How to complain to the Ombudsman for Short-Term Insurance

If you are looking for the Ombudsman for Short-Term Insurance, that office no longer operates under that name. On 1 March 2024 it merged into the National Financial Ombud Scheme South Africa (the NFO), which now handles non-life insurance complaints alongside long-term insurance, banking and credit complaints. The service does the same job, it is still free to consumers, and you still do not need an attorney. Older letters, policy documents and websites may still refer you to the old office, so do not be confused if you see the old name. Our guide on what the National Financial Ombud does covers the whole scheme.

Before you lodge, you normally have to finish the insurer's own internal complaints process. And do not sit on it. The scheme's rules let it decline a complaint brought more than three years after you knew, or should have known, that you had cause to complain, and the time bar in your policy is usually far shorter than that. Lodge as soon as you have the insurer's final decision rather than waiting to see if it changes its mind.

What the ombud can deal with

Complaints against a short-term or non-life insurer, including:

• motor claims that were rejected, underpaid or delayed
• homeowner and household contents claims, including storm, fire, geyser and burst pipe disputes
• cellphone and portable possessions claims
• travel insurance disputes
• disputes about how the insurer applied average because you were under-insured
• disputes about excess, write-offs and the valuation of a total loss
• poor claims handling and unreasonable delay

What it cannot deal with

• Complaints about the advice you were given when the policy was sold, or about a broker's conduct. That goes to the FAIS Ombud.
• Medical scheme disputes, which go to the Council for Medical Schemes.
• Retirement fund disputes, which go to the Pension Funds Adjudicator.
• Matters already before a court, or matters that have already been decided by a court.
• Claims above the scheme's monetary limits. Under the rules at the time of writing these were R10 million for homeowners or buildings cover and R5 million for other non-life cover, unless the insurer agrees to exceed them or you agree to limit your claim. Check the current figures before you lodge.

Step one: exhaust the insurer's internal process

Write to the insurer's complaints or disputes department, not the call centre. Set out your policy number, claim number, the date of the loss, the date of the rejection or the underpayment, the reason the insurer gave in its own words, and why you say it is wrong. Attach your evidence. Ask for a final written decision.

Keep every email. The ombud will want to see that you gave the insurer a chance to fix it.

For the arguments that tend to work against the common rejection grounds, read My insurance claim was rejected. What can I do?, and our insurance claim rejection appeal letter gives you a structure for the internal dispute.

Step two: lodge with the ombud

You can lodge through the online complaint form on the NFO's website, by email or post, by telephone on 0860 800 900, or in person, and in any official language. A written complaint with documents is still the strongest way to do it.

Send a short covering summary and let the documents do the work. Include:

1. Your name, ID number, contact details and postal or email address.
2. The insurer's name, your policy number and the claim number.
3. The date of the loss and a short factual account of what happened.
4. The insurer's rejection or decision letter.
5. Your policy schedule and the wording that applied on the date of the loss.
6. Your written complaint to the insurer and the insurer's final response.
7. Supporting evidence: quotes, assessor reports, photographs, bank statements showing premiums were paid, repair invoices.
8. What outcome you want, stated in one or two lines.

Number your annexures. A file the case handler can follow is a file that moves.

A worked example

This example is illustrative. Pieter's geyser bursts and floods the ceiling and two bedrooms. His insurer pays for the geyser but rejects the resulting damage, saying the geyser had been leaking for some time and the damage was gradual deterioration, which the policy excludes. Our guide on claiming for burst pipe damage deals with that exclusion.

Pieter's repair quote for the ceilings, flooring and painting is R64 000. He writes to the insurer's disputes department, attaches the plumber's report stating that the geyser failed suddenly, photographs taken on the day, and the quote, and asks for a final decision. The insurer confirms the rejection. Pieter lodges with the National Financial Ombud Scheme the same week, with eight numbered annexures and a one line request: pay the resulting damage in terms of the policy.

The case handler puts the complaint to the insurer, which files its assessor's report. Pieter is asked to comment. The dispute comes down to whether the evidence shows a sudden event or a slow leak. Whether Pieter gets the full R64 000, a part of it or nothing depends on that evidence and the ombud's view of what is fair. What the example shows is the method: internal step first, then the ombud, then a tidy file that lets the case handler see the point in minutes.

What happens after you lodge

The scheme acknowledges the complaint, checks it falls within its mandate, and then puts it to the insurer for a response. There is usually an exchange of submissions. The case handler may ask you for more documents, and the process is largely on paper rather than in hearings.

