South African roads are amongst the most dangerous globally. According to Christelle Colman, spokesperson for Old Mutual Insure, accidents with uninsured drivers add to the financial burden of those who are responsible and do pay for car insurance.
“Of the 12 million-odd cars on our roads, approximately only one third are insured. This means that you have an almost 70% chance that, if you are in an accident, it will be with an uninsured driver,” says Colman. “The high percentage of motorists without any form of motor insurance means that the minority who do insure their vehicles are being forced to subsidise others through higher premiums.”
“We need to increase the number of insured drivers on our roads because ultimately, this will translate into a reduction in the cost of motor insurance.”
She suggests two possible options.
“We need car insurance to be mandatory for every car owner before the driver signs on the dotted line to purchase their car. This is standard practice the world over. Our view is that if you can’t afford insurance, you shouldn’t be driving a car because this means that you cannot adequately protect your or someone else’s asset in the event of an accident,” says Colman, adding that in South Africa, the risk is very high that something can go wrong when you are on the road.
Colman is also calling for legislation on compulsory third-party vehicle insurance to be re-introduced in South Africa, the idea of which was mooted by Finance Minister Tito Mboweni during his 2020 Budget Speech.
Compulsory third-party insurance was enforced in South Africa from 1942 until 1997, which covered bodily injury and damage to motor vehicles before it was replaced with the Road Accident Fund (RAF). “Whilst the RAF has provided financial aid for death and bodily injuries sustained in motor vehicle accidents, the cost of the damage to the vehicles is usually left to the consumer and the insurer.”
Colman says that while it may be some time before compulsory third-party vehicle insurance is reinstated, consumers should understand the ins and outs of their policy. If you are in an accident caused by another uninsured individual, your insurer will usually action third party recovery on your behalf if you are the policyholder.
“Until such time that compulsory third-party insurance is introduced again, all motorists are encouraged to take out a proper insurance policy, even if it is only third-party cover. This is a cost-effective option that will, at the very least, ensure that you are covered if there is financial recovery against you for causing an accident,” concludes Colman.
Click here to read the Old Mutual Insure media release that also includes steps to increase the insured’s chances of recouping the costs of the accident – good discussion points with your clients.