Published Date: April 26, 2023

The reason why people take out insurance policies is to protect themselves against risk. Whilst taking out an insurance policy is the most preferred and popular way of protecting one’s motor vehicle against risks, there are other further alternatives which car owners can opt for. In addition to taking out an insurance cover, one can deal with the issue of risk by: firstly, managing the risk i.e., implementing measures to restrict a possibility of any risk eventuating; or secondly, taking the responsibility for the risk if and when it eventuates. Thus, having an insurance policy, in most instances, is not compulsory. In some instances, a car owner has an insurance in place but prefers not to claim from his/her insurer and, instead, prefers to lodge a third-party claim. Consequently, there are many car owners who drive without insurance policies. The reality, nonetheless, is that no matter how careful and responsible one is on the road, the possibility of an accident occurring is realistic. It is, therefore, unsurprising that there are many third-party claims that insurers face. In what follows, this piece will furnish examples of instances where third-party claims can stem from; possible predicaments associated with such claims and ways to deal with such predicaments.

There are many reasons why people choose to lodge third-party claims (even those who have car insurance policies in place). These include, inter alia, an instance where a car is under insured; insurance is limited (not comprehensively covered); the damage is not so serious so as to warrant lodging a claim; or one is uninsured. Whilst the benefits of lodging and succeeding with a third-party claim are obvious, there are instances where such claims can create serious difficulties for the concerned car owner. These difficulties include: the success of a third-party claim is dependent upon the success of a first-party claim – thus if the insurer validly repudiates the claim of its insured, you, as a third-party, will not succeed; third-party claims tend to delay finalising, especially where the insured does not exert enough pressure on the insurer to finalise his/her claim; there are cases where the insured dies in an accident and, you, the third-party, has to wait for all the legal processes to unfold (and mostly the insurers delay investigations in such cases). When such difficulties present themselves, one of the ways in which you, as the third-party, can try and exert pressure for purposes of expediting the claim is to institute a delictual claim against the wrongdoer. In so doing, the wrongdoer is likely to feel the need to put pressure on his/her insurer. Where the wrongdoer is deceased, a third-party needs to find the details of the executor – so that he/she can claim from the deceased estate. It is important to note that in such cases, issues of prescription may arise. It is, thus, crucial to put every effort in trying to obtain such details and be able to issue summons timeously. Although one can argue that prescription cannot run until you obtain the details of the executor, you will still need to demonstrate to the court that an effort was made to secure such details timeously. Failure to demonstrate this may have undesirable repercussions. It is also important to bear in mind that a third-party does not have a legal claim against the insurer of the wrongdoer, and thus, cannot sue the insurer of the wrongdoer. Where the insured’s claim has been approved, the third-party can obviously pursue his/her claim against the insurer of the wrongdoer. If, however, one is dissatisfied with the pay out by the insurer, one can institute a legal action for the difference against the wrongdoer.

The aforementioned predicaments are not exhaustive but are amongst the most prominent. These difficulties highlight the significance of being insured and ensuring that your policy is valid at all times. If, however, you are uninsured and someone has caused harm to your motor vehicle, you should not hesitate to pursue legal action against the wrongdoer.

Mtho Maphumulo
Senior Associate | Litigation Attorney