Posted: 2008-11-06 23:57 Business & Insurance  Presenter: Heather D’Alton Guest(s): Lourens Joubert Summit TV speaks to Lourens Joubert from corporate and commercial underwriting at Santam about changes to the Road Accident Fund that mean you may need more of your own insurance Heather D’Alton: Welcome to Business & Insurance. The Road Accident Fund (RAF) has seen a major revamp in recent months that if you were in an accident at any time after 1 August 2008 you’re now subject to a whole new set of rules when claiming. What’s changed and why? Lourens Joubert is the head of corporate and commercial underwriting at Santam. Lourens, thanks very much for joining us - let’s start off by looking at the changes that the Road Accident Fund has seen since 1 August 2008 promulgated by Transport Minister Jeff Radebe - what has changed? Lourens Joubert: Two big things - one is that the fund limits compensation to the individual, the second is that the RAF removed the individual’s common law right to claim against the guilty party in a vehicle accident. Heather D’Alton: R160 000 is the upper limit - you can’t if you were driving or were a passenger in an accident request more than that from the Road Accident Fund? Lourens Joubert: Yes, that’s one of the limitations. If you’re injured and you can’t do your normal job any more you can only claim compensation for loss of income up to R160,000 per annum - and that’s irrespective of how many dependants you have. Heather D’Alton: Why have they introduced this? Is it something to do with the financial state of the Road Accident Fund? Lourens Joubert: Yes, that is one of the reasons. There has been a lot of publicity around the fact that they’re running out of funds - in the past compensation was virtually unlimited, and there was the example of a Swiss tourist who claimed up to R500million from the fund. That’s why they want to limit their exposure… Heather D’Alton: How much abuse was there of the Road Accident Fund in your view? Lourens Joubert: There were allegations of a lot of costs going into the recovery process and attorney’s fees but it’s difficult to say… Heather D’Alton: One of the main changes you mention is the fact that if I was in an accident I don’t have the right to sue the guilty party any more - can you give some more detail on this? Lourens Joubert: The main thing is you will have to look at what income you would need if you were injured or disabled in an accident to carry on with your normal living standards - so it’s up to the individual now to make sure they have enough insurance and medical aid cover to compensate them. Heather D’Alton: With regards to this specific change in the law it’s early days yet - do you perhaps foresee this still going to the Constitutional Court and potentially changing? Lourens Joubert: It is possible. It’s quite a big step to say that your common law right is removed to claim against the guilty party - so that could be tested. In 1994 the COIDA Act was changed that regulated the liability between employer and employee - and that was challenged in the Constitutional Court. That was upheld by the court - however that is a closer relationship than in a vehicle accident where you have a third party that doesn’t have a close relationship with you. Heather D’Alton: One of the major changes also is that disablement, disfigurement, loss of income as you mentioned - these are completely excluded now from the Road Accident Fund… Lourens Joubert: Damages are excluded - unless it’s classified as serious by a medical practitioner. Indications are that your disablement would have to be more than 30% if you want to succeed with a claim against the RAF. But you can take an example of a surgeon who loses a finger in an accident and can’t operate any more - that might not be seen as a serious injury… Heather D’Alton: Again your advice being don’t rely on the Road Accident Fund any more? Lourens Joubert: Yes, make sure you’ve got enough insurance cover and loss of income cover… Heather D’Alton: The main forms of insurance you’d be looking for there? Lourens Joubert: There are different options available - the life insurance industry and the short term insurance industry. The cheaper insurances will be personal accident type of covers that are limited to accidents. If you go to life insurance there’s more disease cover so that’s more expensive. It depends on what your needs are. www.summit.co.za Transcripts: 082 962 2772 mvr/met Comments Related to this transcript: Comment on this transcript... Name : Email : Comments :