Drink driving exclusion – the onus of proof lies with the insurer!

Gareth Stokes, FAnews Online Editor

We had a number of responses to last week’s newsletter, titled: Your insurance won’t pay if you mix alcohol and driving. Of particular interest is the detailed response from Brian Martin, Ombudsman for Short-Term Insurance, who we approached for comment before the newsletter went out. Martin wasn’t able to help with statistics of short-term insurance claims linked to drink driving, but admitted: “The issue crops up regularly and we receive, in general terms, more complaints concerning the rejecting of liability on the grounds of the driver being under the influence of alcohol than we do, say, on the grounds of the vehicle being un-roadworthy.”

Martin was in “general agreement” with the comments supplied by short-term insurers Mutual & Federal, Santam and Zurich, but singled out a few issues his Office took exception to. The following is Martin’s unedited response:

Alcohol involved in 70% of road traffic accidents

“Driving whilst under the influence of alcohol is a major problem in South Africa. It has been estimated that alcohol is involved in some 70% of road traffic accidents. There can be no doubt that the consumption of alcohol seriously affects co-ordination and reaction time when driving a motor vehicle. A person driving a motor vehicle whilst under the influence of alcohol poses a significant threat of harm to both themselves and to others. Unfortunately South African drivers, particularly young persons, fail to recognise this threat. Due to the pervasive culture of lawlessness most people simply adopt the attitude ‘I won’t be caught’ or ‘I will take a chance’, without any appreciation of the very significant consequences which will follow if they are involved in an accident or caught driving whilst under the influence of alcohol.

“Consumers often confuse a criminal conviction and the standard of proof required for a criminal conviction with the standard of proof required in a civil case or the standard of proof that will entitle an insurer to reject liability for any claim. Consumers tend to believe that unless they are criminally convicted the insurer is not entitled to reject liability. This is clearly incorrect and the comment made by Gerhard Genis of Santam in this regard is absolutely correct. The rejection of liability will be upheld by this office if the insurer is able to prove, on a balance of probabilities, that the insured driver was under the influence of alcohol, or had a blood alcohol concentration in excess of the statutory limit.

“However, the onus of proof lies with the insurer. The insurer must establish that the exclusion applies on a balance of probabilities. In this regard the insurer may rely on any admissible evidence including circumstantial evidence. This office usually considers whether there is reliable objective evidence to establish that a person was under the influence of alcohol. This will involve a consideration of the evidence of lay persons, particularly if these persons have specialist knowledge and training such as police persons, paramedics and other medical personnel. Hospital records play a vital role too. Regard will also be had to evidence indicating the quantity of alcohol which a person consumed and the circumstances in which it was consumed. Some insurers are able to obtain copies of restaurant bills and other documentation to support their contentions. Reliance is also placed upon the opinions of expert witnesses in appropriate cases.

Delays in criminal justice system cause for concern

“The deficiencies in the criminal justice system are one of major reasons why people continue to take a chance in drinking and driving, unlike the position in Europe. There are unacceptable delays in blood samples being processed. However, an insurer has the right to have any blood samples submitted to a private pathology lab for testing and insurers are encouraged to make greater use of this alternative. An insured person is entitled to be assumed to be innocent of any breach of a policy term and condition unless the contrary is proved by the insurer and the general principle that a person is presumed innocent until proven guilty applies equally well in this type of situation.

“The delay in obtaining the results of blood alcohol tests can occasion severe hardship and prejudice to the insured. It is the policy of this office to require an insurer to establish any alleged breach of a term or condition, or that the claim falls within the ambit of the exclusion, within a reasonable period of time. An insurer is not automatically entitled to withhold settlement of a claim or indemnification in respect of a third party claim simply because there may be an outstanding blood alcohol test. The blood alcohol result is not all inclusive and the other surrounding evidence must be considered. If the delay is unreasonable, the matter will be considered on the basis of the other available evidence and the insurer may be requested to pay the claim if the delay in the criminal justice system is occasioning undue hardship or prejudice.

“In some instances this office has directed that the insurer should, pending the outcome of the blood test or criminal investigation, pay the value of the claim into an interest bearing account, or may direct that the insurer pay the claim subject to the insured furnishing security for the repayment of any amounts paid in the event of the blood alcohol test, later establishing that the insured was under the influence of alcohol. Each case must be assessed on its own merit.

Don’t expect any sympathy from the Ombudsman

“Persons who drive whilst under the influence of alcohol must not expect any sympathy from the office of the Ombudsman, but at the same time insurers are expected to act objectively and responsibly when considering the rejection of liability, having regard to the severe and far reaching consequences that can follow upon the rejection of liability. Many a person, particularly young persons, have found their lives devastated as a result of an act of rashness, when the insurer has rejected liability for a claim, leaving them not only with a substantial debt in respect of a written off vehicle, but facing potential huge third party liability claims which may cripple them financially for the rest of their lives.

“The message for all South Africans is simple: A motorcar is a dangerous article at the best of times, but in the hands of a drunken person becomes a lethal weapon. Do not drink and drive.”

Editor’s thoughts: When it comes to drink driving and insurance we believe the best policy is a ‘prevention is better than cure’ one. If you don’t want an insurance claim rejected due to contraventions of the drink driving exclusion then don’t drink and drive – ever! Have you had any experience with insurers rejecting claims on a suspicion of drink driving? Add your comments below, or send them to gareth@fanews.co.za