Road accident fund leaves middleman high and dry

2014-09-10 13:50

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Road accident victims could in future be forced to lodge claims themselves as the government aims to cut out lawyers from the process.

Compensation will also be paid out in the form of monthly benefits rather than a lump sum, but lobbyists against the changes fear that victims will be short-changed and that injury claim lawyers will go bust.

The suggested changes are outlined in the Road Accident Benefit Scheme Bill, which is currently open to public comment.

A young lawyer who preferred not to be named and who had been working with road accident fund claims for the past four years, said accident victims who had legal representation often got paid more compensation than those without.

One victim, Frans Mabitsi, received R38 000 after a serious accident in 2003. The road accident fund told him it was a good settlement, but after he approached lawyers, the payout rose to R1.5 million.

“A lot of claims are undersettled,” said the lawyer.

He also said it could be difficult for poor people to lodge and administer a claim, because they either had to travel long distances to do so by hand, or they didn’t have access to email and fax machines.

“I’m struggling to think how possible it will be for a client to administer a claim. It is not so difficult to submit a claim, but it is difficult to administer,” he said. “How will people do it when they are illiterate and indigent?”

He also said attorneys could find themselves out of work. He admitted that some defrauded the system, but said this should be dealt with by the relevant authorities.

But transport department spokesperson Tiyani Rikhotso said the scheme wasn’t aimed at lawyers, who could find other claims to do, but at road users.

“The existing scheme is not effectively achieving its purpose. The current scheme is open to abuse due to fraud, opportunistic claims, nuisance and overinflated claims, professional malpractice and human failing. The structure of the current scheme also encourages perverse incentives,” he said.

Rikhotso said the new benefit scheme would encourage people to go back to work. Under the current scheme victims benefited more if they presented themselves as permanently disabled and unable to earn a living in an attempt to get as much as possible compensation.

Victims are paid a portion of their income until they have been successfully rehabilitated and are able to return to work, he said.

Rikhotso admitted that the bill had not been costed yet. Lobbyists have expressed concern that the planned system – which will also enable victims of less serious accidents to claim – could turn out to be more expensive, necessitating a rise in the fuel levy.

Rikhotso said the department had obtained “actuarial calculations of the expected cost of the scheme” and this would be “updated as the bill is discussed and potentially amended”.

The Association for the Protection of Road Accident Victims – a lobby group including professionals and victims established earlier this year to push for changes to the proposed new Road Accident Benefit Scheme – said in documents on their website that the proposed new bill could present problems.

Some of their problems with the bill include:

» Claimants will have to fund medical costs and claim expenses themselves, and will only be reimbursed for these after their claim had been approved. Many indigent claimants would not have the means to lodge a claim in the first place;

» The benefit scheme can turn down a claim and claimants can only appeal to the body itself;

» Claimants will have to pay for legal representation from their own pockets;

» Once you are older than 60 you forfeit your right to claim from the benefit scheme because you are expected to support yourself from government’s pension funds. Children under 18 also do not have the right to claim;

» If you are a college of university student at the time of your accident, you are regarded as unemployed and future loss of earnings is not taken into account;

» Victims won’t be able to claim for pain and suffering; and

» Victims won’t be able to pursue a civil claim if they claim through the benefit scheme, although the transport department said the Constitutional Court found this was not unconstitutional.

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