Johannesburg - We have all been there: some months are tougher than others, which necessitates some navel-gazing and a serious cost-benefit analysis. Naturally, the luxuries are the first to go. The DStv, gym memberships, cleaning services, restaurant meals and so forth, but going without the “nice to haves” is unlikely to cripple you financially.
Crashing into a R1 million car or losing all your possessions in a burglary or fire just might. Which is why cancelling your insurance might seem like a great idea at the time but when you need it - and don’t have it - can have devastating consequences.
The South African Insurance Association (SAIA) estimates about 65 percent of drivers on our roads are uninsured, which means millions of drivers are not only chancing it daily, but are also massively exposed because they don’t even have third-party cover. The risk to such drivers is immense, even if they’re ultra-careful. As driving instructors like to say: you’re not likely to be the problem, but you do need to worry about every other person on the road. Which is why we’re taught to drive defensively.
Hard lesson
It’s a lesson Nontlantla Mokati learnt the hard way. Not because she was at fault, but because she was uninsured.
Trimming the fat from her budget, the single mother decided insurance was unaffordable. As a cautious driver, she reasoned if she kept her eye on the road and tried to mitigate most potential crashes, she’d be fine. Then the inevitable happened: someone crashed into her. Luckily, he was insured, so repairing her car seemed like the obvious, and right, thing to do.
If only it were that simple.
Mokati described the incident: “I was involved in an accident on my way home on February 27 near Bramley /Lombardy West in Joburg. On Canning Road, a white Quantum shuttle forced its way into my lane. The taxi in question was indicating right into Keefe Road but suddenly swerved left and drove straight into me. It knocked my electrical mirror off, grazed the driver’s door and fender, bending them as well as the passenger’s door. I and the cars driving down Canning Road had the right of way. The metro police were called to the scene and the taxi driver acknowledged that he was in the wrong.
“After exchanging details, the driver and I agreed to meet at the Sandton traffic department where we would both obtain the accident report. We had also agreed that I would get quotations from panel beaters. Later, the driver said he needed time to gather money for the damages and would get back to us. He never fulfilled his promise of fixing my car to this day. As a result, I had to track down his company to hold it liable for the damages.
“I’m not insured as I cancelled my insurance due to lack of affordability. Not having access to my car has affected my work and I have incurred expenses as a result of finding alternative ways of getting around.”
Evasive action required
It would seem to be a simple insurance claim, but his company’s insurance is only prepared to pay a portion of her claim - which included deducting the value of his claim or excess from her payout.
Justifying their action, a Clarendon Transport Underwriting Managers (Leaders in the Taxi Insurance Industry) agent said: “Please note our offer is based on legal principal, based on merits our offer is 75/25 apportionment in your favour.”
She then cites a 1959 court ruling in the case of Eagle Star Insurance Co Ltd v Sklar: “A driver is entitled to make certain assumptions about the conduct of other drivers, whether he has seen their vehicles or whether their presence is unknown to him because they are hidden by buildings, hedges or other traffic, is, I think, clear. In fact every driver whenever he drives along thoroughfares frequently by other vehicles and pedestrians is constantly and legitimately making assumptions as to their probable behaviour. These assumptions he may have to modify as the behaviour belies expectations, so that usually they must be treated as provisional and subject to further verification.”
“Attached please find release in full and final settlement to be signed and returned together with banking details. Assessed quote attached. Settlement breakdown:
Your damages:
Assessed quote: R37 918
75 percent = R28 438
Our client’s damages:
Repairs: R13 832
25 percent = R3458
R28 438 less R3458 = R24 980
“Please allow 10-15 working days from date signed release sent before following up on payment. Should you disagree with the above we do suggest you obtain legal advise (sic).”
Ombudsman only for insured motorists
Consumers with insurance have recourse with the Short-Term Insurance Ombudsman, but the office cannot assist those who are uninsured, so I contacted the South African Insurance Association about the matter. As the regulatory body for most of the major players in the industry, they are best placed to assist consumers with their gripes.
Their office is particularly concerned about the fact 65 percent of drivers on South African roads are uninsured because that means most of the public are not only at risk, but they also have few options available to them.
Zakes Sondiyazi, an insurance risks manager at SAIA, explained: “Thank you for raising this important topic. The settlement presented to Ms Mokati is due to rules set out in the Apportionment of Damages Act No 34 of 1956 - which lays down how much liability each person carries in the case of a collision between two or more vehicles.
“What this means is that each and every driver has the responsibility to take precautions when driving on the roads. In the event of an accident, even the presumed innocent driver must also be seen to take evasive action to try and avoid the accident.
“Then the insurer will use the advice of assessors and based on relevant case law, the location of the damages, the accident scene and their client’s version of events, the apportionment will be determined.”
Few options if you’re not insured
This, Sondiyazi said, highlights the need for comprehensive insurance because without it, you have few options. The insurer, which is not one of their members but prominent in the taxi industry and underwritten by Hollard, seems to be well within its rights, but Noni has the right to raise the issue with their complaints department - or take it further legally.
“Your own insurance company will have more legal muscle to fight the dispute and also to argue the ruling on the apportionment of damages.
“I suggest the claimant contact the insurance complaints division and present all the supporting evidence showing that evasive action was taken to try and avoid the accident.
“If the claimant is still not happy with the outcome, they can contact SAIA (who will) assist with the way forward.”
The Small Claims Court can be useful, provided the claim is under R15 000 - anything over that, and the matter will have to be assessed by a magistrate’s court, which is costly.
As cliches go, if you’re uninsured, being involved in a crash leaves you up the creek when you have a car that needs repair and no means to get around. To work, to fetch your children, to attend to whatever you might need to. It’s a reflection of the sad state of the economy when 65 percent of drivers are prepared to put themselves at such risk and hope for the best.
WISE UP - HERE’S HOW
Better than nothing
If you can’t afford comprehensive insurance, shop around for third-party insurance - an affordable option that will cover the damage to other cars, but notyour own. It’s handy to have, if you smash into another vehicle.
Where’s the proof?
Zakes Sondiyazi, an insurance risk manager at the South African Insurance Association, suggests you gather as much evidence of the accident as possible - whether or not you were the cause of the accident.
“If you were not responsible and were able to demonstrate that you took evasive action, then you may not be liable for any damages.
“Take photographs of both the vehicles and the accident site from several directions.
“Try to find someone who witnessed the accident - this person must be an independent witness.”
Insured and unhappy?
Contact the Ombudsman for Short-Term Insurance at 011 726 8900, visit
Georgina Crouth is a consumer watchdog with serious bite. Write to her at [email protected].
Follow Georgie on Twitter: @askgeorgie
The Star