Risk implications of the new Road Accident Fund

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The trigger for the cover is an accident (as opposed to illness) and the compensation is based on the sum insured you select on Death, Permanent Disability, Temporary Disability, and Medical Expenses. Medicals are not required and age acceptance limits generally commence at age 15 and expire at age 70.

The new Road Accident Fund will apply to all road accidents that occur on or after 01 August 2008. The revisions can be summarised as follows:

  • Only reasonable medical costs will be covered and the compensation will be based on public health tariffs (which may be significantly less than the costs incurred if you use private health care)
  • Claims for loss of income will be limited to an amount of R160 000 a year irrespective of your income level
  • Claims for general damages will be allowed only if the injury is deemed serious
  • Claims for emotional shock suffered by witnesses to an accident will not be allowed
  • The common law right to sue for loss suffered beyond the new limits has been removed, except in the case of witnesses to accidents

The most far-reaching change, for both business and individuals, is the removal of the victims’ right to sue the negligent driver or employer of the negligent driver. This effectively means that the individual/business must ensure that they have an adequate personal accident, life/disability insurance, and medical expense insurance cover. Personal Accident insurance is now vital for those individuals who earn more than R160 000 per annum (as indicated in the revisions above)

The Solution…

Chadwicks offers Personal Accident insurance for individuals and businesses.

The trigger for the cover is an accident (as opposed to illness) and the compensation is based on the sum insured you select on Death, Permanent Disability, Temporary Disability, and Medical Expenses. Medicals are not required and age acceptance limits generally commence at age 15 and expire at age 70.

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