vrs Alacc_succesfully resolves claim for extensive timber losses

1. Due to South Africa’s ideal climate for growing timber, a profitable timber industry has developed to service the
paper production, furniture manufacture and construction sectors. As timber plantation risks are fairly large
and extensive, they are primarily insured with Lloyd’s syndicates.
vrs Alacc has dealt with several large plantation losses over the years for several large South African timber
producers who lease plantations as well as owning them.
vrs Alacc successfully resolves claim for
extensive timber losses

2. One of the claims handled was for a significant player in the timber market, which owns and leases several
plantations throughout South Africa and Swaziland and operates several saw mills supplying both local and
international markets.
Due to forecasted hot weather and the increased Fire Danger Index, the timber growers in the Piet Retief area
of Mpumalanga, South Africa, placed their fire-fighting crews on standby.
...
Rapidly spreading plantation fire

3. ...
At around 1pm one August Saturday, a fire was reported to be burning out of control on the north-west por-
tion of the insured’s plantation, as well on the neighbouring plantation.
With the assistance of neighbouring timber growers, the fire was brought under control just before midnight.
The following day, Sunday, the Fire Danger Index was increased further due to the prevailing hot and dry condi-
tions, and the local fire authorities advised that no
controlled burns should be undertaken.
Early in the morning, eye witnesses reported that a back-burning operation had been put into effect on the
timber plantation adjacent to the insured’s property. Although the fire appeared to be under control at the time,
the insured’s employees undertook a patrol of the boundary between the insured’s property and its neighbours.
By 11am, the fire started by the neighbour had increased in size and intensity and was out of control and
beginning to move towards the insured’s property.
The fire spread onto the insured’s property and, due to the high temperatures and high velocity winds, could not
be contained and spread throughout the insured’s property and other neighbouring plantations.
There was extensive damage to around 324 hectares (Ha) of the insured’s standing timber, comprising 171
Ha of Eucalypts and 153 Ha of Pine specie.

4. The loss adjusting team from vrs Alacc provided compartments maps, indicating the specie and age of
damaged standing timber, and undertook ground inspections and cambium tests of damaged timber in
each compartment.
Aerial photographs of the burnt areas were obtained and the affected areas were re-measured.
Several discrepancies between the actual affected areas and the information provided on the maps were
found. After conducting further in loco inspections, the discrepancies were discussed with the insured and
the claim agreed in terms of the policy.
Salvage operations were undertaken but, due to the extent of damage to standing timber, the only market avail-
able was for charcoal production netting a clawback of 13% of the total agreed claim.
Thereafter, a recovery action was pursued against the owner of the property from where the fire had originated
and, after protracted negotiations and the involvement of attorneys, a final settlement was agreed and accept-
ed by insurers.
vrs Alacc adjusters quickly on site to evaluate
the loss