Timelines vary with complexity. A straightforward motor claim can be resolved in a few months. A disputed fire claim with assessor reports on both sides takes longer. Many complaints are resolved by the insurer reconsidering once the ombud engages, which is a real outcome even though it does not feel like a ruling.

If the matter is not settled, the NFO first makes a recommendation and, if either side does not accept it, an ombud issues a ruling. It is not obliged to decide the way a court would. It decides what is equitable, fair and reasonable, having regard to the law, which is often an advantage to a consumer. If you accept a ruling, it binds the insurer, subject to the insurer's right to apply for leave to appeal to the scheme's appeal tribunal within 30 days. If you do not accept it, you are not bound and may take the dispute to court. The ombud can also award up to R50 000 for material inconvenience or distress caused by the insurer's poor service.

Realistic timeline

• Rejection to internal dispute: send your dispute within days. Most policies give around 90 days, but that is a limit, not a target.
• Insurer's final decision: typically a few weeks.
• Lodging with the ombud: the same week you receive the final decision.
• Acknowledgement and mandate check: usually quick.
• Exchange of submissions: a few weeks to a few months, depending on how quickly the insurer responds and whether further documents are needed.
• Outcome: a simple matter may resolve within a few months of lodging. A large or technical claim can take considerably longer.

What to do this week

1. Find the insurer's final written decision. If you only have a phone call, ask for the decision in writing today.
2. Diarise the period in your policy for issuing summons. It is commonly six months from the rejection, and it is suspended only from the day the NFO receives your complaint.
3. Put your evidence into a single folder, numbered, in date order.
4. Write a one page summary: what happened, what the insurer said, why it is wrong, what you want.
5. Lodge with the ombud. Do not wait for the insurer to change its mind.

Common mistakes and what they cost

• Lodging before finishing the internal process. The complaint is referred back and you lose weeks.
• Sending a long narrative and no documents. The case handler cannot assess a story. They can assess an assessor's report.
• Complaining about the broker's advice to the wrong ombud. That is a FAIS Ombud matter, and time is lost in the transfer.
• Lodging after the time bar has run. A complaint suspends the clock from the day it is received; it does not revive a period that has already expired.
• Repairing before the insurer's assessor has inspected. You lose the physical evidence of the cause.

Watch the six month clock in your policy

This is the trap. Most short-term policies say you have to issue summons within a limited period after the rejection, commonly six months. That contractual time bar is much shorter than the ordinary three year period under the Prescription Act 68 of 1969.

Lodging with the ombud does protect you, within limits. Section 216 of the Financial Sector Regulation Act 9 of 2017 and rule 6 of the NFO's rules provide that once the NFO receives a complaint, any time bar, whether in the policy or in law, and prescription under the Prescription Act are suspended until the complaint is withdrawn or finalised. Three cautions follow. The suspension starts only on the day the NFO receives the complaint, so time that ran before then is gone. It does not revive a period that had already expired. And the clock starts again as soon as the complaint is finalised, so if you reject the outcome you may have very little time left to sue. How long do I have to claim from an insurance company? explains the different clocks. If you are close to any of them, speak to an attorney; it is far cheaper to check than to find out afterwards that you are out of time.

Your rights and the insurer's rights

You have the right to: a written final decision with reasons; a free complaint to the ombud without an attorney; to see the insurer's response to your complaint and to reply to it; and to a determination that considers fairness, not only the strict wording.

The insurer has the right to: have the internal process completed first; put its own evidence and assessor's report before the ombud; rely on a valid exclusion or condition that was properly disclosed; object that a complaint falls outside the scheme's mandate or monetary limits; and apply for leave to appeal against a ruling.

Other free routes

• The Financial Sector Conduct Authority deals with regulatory misconduct by financial institutions, though it does not resolve individual claim disputes.
• The National Consumer Commission, for consumer complaints that fall under the Consumer Protection Act 68 of 2008 rather than a financial services complaint.
• Legal Aid South Africa on 0800 110 110, subject to a means test.

The insurers fund the ombud scheme, so it costs you nothing to use. For most policyholders it is the right first step, and it should be tried before anyone starts talking about court. Where a claim is large enough to justify an attorney, ask whether the firm charges hourly or will consider a contingency arrangement under the Contingency Fees Act 66 of 1997, and get the answer in writing.