1. will never forget the day, I witness the driver of a bus lose control while overtaking the fuel truck and fell into a ravine,” said Baraka Geofrey, (27), a resident of Magomeni in Dar es Salaam region.
Geoffrey lamented “I made follow-up with insurance company for the last four years, yet I have not been compensated to date, despite submitting the required documents. I wonder what will be my fate since I am the bread earner and my wife stopped working in order to take care of me.”
The case of Godfrey represents uncountable road crash victims frustrated by injuries. Some of them end up dying without being compensated by insurance companies in Tanzania due to un-clear insurance policy companies technicalities for compensation, which in most cases evade compensating road crash victim’s legal rights on what is needed to be paid and specific guideline for compensation based on insurance policy cover.
“It is expected that individuals who have suffered loss in a road crash through no fault of their own should be compensated in a fair and timely manner,” according to report by Land Transport Regulatory Authority (LATRA).
Compensation is therefore meant payment made to victim or victims of road crashes by insurance companies to cover the expense of treatment and income that the injured person earns in his or her daily activities.
The report explained that there is no mechanism in place to enable victims of accidents to go about after accident in order to realise their right for compensation.
“In reality most of them fail to seek compensation because they are not familiar with procedures to follow to get compensation,” the report noted.
“There is great need for insurance regulators to provide mass education to consumers (the public) on how to seek for compensation because it is so mandated, legally,” it stated.
“Also, it is high time that insurance regulators make amendments in the laws governing this sector in order to make insurers accountable as well as ensuring that the customers are enabled to make use of their basic rights for compensation,” it underlined.
Criteria for one to get compensation requires a person (passenger) of a bus to submit his or her traveling ticket, proof of injury in a medical doctor report, proof of income use to earn, and civil case for driver who caused the accident.
Data of injured people from Traffic Police
Traffic Police Commander, Fortunatus Muslim, said there are a total of 735 injured people who were recorded from January to March 2019 while there were 776 road crashes victims. Unfortunately there is no valid data indicating the number or percentage of victims compensated by insurance companies.
Legal counsel for Tanzania Insurance Regulatory Authority (TIRA) Margaret Mngumi said that access to compensation for victims of road crashes has been a challenge because there is no law which indicates specific amount sof what needs to be paid based on the kind of injury caused by an accident.
“This has being a long term problem caused by weaknesses present in the regulatory framework,” she said.
“The authority (TIRA) has acknowledged the problem and it has already appointed special team to conduct survey in different nations with best practice for compensation to learn from them, in order to see where we can work on to improve the legal framework and the system in general,” she said.
So far the team is still in the field and TIRA expect to receive set of recommendations from them to improve our insurance policy for a processing framework of claims, she said.
Advocate John Seka from Seka Advocates Company in Dar es Salaam said exclusively in a telephone interview that the great challenge is in the present legal system in our country is that there is no specific law that indicate specific amount of money to be paid to the victim of road crashes as compensation.
“Instead, ‘Law of Torts’ is currently used alternatively in law courts to settle matters pertaining to compensation. It is unwritten law being derived from the interpretation of the court,” he said.
He explained that due to those deficiencies, insurers opt to convene talks with victims to discuss and agree on the amount of money the company can pay a victim as compensation.
“However, there is no iota of doubt that most people (victims) are not satisfied with the amount of money they receive from insurers paid as compensation, and that is why there are lots of complaints to date,” said Seka.
In addition, he clarified that lack of knowledge on how to deal with insurance benefits and compensation remains a great challenge and setback to victims as opposed to the Motor Vehicle Insurance Act.
The advocate clarified that victims of road accidents are supposed to file their complaints to owners of the vehicle and driver, or owner of the vehicle and insurer or all three, and not the insurer only as stipulated in the Motor Vehicle Insurance Act 2002. This is tied to the fact thatthe basis of complaints lies on the contracts entered between the insurer and the customer.
Seka detailed that the complainant, he or she is also obliged to submit to the office of Ombudsman proof of injury, and this should be supported by evidence of traffic case to prove that the driver was careless on the road and caused accident. Treatment expenses incurred and other related losses have to be included.
He further recommended that the government needs to come up with a specific law that will specify minimum compensation to victims of road crashes as it is done to workers who are compensated at their work place.
Section 4 (1) of the Motor Vehicle Insurance Act Cap169 R.E 2002 discusses the liability of an insurer to pay compensation to a third party.
It states that “subject to the provisions of this Act, it shall not be lawful for any person to use, or to cause or permit any other person to use a motor vehicle on a road, unless there is in force in relation to the user of the vehicle by that person or that other person, as the case may be, such a policy of insurance or such a security in respect of third party risks as complies with the requirement of this Act,”.
Weakness in law
Article 107 (2) (C) of the Constitution of the United Republic of Tanzania 1977 states that “the Judiciary shall be the authority with final decision in dispensation of justice in the United Republic of Tanzania to award reasonable compensation to victims of wrong doings committed by other persons, and in accordance with the relevant law enacted by the Parliament.
Despite being legally mentioned in the Constitution and in the Motor Vehicle Insurance Act Cap 169 (RE.2002) on third party insurance, there is no clear legal framework for compensating victim or victims of accident based on the kind of injury he or she encountered.
Such legal weakness has denied a lot of victims of road accidents the chance of obtaining basic medical services; as a result they remain in a darkness of suffering.
