Many people wonder if they should or shouldn’t take out insurance in South Africa. It’s a good thought to have and process, and as top brokers in Durban, we believe, along with some others, that one should only take out insurance if you can’t afford to carry the cost of the accident yourself and if you’re buying insurance through an authorised, honest broker. Others want facts. They want to know what are the most reported claims, what are the most reported disputes to the ombudsman and so on. These facts and statistic are important to consider when thinking about what type of insurance coverage one needs and learning where they can be most at risk. However, to make a good and informed decision, it’s important to have a needs analysis with an honest broker. Brokers advise and guide you through the claims process during a catastrophe or a time of loss. There are many other benefits of a broker, but for those who don’t have a broker, it can be difficult to claim at times. That’s when complaints are made with an ombudsman.
So what sort of claims aren’t being paid out by insurance companies? Below is a chart showing the types of claim case complaints referred to an ombudsman.
Deanne Woods presented the Ombudsman for Short-Term Insurance’s (OSTI’s) annual report. The report showed that 4,991 of all 14,916 claims submitted to her office in 2016 were motor related claims. This makes up 49% of all claim complains. 4 207 of them were closed and 1 314 were resolved. The 2nd largest type of claim complains were made by homeowners. These complains made up 21% of the complains, while both commercial and household content related complains made up 7% of the claim complaints to Woods. The other 16% was made up of the many other types of insurance.
Woods also reported that among the large insurance companies, more than 1.1 million claims were received throughout. Of those claims 368,545 were received by Santam with 617 of them being referred to an ombudsman. Unfortunately, for the clients, only 146 were in favour of the client. Hollard received 363,898 claims, and 695 of them were registered with the OSTI, but only 202 were resolved in favour of the client. OUTsurance registered 279,437 claims, with 404 submitted to the OSTI, but only 47 resolved in favour of the client. No other registered insurance company received more than 200,000 claims.
Now that you have the facts, are you for or against insurance?