The general not-too-favourable perception about insurance seems to be taking longer to be minimised than expected. Many persons still feel aggrieved by the way motor insurance claims especially are handled by insurance companies especially where the insurance companies, through due diligence, also become a bit suspicious of some claimants. The upward adjustment in motor insurance tariffs over a year ago indeed triggered a lot of discussions, especially around persons who felt aggrieved in the past due to a few previous experiences. A miner’s experience A pastor friend of mine who works in a mining company recently called me to express his displeasure at what he described as bad treatment from his insurance company. This was after he had made claims that were about to be paid only for the story to change in a very dramatic fashion following certain later disclosures. According to him, he was involved in an accident and made a claim. At the time of the accident, he was being driven by a friend because he was not feeling too well. After having informed the insurance company about what he intended doing to fix the damage while awaiting his compensation, he was given the green light from the insurance company after some inspection to go ahead to fix the damaged parts of his vehicle. He later submitted a bill with accompanying receipts, police reports, copies of roadworthy certificate and driving licence to the insurance company. The total cost of repairs was GH¢8,000. The insurance company promised to pay the claim subject to certain conditions thereafter. Two days after, he was called by the company that it was detected upon further investigations that the actual cost of repairs should have been GH¢3,500 and not GH¢8,000. The reason given was that he, on his own, purchased a brand new part to replace an old part that got damaged as a result of the accident instead of a used part. This made him upset the more with the impression that the insurance company was playing on his intelligence and thus frustrating him. He therefore vowed to change to another insurance company if this was how unfairly he was going to be treated. He confessed to me how he used unprintable words on the company calling them names, a strategy he adopted in order to intimidate them to pay his claim. Repudiation of the claim Upon further investigations, it was even realised that the claim had had to be repudiated entirely as the copy of the licence given them had expired at the time of the accident. To make matters worse for my friend, he was painfully told that he would not even get the GH¢3,500 again as computed earlier because they had detected that he didn’t have a valid driving licence at the time of the accident and that in itself was a criminal offence. He flared up and made reference to all his knowledge in legal and finance matters and threatened to escalate the matter to the National Insurance Commission (NIC) for redress. A bad situation made worse The insurance company, with yet another information, got to know that the licence given as the one belonging to the vehicle owner was in itself wrong because he was not the one driving at the time of the accident and that raised issues of a suspected fraud. Indeed, he explained that he owned the car and could do whatever with it and didn’t think there was an issue with asking a different person to drive his car. When asked to bring a copy of his friend’s driving licence, it turned out that his driver friend did not even have a licence! As I explained to my pastor friend, in this case, the sticky nature of his claim and what he stood to go through legally, he easily concluded that he thinks insurance should be made optional as insurance companies simply rush to collect premiums but only frustrate clients in the event of claims. Does he have a case? The answer is Yes and No! Yes and deservedly so because the damage had indeed occurred and he deserved to be paid his claim. However, issues regarding documentation, disclosure and an inadvertent attempt at benefitting more than desirable ‘spoilt his matter’. Indeed, the insurance company would have been right in paying him GH¢3,500 and not GH¢8,000 as they had to factor in depreciation costs. But this could only be made possible if the driving licence of his assignee driver was valid. In insurance, it can be impugned that a driver of a vehicle without a valid driving licence is a moral hazard and more likely to cause an accident than one with a licence, all things being equal. Utmost good faith compromised There is no doubt the fact that my pastor friend failed to demonstrate the principle of utmost good faith or out of ignorance did not know the implications of his ‘right’. This is because he apparently concealed the fact that he was not the one driving his vehicle at the time of the accident and that he had assigned a friend to do so. It could also be that knowing his friend was an unlicensed driver, he decided to take responsibility for the accident once he had a supposed valid licence to prove. Sadly though for he himself, his driving licence as of the time of the accident had expired! Similarly, out of ignorance or some desire to exploit the system, he purchased a new part to replace an old part and this in itself goes to suggest that he attempted profiting from insurance contrary to the concept of insurance where one is only indemnified at the exact value of an insured asset at the time of the loss/damage. Responsibilities of insurers The insurance spectrum is a highly technical one; as such, regular stakeholder education is imperative, particularly on policy details in order to manage fallouts from dishonoured claims. For instance, in the context of Ghana, crisp and exciting documentaries and brochures on specific policy details and claim processing, translated in various local languages, could be used as promotion materials to help in public education. Invariably, this will help a great deal in reducing the negative perceptions some members of the insuring public have about motor insurance in particular and other lines of insurance in general. Responsibilities of policyholders The insured motor vehicle owners must also spend time to read policy certificates issued them and ask questions before, during and after an insurance arrangement and also to be very open with the facts to their insurance companies. Without attempting to hold brief for any insurance company, I do not think there is any insurance company in Ghana that desires to make life uncomfortable for its clients. However, developments of this nature account for some of these unfortunate and undue delays in the payment of motor insurance claims.
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