Plans to change vehicle insurance

The Competition Commission has put forward draft guidelines that could change vehicle insurance and warranty plans. The aim is to enforce anti-competitive behavior in the automotive industry.

As of right now, many vehicle owners are locked into services and parts that have been approved by their dealers or vehicle insurers. This lead to small and medium-sized businesses voicing concern for being shut out of the market. These are the businesses that these regulations hope to promote.

Plans to change vehicle insurance — Photo by **Malte luk** from **Pexels**

Under these guidelines, vehicle insurers will be required to approve any service provider with the required standards as well as share them with their clients. Vehicle owners will also be able to choose any service provider they wish, even if they are not approved, and not have their vehicle’s warranty voided.

Parts replacement could also fall under the same guideline. Once the warranty for a specific vehicle part has expired, buying a third party replacement could often lead to voiding the whole car’s insurance. Under these regulations, they will not, allowing vehicle owners a cheaper option when replacing parts.

All these changes will allow more options for South Africans and allow other service providers to grow in the automotive market.

The deadline for submission of comments on the guidelines is 16 March 2020. Then a final set of guidelines will be implemented as part of the Competition Act.

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Source: Business Tech

Stuart Smith

A copy and content writer at Web2Web with a passion for sharing engaging content. He loves his old Toyota Corolla and talking about new cars, particularly about the technology that changes the way they are designed.