Road Accident Fund Reform Assessed

Tourist operators' passengers affected With a reduction in the amount passengers can claim after an accident, it is advisable that they acquire their own road accident cover.

The Deputy Business Unit Manager at Alexander Forbes Risk Services, has assessed the reforms in the South African Road Accident Fund and shown how the 'good' and the 'bad' changes affect both sides in an accident, especially in the tourism industry.

Mark Bush took the example of a road accident involving a tour operator carrying passengers and showed how the reforms in the Road Accident Fund were bad for these passengers.

Under the new laws, passengers are only allowed to claim loss of income of up to R160,000 a year. In addition, loss of support claims are limited to the same amount.

The reforms also indicate that public health tariffs will dictate medical expense payouts, and only what is categorized as 'serious injury' will be liable for claims such as pain and suffering, loss of amenities of life, and so forth.

"The amendments of the Act significantly reduce a passenger's claim against the Road Accident Fund following a motor accident," said Bush.

Bush urged all those driving in South Africa - both foreign and locals - to take out sufficient road accident insurance as the coverage offered by the Road Accident Fund was not sufficient.

While the above certainly spells out bad news for the passenger, Bush showed the flip side of the reforms, especially the fact that passenger liability cover would decrease in the future because the Road Accident Fund reforms removes the passenger's rights to claim compensation by the driver of the vehicle.

"This restriction goes to the heart of the risk faced by vehicle owners and operators of game drive vehicles, tour busses, passenger transfer vehicles, etc," he said.