5 ways that SA’s new motor code will benefit car owners

  • Potentially lower insurance premiums

It’s not just the end-consumer who will have more choice‚ but insurance companies as well.

The Competition Commission says that “insurers may appoint and consumers may choose to appoint ISPs (independent service providers) to undertake non-structural work on motor vehicles during the warranty period.”

The code goes on to say that a consumer’s warranty won’t be voided if an insurance company decides to go with an independent service provider for non-structural work on your car.

This should benefit insurers by giving them access to a wider pool of high-quality parts at lower cost‚ possibly resulting in lower premiums.

The code further encourages insurers to “offer consumers a choice of approved repairers within their geographic area from which they can select to repair their motor vehicles”

  • Much greater transparency

Another key stated objective of the new code is to “increase transparency and facilitate consumer choice in relation to the service‚ maintenance‚ mechanical and motor-body repairs of vehicles”.

For example‚ the code states that “consumers must be advised‚ in clear and explicit terms‚ that they are not compelled to conduct motor-body repairs only at approved dealers or approved service providers.”

Because consumers will be more aware of the details of their choices‚ the spin-off will be that manufacturers and independent service providers will increasingly have to disclose information and pricing of their offerings to secure business from the car owner.

  • Transformation and a more inclusive industry

Finally‚ but most importantly‚ the code seeks to drive the transformation of the industry by levelling the playing field.

It will do this by pushing for Original Equipment Manufacturers (OEMs) to “promote the entry of historically disadvantaged individuals (HDIs) into an OEM’s network of service and maintenance service providers.”

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