How the Aarto system will potentially impact your insurance cover

There is  huge concern about the implementation date of the driver demerit system, so drivers have been urged to be more responsible and take the rules of the road more seriously.

The original implementation date was 1 July, but doubts have surfaced whether the Administrative Adjudication of Road Traffic Offences (Aarto) Act will be signed into law in time.

The Department of Transport could not be reached for comment and clarity on the confusion.

“We realise that licensed drivers are concerned regarding the confusion around the implementation date,” said Christelle Colman, spokesperson for Old Mutual Insure.

“We urge all drivers to take the pending Aarto regulations seriously and continue to be responsible road users, despite the uncertainty.”

ALSO READ: ‘Aarto rollout mired in confusion, drivers in the dark’, says AA, hours ahead of implementation

Colman said that the company was also looking forward to receiving clarity about the implementation of Aarto.

She said that with the uncertainty about the rollout, drivers are unsure about what to do should they find themselves on the wrong side of the new regulations and how this will impact their insurance.

“In the long term, the Aarto enforcement ought to impact favourably on the cost of insurance while reducing the number of unlicensed drivers and vehicles on South Africa’s roads,” Colman said.

She said that this would also improve driver and vehicle data, reduce the cost and maximise the positive impact of insurance in South Africa.

“All companies offering short-term car insurance require that drivers of insured vehicles have valid drivers licences.”

The risk of a client clearly changes if a licence is suspended or withdrawn and it will be the client’s responsibility to update his/her insurance accordingly.

She further added that Aarto would benefit drivers and policyholders over the long term as it would assist in pricing premiums more accurately.

“The demerit system could potentially be linked to an underwriting criteria as it does reflect driving behaviour. Drivers with poor records on this system could face higher premiums, but that would be at the discretion of each company.

“The highest risk is that drivers could lose their licences due to speeding fines (even minor ones) which could potentially mean their existing motor policies will not respond or they will not be able to get motor insurance.”

Colman said that there was already a very high percentage of uninsured vehicles on the road.

“This will increase uninsured vehicles on the road and have a severe impact on the recovery process after an accident.”

She urged policy holders to be aware what the implications of the zero-alcohol limit is on insurance.

READ AGAIN: Dissecting the incoming Aarto demerit system for drivers

Drivers who accumulate more than the stipulated number of demerit points will effectively lose their drivers licence and will not be able to claim from their insurance company in the event of an accident.

She warned that the devil is in the details of the implementation of Aarto.

“If poorly implemented and not supported by an efficient licensing process, the opposite may well be achieved. Clarity is needed to avoid confusion,” Colman said.

She said if not properly enforced, the system stands the chance of widespread non-compliance and even legitimate legal challenges.

“We encourage all drivers to be responsible law-abiding citizens on the road and to be mindful how their driving could impact insurance cover. Should they not do so, it could lead to financial losses and complications.”