Major used car change approved for South Africa

The South African Insurance Association (SAIA) will formally open its Vehicle Salvage Database (VSD) to the public in a move that will help stop previously written-off and poorly repaired vehicles from re-entering the used market, it said in a statement on Thursday (31 March).

However, the association said considerable work is still required to understand and mitigate risks before public access can go live.

The VSD system contains information on salvage vehicles. These are vehicles that have been deregistered by the respective insurers and thus declared salvage after policyholders have been indemnified of their motor claims.

A vehicle is considered salvage by the non-life insurance industry if it is ‘written-off’ following, for instance, a motor accident. The insurer would have assessed the damaged vehicle including the repair costs. If the motor assessor deems the cost of repairs to be uneconomical to repair, the vehicle would then be declared a ‘write-off’.

When a written-off vehicle is sold, the respective code is disclosed to the buyer. In this, the non-life insurance industry ensures that the relevant stakeholders who buy the salvage vehicle are fully informed of the state of the vehicle being sold, and therefore how the respective vehicle should be treated going forward.

For instance, a ‘Code 4’ is a permanently demolished vehicle.

“The board’s decision that further investigation of the inherent risks is required was made after considerable deliberations,” said Viviene Pearson, SAIA chief executive.

“Recent events have highlighted the need to consider risks associated with data security and potential misuse of information on the VSD. SAIA also wants users of the database to have a clear understanding of both its benefits and its limitations.”

Potential users of the VSD should also be aware that access to information is not guaranteed to be a complete solution to fraudulent behaviour, said Pearson.

“In particular, the VSD contains information only about insured vehicles. The vast majority of vehicles on the road are not insured, so the usefulness of SAIA’s database will be limited,”.

The primary reason the VSD system database was created was to combat crime. SAIA has previously warned that if the database is made public, against the Protection of Personal Information Act, it then allows criminals to have access to the entire non-life insurance industry database of scrapped vehicle VINs.

If this were to happen, both the banking industry and the non-life insurance industry would see a dramatic increase in false financing and insurance of cloned vehicles, it said.


Read: New extension for driving licences in South Africa – what you should know

Must Read

Partner Content

Show comments

Trending Now

Follow Us

Major used car change approved for South Africa