MOTOR INSURANCE RULES

[Phil Cooper]

1. Around 65% of cars on SA roads are UNINSURED totally. So do NOT think, because you are a good driver, you need not insure, as "the other driver will pay when they are at fault".

2. NEVER drive an uninsured car. If it is an "old knocker" worth NOTHING, carry at LEAST Third Party cover - at most +- R700 a year premium.

3. If you are insured, and you have a TINY ding with another vehicle, with NO visible damage to EITHER vehicle, PUT IN A CLAIM "FOR ADVICE PURPOSES ONLY" with your insurer. This is an unbreakable rule.

4. If you decide NOT to put in a "for advice purposes only" claim, re-read rule 3. Then do it. Without fail.

5. If you are insured, and you are hit by a Third Party who says you should claim from their Insurer: do NOT. NEVER EVER. Claim from YOUR insurer, and then let THEM recover your loss.

6. 3. and 5. are unbreakable rules. And I do NOT say that lightly!

[Dave A]

A classic case in point starts right here.

[Blurock]

Phil, can you explain point 3 in more detail?

[msmoorad]

since this thread seems to be getting more attention than the other one
let me ask:
can an insurance company write off your vehicle if one of their clients has knocked into you but you are NOT insured/covered by them?
or do they have to pay for repairs to your vehicle-whatever the cost?

[Phil Cooper]

BLUROCK

You have 30 days in which to report a claim to your insurer. After that, they can decline it.

The number of times over the last decade I have clients who have a "tiny" accident, they say there is no visible damage - and around 9 months later they get a letter of demand from the other party's Insurer for the damage they caused (average these days around R17,800) to their client's car. If you don't pay they will take legal action against you.

Your insurers are not interested - you are outside the 30 days. So it is you vs "big money". And you can say WHAT YOU LIKE - there was no damage - it is your word against their client.

If you HAD put in the "record purposes" claim, you send the letter to your Insurers, and they will fight it out on your behalf.

msmoorad

If you can afford to fix your car, and do it, you can claim against them for the repairs.

BUT - if you get them to assess it, and they say it is a write off, they will offer you "cash in lieu" of the value of the vehicle for the value - and that leaves you high and dry.

[Dave S]

I have a question here, Just to give the scenario. You're involved in an accident and it's your fault, you're uninsured. The other party's insurance claims their damages from you.

1. Can the other party's insurance claim the full amount of the damage? I ask this as their client has obviously paid premiums that will cover the cost?
2. Can you offer to pay only the excess that their client would have to pay? This means they are not out of pocket when refunding their client?

This is just something that has always puzzled me.

[Phil Cooper]

Hi Dave

The Insurer WILL claim the full amount of the damage. Legally, you are responsible for it.

You can offer - but they won't accept it Legally, you are resonsible for 100% of the damage, and NOT just the excess.

[Dave S]

Hi Dave

The Insurer WILL claim the full amount of the damage. Legally, you are responsible for it.

You can offer - but they won't accept it Legally, you are resonsible for 100% of the damage, and NOT just the excess.

Yes that was my take on it also, I asked the question as, when I was a young fella, I had an accident. I was uninsured, and the other guys insured suid me for R1300.00 (it was cheap to fix a car back then). I was still an apprentice and earning only R9.50/week, so I pleaded with the insurance company and they told me I could then pay his excess, which was R120.00. Like I said, tings was cheap back den...

[CLIVE-TRIANGLE]

Yes that was my take on it also, I asked the question as, when I was a young fella, I had an accident. I was uninsured, and the other guys insured suid me for R1300.00 (it was cheap to fix a car back then). I was still an apprentice and earning only R9.50/week, so I pleaded with the insurance company and they told me I could then pay his excess, which was R120.00. Like I said, tings was cheap back den...

This practise has a long history. Prior to 1976 (if my ailing memory serves me), the courts were chocked with insurance companies suing insurance companies. Invariably courts would award 60/40. Obvious-blame issues naturally did not go to court. Insurance companies soon worked out that they were merely increasing the costs with all of the legal fees and round about that time they signed a knock-for-knock agreement.

The essence of the agreement was that each company would pay their clients' own damages and only "ask" each other for their clients' excess if:
- the client inquired
- and there was patent and clear major fault by the other party

Naturally this brought about conflict when both parties were with the same insurer or when one party had no cover. In the case of the latter, the insurer will attempt to recover the full damages from the other party, because being uninsured, he was never party to the knock-for-knock agreement. If the uninsured digs his heels in they will frequently settle for the excess, because that is most likely all that the courts will award.

[msmoorad]

and what if the guilty & uninsured person in unemployed?
will they write it off after investigating to confirm you really are unable to pay?