Uninsured trucks: a massive risk in SA

The South African road transport and logistics sector is grappling with high levels of uninsured vehicles. This is a massive risk to owners of goods in transit and other road users, so what is the solution?

Owners of goods in transit and other road users face significant liability and risk to life from non-compliant operators running these uninsured vehicles. Justin Manson – of Webfleet, Bridgestone’s Mobility company – sat down with Basil Steyn of A2Z Insurance Administrators to unpack some of the industry’s challenges and discuss some improved approaches.

Basil, from your experience as an insurance industry professional specialising in commercial vehicles, are South African fleets generally well-insured?

Unfortunately, South Africa has some of the lowest rates of vehicle insurance, even in the commercial sector, where the consequences may be more costly to lives and property. From what we have seen, less than 60% of transport operators are insured.

What general behaviours do you observe from uninsured and insured operators?

One of the most troubling behaviours is that of uninsured operators closing down their businesses, only to re-open them under new names. This demonstrates a calculated intention to evade detection and continue to act unethically.

Even amongst those with insurance, we are seeing that they don’t have enough control of their fleets. They record excessively high mileage per month per vehicle, and remuneration of drivers is calculated per kilometre or per tonne, which inevitably leads to driver fatigue.

What are the most common risks fleet owners face, especially with regard to affecting insurance status?

In South Africa, crime is a major issue, both externally and internally. There are also not enough skilled drivers, while our road conditions are often not up to a good standard.

What can fleet owners do to mitigate against insurers voiding policies?

A simple measure that is often not considered is to ensure that the brokers they use are transport qualified.

What must fleet managers and drivers do continuously to ensure they are protected?

They need to understand the specific and changing road conditions on the roads they need to travel. For instance, apart from the weather and construction activities, they need to know where public unrest is taking place on any given day. They need to become proactive rather than reactive when planning routes, and they need to know areas where their fleet management systems may not have a signal. They need to be able to analyse information from their management systems easily for quick decision making.

What better incentives can be offered to fleet owners to become insured?

Incentives aren’t the answer. At the very least, third party insurance should be made compulsory, and owners of goods giving loads should insist on vehicle insurance and Goods in Transit (GIT) insurance, especially if the law should fail.