Tag Archive | Road Accident Fund

road accident bill South Africa

Road Accident Benefit Bill changes everything

Road Accident victims paid out regardless of fault…

A draft Road Accident Fund Scheme Bill was recently published for comment by the department of transport (DoT) as part of the new “no fault” scheme of benefits, the Bill establishing an office of an administrator to implement and subsequently administer the scheme of injury and death benefits.

The idea of a no-fault approach to compensation, says DoT, is in part to respond to the problems identified with the current fault-based approach, and also to improve and simplify claims procedures so that claims are more speedily dealt with.

This is distinct from the present “insurance-based” procedure where the question and quantum of liability can drag on for years in the courts, the department says in its background document.

Social security first

The Bill seeks to provide for a social security scheme for the victims of road accidents for bodily injury or death and will exclude liability of certain persons otherwise liable for damages in terms of the common law.

DoT says the proposals state that “no civil action for damages in respect of bodily injury or death”, in the case of a road accident, be pursued against any owner’s vehicle involved, drivers or employers of drivers.  Rather, payment is made in terms of the defined benefits of the new scheme regardless of who caused the accident.

DoT says the new Bill forms part of an initiative to replace the third party compensation method with a system that is “reasonable, equitable, affordable and sustainable”.

Public comment was open on the new draft Bill until early September and considerable debate will probably ensue in parliamentary hearings on the question of the extent of the benefits schedule and quantum.

 

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New Road Accident Benefits Scheme based on “no fault”

Schedule of benefits

A revised draft Road Accident Benefits Scheme Bill, designed to provide a social security scheme for the victims of road accidents, is to be tabled in Parliament to provide a set of defined benefits on a no-fault basis for injury or death arising from car accidents.

At this stage, a draft has been published by the department of transport (DoT) for comment by early July 2014.

The idea of a no-fault approach to compensation is in part to respond to the problems identified with the current fault-based approach, and also to improve and simplify claims procedures so that claims are more speedily dealt with.   This is distinct from the present “insurance-based” procedure where the question and quantum of liability can drag on for years in the courts, the department says.

No civil actions

DoT says the proposals will remove the possibility of civil action for damages in respect of injury or death arising from road accidents instituted against the owner or driver of a vehicle as well as the employer of the driver.

The scheme envisaged by the draft Bill lists a number of stated benefits which can be applied. The administrator of the scheme and his department will have six months in which to accept or reject a claim.   If accepted, payment will be to the claimant within 30 days.

Some of the benefits include health care services, income support, family support and funeral expenses. Payments will be made in respect of medical bills direct to medical parties.

Scheme administrator

Department of transport says a road accident benefit scheme administrator (RABSA) will be appointed and placed in charge of compensation of defined benefits, rather that drawing court awards with legal costs from the road accident fund (RAF), which in turn will fall away.
The key change proposed by the draft legislation is a move away from the insurance-based system of compensation which has been largely unchanged in South Africa since its inception in 1946, to a system of defined and structured benefits.

Legal experts dealing with past claimants requesting payment from the RAF have commented that no compensation will be payable in terms of the proposed schedule of benefits for pain and suffering; loss of amenities of life; disfigurement and emotional suffering.    Also they warn that the cost of running the administration of such a system as RABSA is likely to “eat up” reserves.

More importantly, they say, the legislation “suggests” that only state healthcare and state tariffs would be provided for.

Insurance-based system out

On the subject of the key changes from the insurance-based system, DoT says the proposals state that “no civil action for damages in respect of bodily injury or death” in the case of a road accident be pursued against owner’s vehicles involved, drivers or employers of drivers.  Rather, payment is made in terms of the defined benefits of the new scheme regardless of who caused the accident.

DoT says the new Bill forms part of an initiative to replace the third party compensation method with a system that is “reasonable, equitable, affordable and sustainable”.

Other articles in this category or as background
http://parlyreportsa.co.za//finance-economic/road-accident-fund-mess-continues/

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Road Accident Fund mess continues

In terms of its annual report tabled before Parliament recently the Road Accident Fund (RAF) remains technically bankrupt according to its CEO, Eugene Watson who was appointed to the post recently.

“The Road Accident Fund incurred a net loss of R16.487m during the year ended March 2012 and, as of that date, the entity’s total liabilities exceed its total assets by R46.395m”, he told parliamentarians.

In a separate report but incorporated into the presentation, the auditor general’s remarks were highlighted where it was stated that the financial position cast doubts on the RAF to operate as a going concern and there still be a lack of controls to curb the wastage of unnecessary expenditure.

Watson said funding models were being considered as an alternative, including funding from the road levy. Both funding and the approach to claims had to be re-considered, he said.

“The fund recorded a deficit of R16.5 billion in the financial year under review compared to a net deficit of R1.5bn in the previous year,” said Watson and this was as a result, he said, in provisions having to be made for outstanding claims. The figures he presented showed an increase from 2010/11 of R34bn to 2011/12 at R54bn.

The report highlights the fact that thousands of claimants have outstanding compensation cases and many involve claims serious injuries. Some of the claims have been outstanding for a number of years.

“Government need to consider interim legislative measures to ensure that inefficiencies in the current compensation system, which we cannot control, are contained”, he told the committee parliamentarians.

 

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