Is RAF to take advantage of victims through Rabs?

IHAVE READ with interest the article of Lindelwa Jabavu, the acting chief executive of the Road Accident Fund (RAF). As background, I have been dealing with the RAF and its predecessors, the Third Party Insurance companies who acted as agents for the RAF, for more than 40 years. Unlimited claims are a thing of the past. The Amendment Act of 2008 put a stop to that. The loss of Income limit is now approximately R240 000 per year and anyone earning above that amount will have their claim limited in terms of the quarterly updates to this limit.

Furthermore, a claimant will only be entitled to General Damages if he qualifies in terms of the American Medical Association Guides to Permanent Impairment of 30 percent, know as a “Serious Injury”.

For example, an amputee with a below knee amputation, only qualifies at 28 percent. This seems very harsh.

The “Narrative Test” was introduced to allow in the alternative, a claim if the claimant had a Serious Long-Term Impairment or Loss of a Bodily Function. Before 2008, every Tom, Dick and Harry with a minor whiplash and sprained toe would have been entitled to make a claim. That is no longer the case. Only the most serious of cases qualify for General Damages. It is a long involved, complicated, expensive process to qualify for a “Serious Injury”.

The RAF is cumbersome, complicated, inefficient, and badly managed. For example, most claims above R1 million, are litigated on. The claims handler who has an assistant, reports to a senior, who reports to a manager, who reports to a general manager, and so on and so forth.

The local branch, say for example, Durban, has to report to Pretoria on any matter above R1m. Most claims are outsourced to attorneys to litigate and claims are not finalised until the judge walks into court, on the day of trial, because of the inefficiency in the RAF’s system. Additional costs are then incurred for advocates, and independent experts, who have to be paid qualifying fees, so on and so forth.

There is no need for this. The number of claims should have dropped substantially since 2008 as I have said probably only 10 to 15 percent of claimants now qualify for claims. For example, if you break your leg (femur) and it heals within a year, you will be left with no permanent disability and no claim for General Damages.

The allegation that “transaction costs enrich facilitators and not the victims of road accidents” is a misnomer and unfair.

The RAF under its previous chief executive, Dr Watson, embarked on an ambitious, aggressive, marketing and advertising campaign to solicit road accident victims to instruct the RAF directly, rather than utilise the services of attorneys.

The RAF, however, cannot wear “two hats”. It purports to represent itself, but meanwhile says it will assist “the victims”.

It does no such thing. Its takes advantage of the victim, under-compensating them, and they later have to go to attorneys who then have to sue the RAF for “under settlement” or allowing the claim to become prescribed.

The baby should not be thrown out with the bath water. The system is manageable if it operates efficiently. There is no need for a Road Accident Benefit Scheme (Rabs) Bill. The RAF issues an undertaking for future medical expenses, which it seldom honours. Claimants battle with the RAF to make payments according to the undertaking. Judge Satchwell in her report estimated that only 13 percent of undertakings were utilised for this very reason.

The only reason the RAF wants to introduce Rabs is to take advantage of road accident victims who will not be able to utilise the services of attorneys. MICHAEL FRIEDMAN ATTORNEY, DURBAN