The existing situation for compensation in the country
A report commissioned by the Land Transport Regulatory Authority (LATRA) formerly SUMATRA titled ‘Improvement of road safety in Tanzania Mainland’ of 2017 said the Motor Vehicle Insurance Act 2002 (RE 2002) makes it compulsory to have third party insurance when driving or permitted others to drive.
However, the report identified that there are no official guidelines for determining personal injury compensation values. Insurance companies usually make an offer based on the victim’s level of injury, age and average earnings. But most victims are not compensated from the insurer immediately after accident because of the cumbersome procedures involved thereafter.
Insurance companies say that motor vehicle insurance is a high-risk, low-profit business, lots of competition, while premiums for car insurance are low-earning types.
The report recommended the insurance regulator to review third party insurance cover limits regularly to ensure that they are in line with costs and are fair.
The insurance regulator should work on setting up a system allowing road accident victims to benefit from insurance immediately after an accident.
What the insurance brokers say about compensation
The president of the Tanzania Insurance Brokers Association (TIBA) Amir Kiwanda said insurance claims processing normally requires detailed documentation which often makes it cumbersome for claimants who are not conversant with the procedures.
“It could be deduced that insurance companies are enormous bureaucracies. This is so as a claim will only be processed if all supporting documents are availed timely,” he asserted.
“When an accident occurs, many victims are completely unaware of what procedures, documentation and other issues need to be completed or taken care of,” Kiwanda admitted.
“Without the aid of an insurance consultant, this information may escape those that require it most. In most instances, an accident with vehicles involved necessitates an insurance claim for damage to the vehicle, repairs and third party compensation,” he specified.
He also explained that the challenge to victims of crashes is bad perceptions they have towards insurance companies, taking it for granted that they are out to deny them their rights.
What the Tanzania Insurance Ombudsman (TIO) is doing
The Tanzania Insurance Ombudsman (TIO) is an Independent agency established under the Insurance Act no 10 of 2009, and started its operations in 2015.
The office is responsible to resolve insurance disputes in a timely and cost effective manner as an alternative to normal court litigation procedures.
Interviewed recently in Dar es Salaam, TIO official Fabian Mbegete said the main challenge afflicting many people who file their complaints is lack of knowledge on basic procedures.
“The majority of them end in complaining that insurers are downplaying their rights, particularly when they are asked to provide proof of income they earned before facing the injury. Proof of income has being a challenge to most people especially those who work in the informal sector,” he declared.
The officer said the Ombudsman has being receiving a lot of complaints categorized in four areas include disputes of quantum, repudiation, delay of payment and disagreements of interpretation in the agreement.
Claims are also made where a customer is not satisfied with the services (based on quality or time) provided by the insurer.
Complaints happen when there is a point of dispute on the agreement entered between the customer and insurer, the officer explained.
The Ombudsman recommended that insurance law be revisited and amended to contain and specify fixed amount of payment to a particular injury that the person has faced.
How the High Court handled a case for compensation
Last year in April, the High Court of Tanzania issued a judgment in a civil appeal case that originated from the Kisutu Resident Magistrate’s Court, between Michael Ashley the appellant versus two respondents, Anthony Pius Njau Ltd and Niko Insurance Tanzania Ltd.
The appellant Michael Ashley claimed from the respondents jointly and severally the sum of 45m/- being general damages for physical injuries he sustained after being involved in an accident caused by a motor vehicle owned by the first respondent and insured by the second respondent.
It was alleged that on 19th September, 2011 the appellant was at Magomeni area within Temeke district in Dar es Salaam region when he was knocked down by the motor vehicle owned by the first respondent and insured by the second respondent.
After the trial court heard the evidence from both sides, it decided the suit in favor of the appellant and award him the sum of 2m/- as compensation for pains he suffered after the accident, 800,000/- being costs and expenses incurred for treatment of the injuries he sustained and costs of the suit.
An exemplary example for compensation system practiced in South Africa
In South Africa, there is what is called Road Accident Fund (RAF), a juristic person established by an Act of Parliament, the Road Accident Fund Act, 1996 (Act no 56 of 1996) as amended (RAF Act).
The RAF is intended for providing appropriate cover to all road users within the borders of South Africa; rehabilitating and compensating persons injured as a result of motor vehicles in a timely and caring manner, actively promoting the safe use of all South Africa roads.
Section 3 of the RAF Act stipulates that “the object of the fund shall be the payment of compensation in accordance with this Act for loss or damage wrongfully caused by the driving of a motor vehicle.
“On economic side, the RAF provides a social security safety net to the country and economy by making available compulsory social insurance cover to all users of South African roads.
Contributions to the RAF are done by way of a levy on fuel used for road transportation. The cover extends to all members of society including but not limited to the poor, children, legal and illegal immigrants, foreigners, owners and drivers of motor vehicles as well as their passengers.
While on social role, the fund (RAF) integrates victims of road accidents into society, from a health and economic perspectives, protecting wrongdoers and their families from financial ruin.
This is done by the RAF paying the medical and related costs required to restore accident victims to health, compensating the victims or their families for income or support lost as a result of the accident.
Traffic Police principal legal officer Deus Sokoni said the best solution in relation to compensation is to make amendments in the present regulatory framework which does not relate to current changes and development.
“Principally, laws are subject to change based on particular environment in the society, hence existing insurance laws and the Road Traffic Act are supposed to be amended to match with the current development,” he insisted.