by Aleshia van der Ploeg
The recent invasion of the Ukraine got me thinking about the affect war has on all our contracts as well as our insurance. Unfortunately war is never good news.
War?
War is defined as a state of armed conflict between different countries or different groups within a country.
How does it affect our contracts?
Most contracts contain a ‘force majeure’ clause – this is an unforeseeable circumstances that may prevent someone from fulfilling a contract. War is generally considered as a force majeure event and therefore a party may be relieved of its obligations in a contract for the duration of the war and cannot be held liable for any delay or failure in the performance of its obligations in the contract. In some circumstances, should the war or force majeure persist, this would entitle a party to cancel a contract.
Insurance
Motor vehicle, homeowners, commercial property, fire, travel and life insurance policies often have war exclusions. With these exclusions, the policy will not pay for losses from due to war. Insurance companies also do not pay for any claims caused by or contributed to by an act of war. An insurance company is therefore protected from having to pay out claims on automobiles, homes, and the like, if the damage was caused by war. War risk insurance is offered as a separate policy as it is excluded from standard insurance policies due to the high risks involved.
What can I do?
Did you know that you are generally not covered for damages in the event of natural disasters such as floods and earthquakes? Read all your contracts and insurance policies carefully. Know and understand exactly under which circumstances you may or may not be covered to avoid a nasty surprise further down the line. Request legal assistance if you don’t understand what you are signing. And always choose PEACE.
Aleshia van Der Ploeg LLB (RAU) was admitted as an Attorney of the High Court in South Africa in 2006. She is a member of the Law Society of the Northern provinces. She has 10 years post-qualification experience in corporate, commercial, labour and general law. She practised as an attorney and served as a Director before forming her own consulting firm. www.vdplegal.co.za | Email aleshia@vdplegal.co.za
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