Motorists worry broken driving licence card machine could affect their insurance cover

Insurers expected to not reject claims solely because a driver’s licence has expired – SA Insurance Association.
Motorists wanting peace of mind can apply for a temporary driving licence, but they are only valid for six months and cost R90. Image: Shutterstock

Many motorists are concerned about the insurance implications of being involved in an accident or insured incident while driving without a valid driving licence card because of the breakdown since November 7 2021 of the machine that produces the card.

The Department of Transport (DoT) confirmed there was a backlog of 383 000 driving licence cards as at December 1 2021 because of a breakdown of the card-producing machine.

Transport Minister Fikile Mbalula said last week the broken machine is being fixed in Germany and should be back in South Africa by March.

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SA Insurance Association (SAIA) insurance risks manager Zakes Sondiyazi said on Tuesday the association and its motor members have fortunately experienced such a situation before and all motor related claims during these periods “were handled quite well”.

Sondiyazi said there were huge backlogs in the issuing and renewal of drivers’ licences when the Covid-19 pandemic started and also in March 1998 when the card format licences were introduced in South Africa.

“Although each insurer would treat each claim in accordance [with] their rules and procedures, generally and in principle, motor members are expected to look at the full merits of the claim holistically before making a decision and not reject claims solely because a driver’s licence has expired,” he said.

Sondiyazi added that insurers, for example, need to look at the following:

  • Is the claim because of an insured event, such as an accident, fire or water damage, and so on?

  • Is the damaged vehicle insured?

  • Who is the regular driver?

  • Use of vehicle (private or business)?

  • Any other matter that is of a material nature and could have prejudiced the insurer.

Sondiyazi added that the Ombudsman for Short Term Insurance made a ruling on this issue in 2007 and mentioned: “To determine an equitable outcome, the insurer would need to demonstrate prejudice because of the failure to be in possession of a valid licence, therefore materiality is a critical factor for consideration.”

Sondiyazi said this means in essence the insurer would need to prove if possession of a valid licence was material and is directly relevant to the claim.

“In such a situation, a claim might be rejected. Therefore, we believe the motor claims which happen during the broken driving licence card machine [period] would be treated in the same way as the ones mentioned above,” he said.

Then Ombudsman for Short Term Insurance Brian Martin said in 2007 that should his office receive a complaint where an insurer has rejected a claim because the driver did not have a valid driver’s licence, or a vehicle was not roadworthy due to an expired licence disc, “we would not necessarily support the decision”.

“To determine an equitable outcome, we would ask the insurer to demonstrate prejudice as a result of the failure to be in possession of a valid licence,” he said.

However, Martin stressed there are different legal implications for drivers if they fail to convert their identity document driver’s licence to the card format as opposed to renewing their card format licence.

If they fail to convert their identity document licence to a card licence they will no longer be deemed to be a licensed driver and will have to be retested, he said.

But Martin said the failure to renew a card licence is different as a motorist will still be in possession of a valid licence albeit without the required proof and may be subject to a fine if stopped by a traffic officer for not being in possession of a valid driver’s licence.

“However any insurance claim you may have should not be affected, as you will still be deemed to be a licensed driver,” he said.

‘Be proactive’

Sondiyazi highlighted that SAIA advises policyholders who are affected by the delay caused by the broken machine to proactively contact their broker and insurer and inform them about their predicament.

“Such action could bring comfort to the policyholders,” he said.

Motorists who want to avoid any insurance issues from not having a valid driving licence card because of the breakdown of the card-producing machine, despite timeously applying to renew it, can obviously apply for a temporary driving licence at any Driving Licence Test Centre (DLTC).

However, a temporary driving licence is only valid for six months and may expire before a motorist receives their new driving licence card, forcing them to apply for another temporary driving licence.

A temporary driving licence currently costs R90 per licence, which many poor people may be unable to afford.

Both the Automobile Association (AA) and the Organisation Undoing Tax Abuse (Outa) have been outspoken in their criticism of how the breakdown of the machine has been managed and the lack of information provided to the general public.

The organisations also stressed that it is wrong and unfair to expect motorists to have to pay for a temporary licence when they have applied in good time to renew their driving licence card.

Mbalula said last week an announcement will be made about the temporary licence cost issue but did not indicate when it is likely to be made.

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