Car Insurance Guidelines for South Africans
August 21, 2016
Car insurance guidelines are essential because car insurance is something that people pay at some time or another.
In South Africa, the most important of these laws is the Short-Term Insurance Act. Parliament amended the Ac in 1998.
Car insurance guidelines can be complicated, and the government legislates the parameters.
The Financial Services Board is responsible for ensuring insurance companies follow the regulations set out by law.
Car Insurance Guidelines
- Short Term Insurance Act 53 of 1998 – Insurance companies must be solvent.
- Policy Holder Protection Rules 2004 – Protects the vehicle owners and ensures companies adhere strictly to sound insurance practices Furthermore, the common interest of all concerned parties must show a bias towards the public.
- Financial Advisory and Intermediary Services Act 37 of 2002 –Deals with the regulating of any intermediaries and advisers.
- Financial Services Ombud Schemes Act 37 – This lays out a policy by which the insurance companies must administer the laws.
An insurance company must issue the insured with a written policy and an explanation of the terms. The company must also inform them of any complaints and how they will resolve them.
These regulations give importance to the need for insurance but protect vehicle owners from falling victim to unfair practices.
The ombudsman and regulations should be fair mediation between the vehicle owner and insurance company when it comes to claims.
The ombudsmen can, therefore, determine whether a claim gets paid or not. This ruling takes away the final decision from the financial institution, thus ensuring fairness to all.
This legislation is unique to South Africa. However, most countries have similar laws.
Search the internet for the relevant legislation governing car insurance. Don’t get a nasty surprise.
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All info was correct at time of publishing