• South African panel beaters, spray painters and motor body repairers are revolting against delayed payments from insurers.
  • The country's biggest industry organisation has adopted a "pay before release" policy.
  • You will only get your vehicle once your insurer has paid all bills - otherwise you will have to cough up.
  • For more stories, go to Business Insider SA.

For a long time, many South African panel beaters, spray painters and motor body repairers have complained that they are struggling with outstanding payments from insurers, who are supposed to fund repairs to policyholders’ vehicles.

Now the South African Motor Body Repairers’ Association (SAMBRA), which represents almost 1,000 businesses and accounts for more than 80% of all repair work funded by insurance claims, has decided to adopt a “pay before release” policy.

This means that you will only receive your vehicle once all payments have been made. And if your insurer hasn’t paid up, you will be liable for the amount if you want your car.

SAMBRA says this will protect businesses against “insurer failure and poor payment administration”.

They are specifically disgruntled about the failings of insurance brokers. These brokers act on behalf of large insurers to authorise claims.

“The motor body repair industry accepts these authorisations and completes the work before any payment is received, based on the historic trust-based relationships with Insurer business partners,” says Richard Green, National Director of SAMBRA.

Read: These are South Africa's worst insurers, measured by client complaints

But businesses are increasingly taking strain as they are not being paid for authorised work.

Green says the industry has lobbied with insurance bodies to help address the problem. “However to date there have been no effective suggestions and/or actions taken by the insurance sector and this has left the MBRs with no choice but to introduce Pay Before Release.”

Green says hopefully the impact on consumers will be minimal.

“Consumers need to be aware of the situation and realise they could remain liable for their vehicle repairs if their insurer does not settle their claim. They will be required to sign a check-in document at vehicle hand-over which contractually binds the vehicle owner to the full outstanding invoice in the event that the insurer does not pay the SAMBRA member,” he says. 

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