The new demerit system for SA road users has good intentions, but it can also pose a significant threat to the insurance industry, cautioned Vera Nagtegaal, executive head of Hippo.co.za.
President Cyril Ramaphosa signed the controversial Administrative Adjudication of Road Traffic Offences (Aarto) Bill into law on Tuesday and will be implemented once the law has been gazetted with a commencement date.
The Act sets up a demerit system for drivers, who lose points for traffic offences, which may result in the loss of a driving licence.
Nagtegaal explained that implementing the demerit system has numerous implications for the insurance industry, which already has low penetration among motor and other vehicle class owners.
"The suspension of a motorist's license is likely to increase their insurance premiums or excess, influenced by greater perceived risk on the insurer's part," said Vera Nagtegaal, executive head of Hippo.co.za.
This poses further applicable considerations:
How will an insured motorist afford higher premiums or excess when their license gets suspended?Will the motorist with the suspended license forfeit their insurance cover and thereby be precluded from obtaining vehicle insurance from any other service provider?How will this affect the insurance industry at large?A reduction in the industry's size will invariably lead to job losses - how will these individuals be absorbed into the labour market?
With the top priority of reducing South Africa's stubbornly high road fatalities and accidents, Nagtegaal said campaigns need better targeting and better consultation with industry.
According to Nagtegaal there have been several deficiencies in road awareness campaigns launched over the years.
"These campaigns have simply targeted motorists instead of incorporating education programmes also aimed at teaching pedestrians about road safety and taking responsibility for their individual conduct when making use of road facilities."
Pedestrians accounted for the largest proportion of total road fatalities in 2016 at 38%, according to the Road Traffic Management Corporation. Road casualties among passengers and drivers came in at 33% and 26% respectively.
Nagtegaal pointed out that what is evident is that a more holistic educational approach is needed to eradicate reckless driving by motorists, and encourage pedestrians to exercise greater caution when crossing our roads.
Meanwhile, the Organisation Undoing Tax Abuse (Outa) indicated on Friday that it is challenging the Aarto Bill.
"OUTA has opposed this Bill from the start and is now planning a constitutional challenge to it," said Outa portfolio manager on transport Rudie Heyneke.
Outa said pilot projects in Tshwane and Johannesburg using this system over the past decade failed.
"The focus should be on road safety, not on an administratively complicated system aimed at collecting revenue," said Heyneke.
"We need solutions on road safety, but this isn't one of them. We want to see a workable law," he said.