FACT FILE
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THE OMBUDSMAN FOR SHORT-TERM INSURANCE
THE Ombudsman for Short-Term Insurance is Judge Ron McLaren. According to its website (www.osti. co.za), the office of the ombudsman is wholly independent and does not answer to insurers, consumer bodies or the regulator (the Financial Sector Conduct Authority). Its mission is to resolve short-term insurance complaints fairly, efficiently and impartially. The ombudsman resolves disputes between consumers and short-term insurers: ● As transparently as possible, taking into account our obligations of confidentiality and privacy; ● With minimum formality and technicality; and ● In a cooperative, efficient and fair manner. COMPLAINTS In the latest annual report, for 2019, of the complaints received: ● 49% were for motor vehicle claims; ● 20.1% were for homeowners (building cover) claims; ● 7.9% were for commercial insurance claims; and ● 6% were for home contents claims. Of the 8 578 complaints finalised in 2019, 1 573 (18.3%) were resolved with some benefit to the consumer. REASONS FOR CLAIM DISPUTES Christelle Colman, insurance expert at Old Mutual, says the report shows that the consistent drivers of insurance failure remain as follows: 1. Under-insurance Failing to insure household contents at their current and correct replacement value.
2. Poor maintenance lnsurance policies only cover damage caused by unforeseen events; home maintenance is the responsibility of the homeowner. 3. Alarms not working Homeowners should ensure that alarms work at all times. It is the policyholder’s responsibility to keep the home security system operational. 4. Driving violation A motorist driving under the influence of alcohol or narcotics or without a valid driver’s licence is committing a criminal offence. Criminal acts automatically invalidate insurance cover. This may also include reckless or negligent driving and speeding. 5. Unroadworthy vehicles Cracked windscreens, worn wiper blades or tyre treads below the legal limit of 1.6mm are common reasons for accidents and claims repudiation. 6. Safe overnight parking Insurers have different requirements on what constitutes secure overnight parking. Off-street parking is
acceptable to some, while others may insist that the vehicle be kept behind a locked door or gate. 7. Unnamed drivers If a motor insurance policy provides cover for named drivers only, claims will be rejected if another, unnamed, driver was behind the wheel at the time of the accident. Another common practice is parents listing themselves as the regular drivers of their children’s vehicles in order to secure a lower premium. WHAT TO DO IF YOU HAVE A COMPLAINT? Before contacting the ombudsman’s office, complain to your insurance company first. It is best to complain in writing. Make sure that you keep copies of all correspondence between you and your insurer. If you are not happy with your insurer’s response, you can complete the complaint form and send it back to us either by post, fax or email. You can also lodge a complaint online. For the Ombudsman’s contact details, see page 20.
