quoted in the relevant sections below:

1. The Council shall not be held liable for any loss or damage, direct or consequential, due to or arising from any interruption, diminution or discontinuance of the supply of electricity or any temporary increase or surge therein accessioned by a strike, blackout, war, act of God, legislative action or embargo or any other cause beyond the Council's control or by any fault occurring in the machinery, supply or service mains or other apparatus of the Council or by the rectification of any such fault. The consumer is deemed to hold the Council indemnified against any action, claim, expense or demand arising form or in connection with any of the matters aforesaid.
   
   
2. The Engineer may without notice, interrupt the supply of electricity to any premises for the purpose of carrying out emergency repairs to the supply or service mains.

Contact Person
Claim Forms are available from the Municipality's Insurance Unit via email: claims@durban.gov.za

Insurance Claims Enquiries: Tel. 031 311 1552 or 031 311 1551.
Contact person: Thulani Ntuli, Manager: Insurance