How much money does the Road Accident Fund lose due to fraudsters?

Firstly, the concept of the Road Accident Fund in South Africa is a noble one. Because, in many instances, it has been a source for good. It has paid out millions to people whose lives have changed inexorably after major accidents.

However, to fund the Road Accident Fund, a levy is added to every litre of fuel sold in South Africa. This is 10% of the fuel price and equates to roughly R2.18 per litre. However, a presentation by the Actuarial Society of South Africa (ASSA) sheds new light on the just how much RAF money is being siphoned through bogus and inflated claims.

ROAD ACCIDENT FUND LOOTING

Daily Investor reports that the Road Accident Fund loses R3 billion a year through opportunistic and non-serious claims. Actuary Gregory Whittaker says individuals who only suffer minor injuries are claiming for excessive amounts.

Furthermore, data released by the RAF shows it paid R22 billion in loss of income claims by 31 March 2023. Of this, approximately 14% was paid for non-serious injuries. Assuming 14% of the total loss of income claims was paid for non-serious injuries, this equates to R3 billion for the year.

CHANGES TO THE RAF

Moreover, the RAF Amendment Act of 2005 allows for general compensation not quantifiable in monetary terms, such as pain and suffering. Whitaker believes this has led to widespread abuse of the system, costing taxpayers billions every year.

Furthermore, Road Accident Fund claims have skyrocketed over the years. In 2008, 5 957 claim payments were made. In 2023, this sits at 20 957. Sadly, the root cause is the extraordinarily high rate of road accidents in South Africa. So, make the roads safer and you’re half way there. However, until that happens, Whittaker recommends doing away with provisions for minor-injury claims.

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