The Ombudsman is not one person, but an independent office of well qualified people employed to assist the consumer and insurer in the event of a conflict arising from an insurance claim! Established in August 1989, The Office of the Ombudsman for Short-Term Insurance provides consumers with a free, efficient and fair dispute resolution mechanism. It offers consumers with a “no risk” mechanism to resolve disputes with insurers.
The Ombudsman’s Office is governed by a Board of Directors, comprising of four consumer representatives, three insurer representatives, one representative from the South African Insurance Association (a trade association, which represents all short-term insurance companies in South Africa) and one representative from the Financial Services Board.
The current Chairman is Moses Moeletsi and the Deputy Chairman is Gail Walters.
The Office can assist consumers with the following personal lines short-term insurance:
- Houseowners (Buildings)
- Householders (Contents)
- Cell phone
- Credit protection insurance
Commercial Insurance on a Limited basis, i.e. claimants such as small businesses, including a sole proprietor or trader, a juristic person, partnership or trust that has a turnover in the last financial year of less than R8 million. Claim disputes, which the Office can assist with, include fire and allied perils (if there is an involvement of loss of profits/interruption, the entire claim will not be dealt with by the Ombudsman’s Office), glass, theft, motor, travel, sickness and accident and SASRIA claims (affiliated to the aforesaid covers).
But will the insurer listen to the decision by the Ombudsman?
The Office of the Ombudsman for Short-Term Insurance has been granted recognition in terms of the provisions of the Financial Services Ombud Schemes Act. All personal lines short-term insurers have agreed to abide by the Ombudsman’s decision.
The Ombudsman’s task is to act as a “mediator” or informal arbitrator and he/she does not represent either of the parties to the dispute.
The consumer needs to be aware of the following aspects:
- The consumer must complain to his /her insurance company first and only if unable to resolve the dispute with your insurer, then he/she can refer the matter to the Ombudsman’s Office
- The Ombudsman’s decisions are binding on the insurance company but not on the consumer – it does not take away the other legal remedies available to the consumer.
- The Ombudsman’s Office is an independent office
- The Ombudsman’s decisions can be based on either law or equity The Ombudsman’s Office does not give legal advice
- The service is free to insured consumers
On the Car Insurance and Road Safety Blog we will provide commentary on some of the decisions by the Ombudsman and the lessons learn from these decisions.