The case brought forward by the insurer was granted in favour of the insured, who damaged his vehicle by negotiating a freeway offramp at too high a speed in wet weather. The insurer sought to repudiate the claim based on a standard insurance policy clause that stipulated that 'the insured and/or any person enjoying cover under any section of the policy must exercise all reasonable precaution to maintain safety of the property and to prevent loss, damage and accident.'
'Negligence, though,' states Carandhomeinsurance.co.za, 'refers to the upkeep of the vehicle. If the tyres were worn and the accident was caused as a result of the car being in an unroadworthy condition, then the insurer can repudiate the claim.' According to the Ombudsman, the clause for 'reasonable precautions to maintain the safety of the vehicle', does not refer to reckless driving. The insurer's interpretation of the clause frustrates one of the major purposes of insurance cover: to protect the insured from his own negligence.
What constitutes negligence?
While an insurance policy does afford the policyholder a measure of protection against him- or herself, there is a difference between negligence caused as a result of driving style and that caused as a result of poor maintenance of the vehicle. 'If insurers could claim negligent driving as a reason to repudiate a claim, then your age and gender would not factor into your risk analysis. Insurers may as well reject any claim made by men under the age of 25 because of negligence, instead of making them pay a higher premium for being a higher risk group.'
Negligence refers to the failure to carry out a reasonable degree of care for the property so as not to endanger others or their property. 'Reasonable' refers to what a 'reasonable' person would have done in similar circumstances. This forms the basis of liability insurance, such as third-party car insurance, which is, in essence, insurance against your own negligence.
'Not taking care to protect others and their property, which results in loss, makes you personally liable to the damaged party,' says spokesperson of Carandhomeinsurance.co.za. 'Not having third-party insurance could be financially crippling, as could not having sufficient third-party insurance.' As a result, the South African Insurance Association are in the process of proposing compulsory third-party car insurance to the Department of Transport.
Unlike the United States and UK, South Africa does not make car insurance compulsory, which has led to an unsustainable motor insurance industry, not to mention many an over-indebted consumer. Such compulsory third-party insurance would do much to alleviate the strain on car insurance companies who cannot reclaim damages from guilty third-parties.
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