WEBSTER TWAAMBO, Lusaka
A STANDARD insurance policy in Zambia allows anyone to drive the insured motor vehicle provided they have a valid driver’s licence.
The other express condition is the age of the driver as well as their driving experience, usually restricted to 22 years and two years respectively.
Therefore, one may ask whether someone who obtains a licence at 18 and/or has less than two years of driving experience can duly drive a vehicle.
This is an important question I will belabour to address from the insurance perspective.
A few years ago, a certain man who had insured his vehicle, with a standard driver’s clause, had an unfortunate experience involving one of his children.
His son got the car keys without his permission and drove the vehicle only to be involved in a road traffic accident (RTA).
The son was below the age of 22 and had no driver’s licence.
The man logged in a claim and was unsuccessful on account of the driver not having a licence. In this case the insurer escaped liability, rightfully so.
However, what if the son had a licence but still below the age of 22.
Well, this seemingly discriminatory clause has some valid rationale vis-à-vis risk management purposes.
Evidence suggests that young and inexperienced drivers are more likely to cause accidents than older and more experienced ones.
This therefore increases the likelihood of the vehicle being involved in an accident when a young and/or inexperienced driver is driving the vehicle.
However, by law, any person at 18 years, is able to obtain a driver’s licence, ceteris paribus.
Therefore, how does this provision align with the ‘discriminatory’ driver’s clause in an insurance policy?
Well, there are some options to address such cases. This could be by way of deleting or modifying the standard driver’s clause so as to include young and inexperienced drivers.
Where the driver’s clause is deleted or modified, the policy will then open driving to include young and inexperienced drivers.
By so doing, the insurer may charge either additional excess or premiums or both.
Where additional excess is applicable, it means if the young and/or inexperienced driver is involved in an accident, when driving the vehicle, the claim will be admissible except that instead of paying a standard excess of say 10 percent, there will be additional excess, for example another 15 percent which brings total excess to 25 percent.
This will however depend on each particular insurer or policy.
The other option is where the insured pays extra premium so that the young and/or inexperienced drivers will be treated as though they were above 22 years and/or have had two years of driving experience.
Essentially, if the young or inexperienced driver cause a loss, they will be treated as though they were older or experienced.
The insurer would have collected sufficient premiums at inception to cover the increased risk and any driver with a valid licence will enjoy full benefits provided under the policy applicable to a driver.
The first benefit a driver will enjoy is personal accident cover which covers them against injury or death, permanent disability and medical expenses, caused by an insured event i.e. road traffic accident.
However, in our market, a standard motor policy does not cover personal accident to the driver, although some insurers do provide such cover on a standard policy.
It is important to clarify that a driver is not a third party under a motor policy. This is because, he is the insured and cannot claim from himself or herself. This applies even to other authorised drivers other than the owner.
During the period they are driving the vehicle, they enjoy the rights of the owner of the vehicle. However, in an event of a collision with other vehicles, the driver who was not at fault can claim as a third party from the driver who was at fault.
Further, death of or injury to an employee during the course of their work is not covered.
The intention of this exclusion is to allow a more appropriate policy to respond to such incidents i.e. employer’s liability policy.
Employers’ liability arises from vicarious duty and seeks to cover the employer against legal liability against their employees in the course of their employment. Therefore, if a driver is injured in a road traffic accident, then they will be compensated under an employers’ liability policy and/or a group person accident policy.
By applying restrictive conditions on young and inexperienced drivers, insurance effectuates risk improvements and collects sufficient premiums to the pool.
More so, recent developments such as usage based driving anchored on telematics, specifically addresses such constricting conditions by enabling drivers to pay premium based on vehicle usage and equally important get rewarded for good driving behaviour, a topic to be discussed soon.
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WEBSTER TWAAMBO, Lusaka