How long does an insurance company have to investigate a claim in South Africa?

Cape Town - As a motorist, you’re probably paying vehicle insurance premiums every month; in part, because the bank forces you in your loan t’s-and-c’s and to be covered against the dangers on our roads.

With road crashes and car theft on the rise in South Africa, you want to make sure that there are measures in place to help you should you fall victim. 

Unfortunately, just because you have a policy in place, doesn’t necessarily mean that you will get a payout when you submit a claim. Year after year, thousands of South African motorists have insurance claims that either partially or entirely rejected.

LawForAll lists some of the reasons why your claim could be rejected, and how, says, “the law is on your side should you feel as though you are treated unjustly by the Insurers”.  

6 reasons why your car insurance claim could be rejected: Info by LawForAll

1. You have unpaid premiums  
If you neglect to pay your premiums regularly (and on time) the insurance company will cancel your policy and you will be left without cover. 

2. An unlicensed or unspecified driver is behind the wheel. 
Usually, policies only cover the owner or regular driver of the vehicle. Moreover, if an unlicensed driver is driving your car and is involved in an accident, your claim will be rejected. 

3. Your vehicle is not roadworthy. 
A mechanical issue such as your indicators not working could result in your claim being denied if you’re in a crash. So be sure to have your car checked regularly.

4. You were driving recklessly. 
It’s is very common for insurance policies to include Failure to Take and Breach of Road Traffic Regulations clauses. The former means your insurer has the right to dismiss your claim if you were a hazard on the road, while the latter indicates that if you were breaking a road rule that resulted in an accident, i.e you were speeding or driving under the influence, you wouldn't get any compensation from the insurance company.

5. Write-off cover is not included in your policy. 
If this isn’t specified in your agreement, you won’t be entitled to claim if you write your car off. 

6. Alarms, general security measures and tracking devices not fitted. 

Most insurance companies only pay out if you have these preventive devices installed in your vehicle. Also, if you have stated that your car is parked in a secure space at night, but it comes to light that you in fact park on the street, for example, you won’t receive a payout should it be stolen or broken into.

Has a vehicle insurer rejected your claim? Email us and share your story.

                                                                                                                                Image: iStock

What if my claim was unfairly rejected? 

If you believe you’ve taken all the necessary precautions and your claim is still rejected, you can approach the Ombudsman for Short Term Insurance (OSTI) for assistance but there are certain steps you should follow before doing so.  

Advocate Jackie Nagtegaal, LawForAll’s Managing Director, says: “The insurance industry is incredibly regulated to ensure that the rights of consumers are protected. However, despite lengthy terms and conditions, there are mechanisms in place for consumers to state their case should they feel as though the insurance companies aren’t sticking to their promises.” 

Nagtegaal advises to take the following steps before approaching OSTI:

1. Be sure to raise your complaint with your insurer first. It’s best to do this in writing so that you have a clear record of all the facts leading up to this point. 
2. While it may be difficult to control your emotions, try to remain calm and friendly. It will help you communicate effectively.
3. Try to take up the issue with one of the insurance company’s Senior Officials.  
4. Keep track of all communication and facts, and make copies of any correspondence. 

If your claim is still rejected after going through all the above-mentioned, you can send your complaint to the Ombudsman. The Ombudsman functions as an impartial mediator or arbitrator without representing either the consumer or the insurance companies in South Africa.

 Nagtegaal warns: "No matter what you do, always keep in mind applicable time frames mentioned in your policy. You usually only have six months after your claim has been repudiated to take the company to court and institute a civil claim. If you don't, your claim will lapse."

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