Loss of supply, a surge on restoration and a grid collapse are three different events on a South African policy. What a broker checks before answering a client.
The power comes back at 19:40 and by 19:45 you have a WhatsApp message: the TV is dead, the gate motor will not respond, and is this covered? It is one of the most common questions a South African brokerage fields, and the honest answer is never a single word. It depends on which of three quite different events actually happened, on whether the surge extension is on the schedule, on the excess that applies, and on wording that insurers have changed more than once since 2022.
Answering it well is not a claims-department task. It is an advice task, and the conversation you have before the outage decides whether the one after it is a service moment or an argument.
Clients use "load shedding" for all of it. Policies do not.
| Event | Typical treatment | What the broker confirms on the schedule |
|---|---|---|
| Loss of supply itself — scheduled load shedding, a substation fault, a municipal outage | No physical damage, so nothing to claim under the main sections. Any cover comes from specific extensions, such as deterioration of stock | Whether a deterioration or spoilage extension exists, and the minimum interruption period that triggers it |
| Power surge or dip damaging equipment, usually when supply is restored | Generally insurable, but commonly as a defined extension with its own excess and its own exclusions rather than as part of accidental damage | Whether surge cover is present, the excess, the sum insured or limit, and whether it extends to fixed machinery, gate motors and electric fencing |
| Grid failure — a total or regional collapse of the national grid | Widely excluded. Reinsurers signalled they would not support the exposure and the Insurance Association has described a grid collapse as an unquantifiable, uninsurable risk | The exact grid-failure wording, and whether it reaches consequential loss such as business interruption |
The distinction that saves most arguments is the second row. An appliance is rarely damaged by the absence of electricity; it is damaged by the spike when electricity returns. So "load shedding damage" claims are, in insurance terms, surge claims — which is exactly why insurers went after the surge wording rather than the outage wording.
One insurer's public trail shows how fast this ground shifts. Santam introduced a grid-failure exclusion in 2022 covering loss "directly or indirectly caused by" a national interruption, failure or suspension of the electricity grid, then clarified in November 2022 that power surge damage remained covered irrespective of whether it was caused directly or indirectly by a grid failure. Months later the position tightened: reporting that surge claims had risen by roughly 50% in twelve months and by more than 200% over three years, the insurer introduced excesses and exclusions on that cover — a fixed excess on personal lines and a percentage-based one with a minimum on commercial lines, applied to new business quotations from 31 March 2023 and to existing clients from 1 June 2023, together with exclusions for surge damage following load shedding beyond twelve consecutive hours, surge arising from grid failure or interruption, and fridge and freezer spoilage caused by any interruption of supply.
Take two things from that, and only two. First, the same insurer's answer to "is a surge covered?" was different in 2022 and in 2023, so any answer you give from memory has a decent chance of being out of date. Second, these are one insurer's terms at particular dates, published on the record; every other insurer on your panel drafted its own, and several have revisited them since. The only document that answers a client's question is that client's current schedule and wording.
Which makes the broker's job a filing job as much as a technical one. If you cannot say, per insurer and per product, whether surge cover is included or optional, what the excess is and how the grid-failure exclusion is drafted, you are guessing on the phone. A one-page panel comparison, refreshed at each round of wording changes, is the cheapest professional-indemnity control in the building.
When the message arrives, the facts you gather in the first hour are worth more than anything you can reconstruct a week later. Work through this list in the thread:
Do not confirm cover in the thread. Acknowledge, gather, register with the insurer, then come back with the position and the excess. Our claim notification on WhatsApp walk-through sets out the sequence, and the claim acknowledgement template gives you wording that confirms receipt without conceding liability. If the outage was widespread and you are dealing with fifty of these at once, the triage approach in our catastrophe claims surge plan applies.
This is ordinary shared-inbox work: photographs and voice notes land against the customer record, the claim conversation is visible to whoever is on duty rather than sitting on one adviser's handset, and a flag on the customer keeps the follow-up from going quiet. In ORIS the acknowledgement goes out from an approved template, the thread stays attached to the customer, and the resulting list can be exported as CSV for the insurer or for your own claims register.
Two proactive moves change the tone of every surge claim you handle afterwards.
The first is a documented cover-review note. When a client declines the surge extension or asks you to strip cover to reduce a premium, put the recommendation and the client's instruction in writing in the thread. That record protects the client's understanding and your file — the same logic as the sum-insured review that keeps average from biting.
The second is a segment message ahead of the periods when your area historically loses supply most often: what the policy covers, what the excess is, and the two things worth doing now — fit surge protection on the expensive items, and keep proof of purchase somewhere retrievable. It is a service message, not a promotion, and it earns replies that surface gaps you did not know were there. If you would like to see how the shared inbox and the customer record fit together on a claim like this, book a walkthrough.
Usually the damage is caused by the surge when supply returns, not by the outage, so the question is whether the policy carries surge cover, what excess applies and whether any exclusion is triggered — for example wording that excludes surge damage after an interruption longer than a stated number of consecutive hours. Check the client's current schedule rather than a general statement about the insurer, because these clauses have been amended repeatedly since 2022.
Load shedding is a managed rotation of supply. Grid failure is a total or regional collapse of the national grid, and it is the event insurers have moved to exclude because reinsurance for it was withdrawn and the Insurance Association has treated the exposure as unquantifiable. Some wordings go further and exclude surge damage arising from a grid failure, which is why the two words are worth separating in front of a client.
Only if a deterioration of stock or spoilage extension applies, and those extensions typically require the interruption to exceed a stated period and often exclude interruptions attributable to grid failure. Commercial clients holding perishable stock should be treated as a separate conversation with their own limit, rather than assumed to be covered under a contents section.
It is a delictual claim for pure economic loss against a public supplier, with a high evidentiary bar, prescription deadlines and its own costs — not a realistic substitute for an insurance claim, and not something a broker should encourage without the client taking legal advice. Where the dispute is with the insurer rather than the supplier, the route after the insurer's internal complaints process is the National Financial Ombud.
Sometimes, in two directions. A few wordings require protection on specified items or apply a different excess where none was fitted, and a device that visibly failed can support the client's account of what happened. Recommend protection on the expensive items as a matter of course, note the recommendation in the file, and do not represent it as a condition of cover unless the wording says so.
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