How alcohol abuse affects your insurance: A sobering reality
If you have an accident after driving drunk not only will you have to deal with the trauma of such an experience but your insurer could refuse to pay out any related claims leaving you severely out of pocket, finds Angelique Ruzicka.
Between 20, 000 – 25, 000 people die every year as a result of drunk driving in South Africa according to the World Health Organisation (WHO). But the thought of death or injury is not on the mind of the drunk driver whose sole focus is usually to get home as quickly as possible without being caught by the police. Instead, all manner of tactics are adopted to avoid detection from using back roads to lesser-used roads to get home.
What many road users fail to consider is the devastating financial effect that driving under the influence may have in the event of an accident. This is because the majority of insurance policies exclude cover for any loss or damage in circumstances where it is found that an insured driver was under the influence of alcohol or drugs at the time of an accident or that the percentage of alcohol in his or her blood exceeds the legal limit.
Many drivers don’t know that insurers don’t need to prove that you were drunk behind the wheel in a court of law to reject any claim you make after an accident. “In criminal cases, in order to meet a charge of drunken driving or driving under the influence the State is required to demonstrate beyond a reasonable doubt that a driver was indeed driving in such a state. In civil cases, however, such as claims under the insurance policy, the insurer need only show that the insured was, on a balance of probabilities, driving under the influence,” says the Ombudsman for Short Term Insurance (Osti).
This means that the insurer doesn’t even need to depend on the results of a blood or breathalyser test confirming that you were over the legal limit. “Insurers can and mostly do conduct their own investigation and rely on both circumstantial and objective evidence in order to paint a picture of the most probable scenario at the time of the incident and the events leading up to the incident,” explains Geoff Kaufmann, accounts executive at Garrun Group Insurance Brokers.
While insurers don’t have the same powers as the police, their investigations into whether a client was in fact driving drunk can be quite extensive. “Insurers often use specialist forensic investigators to investigate these claims. This extends to interviewing witnesses, viewing CCTV, obtaining copies of the restaurant or bar bills, etc. Where consent forms are required to obtain information these will be obtained from the client,” says Sven Veltman manager of personal lines claims of the Claims Fulfilment Company (Pty) Limited, a subsidiary of Aon South Africa.
Wynand van Vuuren, head of legal at King Price Insurance, further explains: “Your insurer has the legal right to conduct its own investigations in the case of an insurance claim. This will generally happen if the accident scene does not seem to match your story or contradicts the police report or eyewitness accounts. This is made more likely when breathalysers or blood tests are not done, or when blood tests are done but are misplaced.”
If your claim to the insurer gets rejected for suspicion of drunk driving not only would you have to foot the bill for your own medical costs and damage to your car but you’d have to pay for the medical costs of others involved in the accident and damage to their vehicles too.
Incorrect or dishonest information
If you think you will get around a possible rejection on a drunk driving claim by lying, there could be severe consequences if you get caught telling fibs. If insurers suspect you could be lying they are well within their rights to investigate the circumstances surrounding your claim.
In a specific complaint referred to the Ombudsman, the insured’s claim was rejected by the insurers on the grounds that the insured provided the insurer with dishonest information regarding the manner in which the accident occurred and his whereabouts prior to the accident. When reporting the claim the insured informed the insurer that he had visited his sister at her house immediately prior to the accident and that he was alone in the vehicle and on his way back to a guesthouse that he planned to stay at for the evening when the accident occurred. The accident occurred around 2am on a Sunday morning.
But after investigating the claim the insurer established that the insured had in fact been at a nightclub prior to the accident and that he had two passengers in the vehicle with him when the accident occurred. “Because investigations could not be carried out after the accident, the insurer was unable to determine whether or not the insured had consumed alcohol at the nightclub. This inability to investigate the claim properly resulted in prejudice to the insurer and it accordingly declined to pay the insured for the damage to his vehicle. The insurer’s decision to reject the claim was upheld by the Ombudsman,” says the Osti.
Besides not having your claim paid out you also run the risk of never being insured again if you’re convicted of drunk driving or if there’s suspicion about you being drunk behind the wheel. “If you’re convicted for drunk driving your insurance company could decide that you are a high-risk individual, and so they may refuse to continue your car insurance cover. Further, should your driver’s licence be suspended, you won’t be able to get car insurance anywhere,” explains Willem Smith, managing director of Hollard Personal Lines.
If your insurer decides to keep you on as a client or pays out your claim after you were suspected of being drunk while driving, you may have to pay more in future. “If your insurance company does decide to pay out your claim, it’s likely that your car monthly insurance premium – the amount you pay your insurance company each month will increase fairly significantly. This is because you are now considered a high risk driver,” says Smith.
Think before you drink
It’s easy to lose track of the number of drinks consumed after a night out and you may ‘feel fine’ to get in a car and drive yourself home. But the risks of doing so are great, particularly because you’re unlikely to be the only drunk driver on the road. Six out of ten drivers who die in accidents have dangerously high alcohol levels in their blood according to www.alcohol.co.za. The site also points out that when you are on the road at night, one out of every seven drivers sharing the road with you, is drunk.
Getting behind the wheel drunk not only puts your life at risk but you could also land yourself in serious financial trouble if insurers find proof that you were or could have been drunk behind the wheel.
If you find that you’ve overdone it this festive season remember that there are alternatives to getting in your car and driving home drunk. A number of companies, including banks and insurers, now provide ‘take me home services’ for their clients. Three of the big four banks: Standard Bank, Absa and FNB offer a certain number of free rides per year to customers. Meanwhile, OUTsurance offers an alternative through its Buddy@Out scheme to its customers. The subscription fee to the service is R20 a month.
“Buddy@OUT is an OUTsurance initiative where we – together with Goodfellas – help our clients get home safely after they have enjoyed a few alcoholic drinks and could be under the influence of alcohol. With Buddy@OUT our clients get access to this program at much reduced rates,” says Natasha Kawulesar, head of client relations at OUTsurance.
If your bank or insurer doesn’t offer a ‘take me home’ scheme there are always alternatives. “If you are going out in a group, have a designated driver who does not consume alcohol who can get everyone home safely or else make use of services like Uber,” advises Kawulesar.