This was published by the City Press?
"Broker claims car was unroadworthy
2010-12-19 13:00Nhlanhla Ncaca
Hi Performance Brokers repudiated Lebogang Lerumo’s insurance claim on the basis that his car had never been roadworthy.This is despite accepting regular premium payments from Lerumo.
A distraught Lerumo contacted Hotline following a battle that lasted two months over the settlement.
He took out insurance cover when he bought his Opel Astra Classic 1.6 sedan 2006 model and made regular payments.
In September, he was involved in an accident. When he submitted the insurance claim, he was told the car was never roadworthy.
“I do not understand the games some people play. These people accepted payments and never mentioned anything about the condition of the car.
“Now they are coming up with excuses not to pay me,” said Lerumo.
He admitted that he was responsible for the accident, which took place on the busy Chris Hani highway in Soweto.
The traffic was moving at a very slow pace and when his breaks failed, Lerumo’s car bumped into the back of the car driving in front of him. The other car was slightly dented, and parts of the bumper and front of Lerumo’s car were damaged. He contacted Hi Performance Brokers and the insurers arranged for the car to be towed to a repair centre.
Three weeks later, the insurance company repudiated Lerumo’s claim. He was left to settle the bill of R6?042 in towing and storage costs. A wrangle between the parties ensued.
Hotline referred the complainant to Tandy De Witt, a senior consultant at High Performance Brokers. She agreed to review the case.
On December 1, De Witt invited Hotline to the company’s offices for a personal briefing. She claimed the matter had been resolved. However, she failed to confirm a time for the meeting. Hotline suggested that she instead send a written response. She has since been making empty promises to provide Hotline with feedback.
» The Ombudsman for Short-Term Insurance, Brian Martin, says exorbitant towing, recovery and storage fees can be avoided if a policyholder knows his or her rights.
It is important to understand the terms and conditions of the contract, and what action needs to be taken at the scene of an accident.
» Related complaints can be referred to the Ombudsman for Short-Term Insurance. 0 011 726 8900 or visit
www.osti.co.za"
http://www.citypress.co.za/Columnists/Broker-claims-car-was-unroadworthy-20101218
Now we don't have to love insurance companies to at least be constructive and independent in our views.... and in this case to be fair when reporting on matters like this. I am saying this because of the total rubbish in terms of fact, research and understanding of the topic reported on by this reporter.
Press Freedom?
I suppose that opens the debate for or against Press Freedom (a hotly debated topic at the moment);
for instance, "JOHANNESBURG - President Jacob Zuma’s latest action against the media, is the 14th defamation suit he has filed in the last four years, a legal expert said yesterday."
http://www.citizen.co.za/citizen/content/en/citizen/local-news?oid=159484&sn=Detail&pid=334&Zuma%E2%80%99s-14th-case-against-media-
Now i don't particularly like the man, but hell he has attorneys who advises him ... can he be wrong in all 14 cases? Does press freedom means that The Press can just write anything about anyone without having some or any responsibility regarding the truth of the matter being reported on, or whether there is any basis to the story published, without any verification of truth of the content? Does this type of reporting not fuel the support against "Carte Blanche Press Freedom". Does this mean that any fool with a pen could write anything about anybody? I hope not.
Report facts!
To get back to this piece, which intimated the unfair treatment by High Performance of a clients claim.
First of all, High Performance is a Broker, not an Insurer. I presume the Broker of this client, Lerumo (the Insured).
Second of all, A Broker may not reject or repudiate a claim on behalf of an Insurer. So High Performance could not repudiate?
Only a licenced Insurer may do so,
and only in writing,
and the reasons of such a repudiation must be stated so clearly - Refer Policy Holder Protection Rules (and or Short Term Insurance Act).
The Broker has a legal duty to communicate with his client (to provide advice and financial services - that is why a Broker is entitled to earn commission). In this case, I suppose the Broker was just the bearer of the bad news (passing on the rejection notice which was received from Hotline). Incidentally, Hotline administers claims on behalf of the Telsure Group (Companies like Auto and General etc).
Third of all, Paying your premium does not mean that every claim registered will be met. That is only part of various performance clauses in any Short Term Insurance contract. Over and above that, the client and the Insurer has various other contractual obligations that must be met. In this instance, the original and proximate cause of the accident was that the "breaks failed". It was apparently established by the Insurer that the vehicle was not roadworthy. Besides most policies having conditions requiring you to maintain your vehicle, sometimes in accordance with the required Road Ordinance Act, you also have an utmost duty to prevent loss or damage. In short layman's terms, you must act responsible! If it was established by the insurer that the vehicle was not roadworthy, then the Road Traffic Act prohibits the client of driving this vehicle on any public road. The fact is, this client was breaking the law in doing so.
Most contracts can not be asked to respond, if any part of it is against the law (that is contract law). If the vehicle is not properly maintained (and the breaks not serviced and maintained) it is also then a certainty that the breaks will fail at some point and then the probability of causing damage to the vehicle itself or third party property, is almost guaranteed, it is almost a certainty. Short term insurance policies is there to cover clients against the Unforeseen or Unexpected event, not against certain loss or damage.
Short Term Insurance Ombudsman
Maybe this is best explained in a recent case at the Ombudsman's office;
"Another lesson to be learnt from the ombudsman’s report is that you must keep your vehicle in a roadworthy condition or you will not be covered if you have an accident.
In a case that came before the ombudsman, a man’s car was damaged after he swerved to avoid, but ultimately hit, a drunk pedestrian. However, the tread on both rear tyres on his car were below the legal limit.
Most vehicle insurance policies, including that of the man in this case, stipulate that your vehicle must be roadworthy. As the tyres were worn, the man’s car was not roadworthy and his claim was repudiated.
The ombudsman was unable to help him because the condition of the vehicle was material to the claim. Although the worn tyres were not the cause of the accident, the accident may have been avoided or the damage less severe if the tyres on the man’s car were not worn, Van Zijl says."
Why is this case any different? Why did the reporter not researched the topic first? Did the reporter ask High Performance (The Broker) or the Insurer for them to reply to the allegations? Did the failure of the client on maintaining his vehicle contributed to the accident? What if the client killed someone as aresult of the his vehicle not being roadworthy?
Happy New Year 2011.
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