There is some important car insurance law in South Africa that all vehicle owners in this country should be aware of.
Car insurance is simply a contract. The insurance company assumes financial responsibility for losses the car owner suffers because of theft or damage.
You’ve got to read your policy and understand the exclusion clauses. Be careful how you fill in your insurance policy because wrong information will lead to you not being paid out for damages.
Some of the Laws in the Regulatory Framework that Govern Car Insurance are:
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• Financial Advisory Intermediary Services Act (Act 37 of 2002)
• Short-term Insurance Act (Act 53 of 1998 as amended)
• Policy Holder Protection Rules (Short-term Insurance of 2004)
The insurance sector is regulated by the Financial Services Board regarding legislation and regulations that are promulgated by the SA parliament. Consumers need to know this because these laws impact on the rights of car owners as well as financial service providers, consumers and others.
Get to Know Your Rights as a Car Owner and Your Relationship with Your Insurance Company
- First, the Financial Services Ombudsman Scheme is one that creates a mechanism for the statutory recognition of voluntary schemes. It also determines minimum standards that are required for recognition. It is an independent controlling body receiving complaints from clients with regards to financial institutions and deals with them in a fair and economical manner.
- Second, the Financial Advisory and Intermediary Services Act 37 of 2002 is there to provide financial advice as well as intermediary services to its clients. It deals with the regulation of brokers. It deals with explaining the role of the Ombudsman and its formulation. It will also deal with the codes of conduct for financial service providers and determines fit and proper requirements. The laws of the FAIS protect consumers from financial advice being given inappropriately, allowing consumers to take action when given bad advice. Rules of the FAIS need to be adhered to and there will be disciplinary procedures when not adhered to.
- Third, the Short Term Insurance Act 53 of 1998 deals with amongst other things, provides registration to short-term insurers. It controls and administers short-term insurers as well as intermediaries. It prescribes financial requirements, regulating policies and commissions, etc.
- Fourth, the Policyholder Protection Rules 2004 was issued in 2001 and is separate from the conduct for financial advisers. They ensure that policies are entered into and executed according to sound insurance principles and practices. Short-term Insurance Policyholder Protection Rules relate to short-term policies like motor vehicle or household policies, etc.
Car Insurance Law Discussed on Car Insurance Blog
There is a Car Insurance Blog, and here they strive to help aid vehicle owners. This includes insurers, financial advisors and industry bodies. This blog creates awareness around car insurance law and how important it is to be insured for safety on the road.
Other important issues you will find on this blog are:
• car insurance legislation
• legal aspects when providing advice on car insurance
• protection for consumers who own vehicles and car insurance policy holders
• fraud and criminal law
• car claim/disputes
• the role of the Ombudsman
• decisions and discussions around short term insurance from the Ombudsman
Check out the Car Insurance Blog – it is easy to understand car insurance law especially aspects that relate to car insurance policy holders.
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