Why insurers are rejecting thousands in claims

Thousands of South African motorists are driving vehicles that fail basic roadworthiness standards – and when accidents happen, they're discovering their insurance won't cover them.

The National Financial Ombud Scheme (NFO) has warned that insurers are increasingly denying claims or limiting payouts when poor vehicle maintenance contributes to incidents.

With more than 10,000 people already dead on South African roads in 2024, according to Transport Minister Barbara Creecy, and many of these fatalities linked to vehicle defects, the stakes are high.

Worn tyres and faulty brakes top the list of reasons insurers cite when rejecting claims on grounds of unroadworthiness.

"Most policies explicitly state that claims may be denied if the insured fails to comply with the [National Road Traffic] Act and the vehicle is not roadworthy at the time of the incident," says Edite Teixeira-Mckinon, Lead Ombud of the Non-life Insurance Division of the NFO.

The National Road Traffic Act prohibits operating a motor vehicle with tyres where the tread is level with the tyre tread depth indicator. Insurers are using expert evidence to prove non-compliance and reject claims worth thousands of rand.

When the rubber meets the road

Teixeira-Mckinon cites a case where a driver lost control after hitting a puddle and crashed into the pavement.

The insurer's expert found the left rear tyre was unroadworthy – its two inner tread wear indicators were level with the remaining tread pattern.

The expert concluded the worn tyre couldn't disperse water channelled by the front tyres, causing it to aquaplane.

The right rear tyre followed, and the driver lost control. The NFO upheld the insurer's decision to reject the claim, finding the unroadworthy tyre was the direct cause of the accident.

But proving unroadworthiness alone isn't sufficient. The NFO requires insurers to demonstrate that the defect was material to the occurrence of the accident.

In another case, an insurer rejected a claim because brake shoes and a rear brake disc were worn. The driver had swerved to avoid a pothole, causing his vehicle to tip over.

The NFO overturned the rejection – the insurer hadn't proven the brakes were applied during the incident, so there was no causal link between the worn brakes and the accident.

The insurer settled the claim.

The real cost

Beyond rejected claims, drivers of unroadworthy vehicles face liability for damage to other vehicles and property. With South African roads claiming approximately 14,000 lives annually, vehicle maintenance is both a legal requirement and a contractual obligation for insured motorists.

"By not maintaining your vehicle's roadworthiness, you run the risk of not only compromising your insurance cover in the event of a claim and possibly having to pay for your own vehicle's repairs but also having to pay for any damage you cause to another motor vehicle and property," Teixeira-Mckinon warns.

The NFO advises motorists to follow the manufacturer's recommended maintenance intervals and conduct regular checks on key vehicle components, particularly the tyres and brakes.

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