Tips to keep the consumer happy in 2018

ANEW year stretches out before us, and most of us are hoping for better things, but with the possible exception of winning the lottery, positive change only comes when we consciously change our habits.

I usually kick off each new year with my top advice on how to become a more savvy consumer. But this year I thought I’d asked the various Ombuds for their “If you do nothing else, do this” advice, based on their dealings with thousands of consumer complaints.

Given that all their offices are closed at this time of year, I was a bit doubtful of my success, but I’m happy to report that most of them responded, and very quickly too. Here goes:

“I witnessed it two weeks ago when I went to withdraw some cash. The machine accepted my card and PIN – and then none of the buttons seemed to work. So I cancelled the transaction and took my card. Then I noticed a middle-aged couple standing at the machine next to me, obviously distressed. I asked what was wrong and the woman said when they used the ‘stuck’ ATM I had just used, a man came to help and together they went to the other machine.

“And now ALL her money had been withdrawn from her account. I could see the shock and disbelief on their faces, and it was heart-breaking.

“The scammers obviously do something to one ATM, then offer to ‘help’ people, before skimming or swopping the card, and having seen them enter their PIN several times, they quickly go and withdraw the money from an ATM at the bank next door.

“I can think of many people who could be tricked in the same way.”

● If you are new to internet banking, as many South African consumers are, be very wary of the phishing scam – it’s the modern way to “steal”. For a scammer/hacker, it is relatively safe and efficient. They send the phishing e-mail (posing as a genuine e-mail from your bank, for example) to millions, knowing they will catch a few unsuspecting victims. Most are “older”;

● Get into the habit of reading and understanding all your statements – bank statements, bond statements, loan accounts, credit cards etc. Query charges which are not correct, query the interest rate and charges; look at what you owe and for how long you still have to pay, then find out what impact your paying a little extra every month would have. Millions of consumers never bother to do this despite the fact that their financial position is rather precarious.

● Remember to update your beneficiary nominations under both individual and group policies and ensure the updated nomination is recorded by your insurer. This is particularly important when there is a change in someone’s personal circumstances such as a marriage, a divorce, the birth of a child and the death of a beneficiary. The insurer will pay the death benefit according to the beneficiary nomination.

A beneficiary nomination has benefits – payment can be made soon, there is no need to wait for the estate to be wound up, and, because the proceeds do not fall into the estate there are no executor fees payable on the proceeds;

● When you take out a new policy or apply for new or increased cover, an insurer will ask you questions. It is extremely important to disclose accurate and complete information, because if you don’t, the insurer could repudiate the policy by relying on non-disclosure and any claim may then be declined. The duty of disclosure is an onerous one particularly for older applicants who may have forgotten some medical incidents. Rather disclose too much than too little. The nondisclosure also does not need to be linked to the cause of the claim, as is often mistakenly thought;

● Read all the exclusions in your policy. We have many complaints where claims are declined because of exclusion clauses, particularly the pre-existing conditions exclusion clauses which often come as a nasty surprise to claimants. They are usually found in credit life policies and other policies where the insurer did not use individual underwriting. Claims are then excluded if they are linked to a medical condition which existed prior to the inception of the policy.

The exclusion may operate for a specific period, such as 24 months, or for the duration of the policy.

● Garnishee Orders: Where the legality of the garnishee cannot be disputed, we encourage consumers to contact the creditor occasionally to establish the correct balance outstanding in respect of the debt and to request a comprehensive statement of account which should reflect all payments made to date , costs (legal, administrative and /or other costs) and interest.

Scrutinise and question the accuracy of the content of the statements of account. Very often, the consumer’s employer unknowingly processes the “final” debit order without having regard to interest and legal costs that may still be legitimately outstanding. This creates a misunderstanding and may also place the consumer who assumes that the debt is paid in full when indeed it is not, in greater financial difficulty as the consumer may have already made other provision for the use of the finances in respect of that debit order;

● Credit agreements in respect of vehicle finance – understand the concept and implications of a balloon payment deal. Make sure the agreed interest rate and contract duration is recorded in the contract. Don’t rely on any verbal undertakings unless they are recorded in the contract;

● If you’re in financial trouble immediately try to reach a mutually acceptable payment arrangement with the creditor, delaying them from proceeding with legal action which only adds to your debt.

Show good faith by not avoiding contact with the creditor as the creditor may trace you, and again this just adds to your outstanding balance. And make sure that any verbal undertaking is reduced in writing, unless the call is recorded. E-mail: Twitter: