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Insurers Brace for Fallout After South Africa Virus Claims Rise

  • Country still in the grip of third wave with fourth predicted
  • Regulator scolds industry for high burial-cover fee increases
South African Vaccinations in Sandton Business District
Photographer: Waldo Swiegers/Bloomberg

South African insurers are strengthening their defense against potential new waves of coronavirus infections as worse-than-expected mortality claims emerge from the ongoing pandemic.

Old Mutual Group Ltd. has bulked up its Covid-19 provisions by 2 billion rand ($135 million) to account for an ongoing surge and a potential fourth spike in cases, according to a statement Wednesday. Smaller peer Momentum Metropolitan Holdings Ltd. is also adding more to its reserves, while Absa Group Ltd. saw first-half insurance revenue fall after setting aside provisions and paying out more claims.