Only approximately 30% of the cars on South African roads are insured. This is irresponsible and can be compared to playing roulette and betting on a colour – only problem being there is not an equal distribution and the chances are far less than 50% of making the right decision!!
Motorists often shrug off these risks –until disaster strikes and they are presented with a letter from the lawyer of the car they bumped into. We would like to share correspondence between the Car Insurance Blog and one such person:
“Hi, I caused an accident in Feb this year, I don’t have insurance, but the guy that I hit, was driving his company vehicle. They have insurance, when they phoned me 1 week after the accident, they asked if I can pay the damages of R51 000 so I said I won’t be able to afford it, they then asked telephonically if I can pay the excess amount and I said yes but only if they will allow me to pay off, because I don’t have all the cash. Yesterday I received a letter of demand from the insurance company’s lawyer and they want me to pay R51 000. I need help, what do I do? I don’t want it against my name, I don’t want a bad name, but I don’t have money.”
This is a classic case of the claims cost recovery process in action. The guilty person (i.e. the one who caused the accident) is responsible for the footing the bill for the entire costs of the damage and not only the excess portion of the costs. The insurance company (or its attorney) sends a letter of demand for the costs for which the guilty person is liable. It’s crucial that the person responds and makes some sort of settlement offer otherwise the process goes further where a summons is issued and judgement can be taken. This means that the person’s goods can be attached in order to offset the amount owing.
It’s also crucial to understand whether the guilty party is fully liable (or liable in part) for causing the accident. In many instances there is contributory negligence on both parties (e.g. where 2 people are reversing out of their respective parking bays and they then collide.) The best way to determine this and to be better infirmed is to contact a lawyer to assist in the matter. There are obviously costs involved.
“Thank you so much.
I just need to know if I am liable for the damage in front of the vehicle as well? I hit the client from the back driving about 30-40km and he hit another vehicle in front. Am I liable for all the damage on the vehicle?”
Yes, you would be liable for the damage caused to any cars or property that was damaged in the chain of events. It’s vital to confirm exactly what happened though. E.g. if the car in front of you suddenly braked to avoid crashing into the car in front, and you were also forced to brake but could not avoid the collision, the defence is stronger and will limit your liability. You could the plead that you acted defensively but not avoid the collision. In such a case, there would contributory negligence and you would not be solely responsible.
• You should consult a lawyer for advice. The cost may be worth the effort.
• You should get some basic insurance in place. We have a basic product which covers “liability to other parties” which would have helped her in this instance. It’s dangerous to be without any insurance these days.
Conclusion and Advice
The risks are simply too big – and it is irresponsible to allow yourself without any cover against accidents. Even if you struggle to afford comprehensive insurance – take out third party insurance and protect yourself from the claims from others!
[A word of appreciation to Trevor Devitt from Outsurance for assistance with the answers]