Insurers that belong to the SA Insurance Association (SAIA) should not reject claims solely because a driver’s licence has expired. SAIA was responding to a question about the implications for drivers who are involved in an accident without a valid driving licence card because of the backlog in issuing cards.
The Department of Transport said there was a backlog of 383 000 cards by 1 December 2021 because the machine that produces the cards had broken down in November.
Transport Minister Fikile Mbalula said last week the machine is being fixed in Germany and should be back in South Africa by March.
In a statement this week, SAIA said its motor insurance members have experienced this situation before, “and all motor-related claims during such periods have been handled quite well”.
It was referring to the hard lockdown in 2020 and the introduction of card licences in March 1998, when there were huge backlogs in the issuing and renewal of driver’s licences.
“Although each insurer would treat each claim in accordance with their rules and procedures, generally and in principle, motor members are expected to look at the full merits of the claim holistically before reaching a decision and not reject claims solely on the basis that a driver’s licence had expired,” SAIA said.
It said an insurer would examine:
- Whether the claim was because of an insured event (accident, fire, water damage, etc);
- Whether the damaged vehicle was insured;
- Who the regular driver is;
- Whether the vehicle was used for private or business purposes; and
- Any other material matter or information that could have prejudiced the insurer.
SAIA referred to a statement issued by Brian Martin, the then Ombudsman for Short-Term Insurance, in May 2007.
The statement said: “The Office of the Ombudsman for Short-term Insurance has been mandated to apply both the law and equity when resolving complaints. Should we receive a complaint where an insurer has rejected a claim because the driver did not have a valid driver’s licence, or a vehicle was not roadworthy due to an expired licence disc, we would not necessarily support the decision. To determine an equitable outcome, we would ask the insurer to demonstrate prejudice as a result of the failure to be in possession of a valid licence.”
SAIA said that “in essence the insurer would need to prove if possession of a valid licence was material and is directly relevant to the claim”. In such situation, a claim might be rejected.
“Therefore, we believe the motor claims that happen during the broken driving licence card machine would be treated in the same way as the ones mentioned above. However, we urge policyholders affected by this delay to proactively contact their broker and insurer and inform them about their predicament.”
Motorists who want to avoid potential insurance issues that result from not having a valid driving licence card can apply for a temporary driving licence at a Driving Licence Test Centre. A temporary driving licence is valid for six months.
In terms of a notice published by Mbalula in the Government Gazette on 31 August last year, all learner’s licences, driving licence cards, temporary driving licences and professional driving permits that expired from 26 March 2020 to 31 August 2021 were deemed to be valid and their validity periods were extended to 31 March 2022.
The notice was published in terms of the Disaster Management Act, to extend the grace period for licences that expired but could not be renewed timeously because of the lockdown.