What to Do When Your Insurance Claim Is Rejected in South Africa

South Africans insure almost everything that matters to them: cars, homes, phones, businesses, funerals, their own lives. The premium buys a promise that when the insured event happens, the insurer will pay. Sometimes the event happens, you claim, and the answer is no.

Many disputes are resolved at the appeal or ombudsman stage. Whether yours is resolved depends on what you do in the first few weeks. It is always advisable to act within the prescribed time limits, get the insurer's reasons and evidence in writing, and build your complaint so that it would stand up in court if it has to.

Why Was My Insurance Claim Rejected?

Most rejections rest on one of a handful of grounds:

An exclusion. The insurer says the loss happened in circumstances the policy excludes, such as alcohol, an unlicensed driver, an unroadworthy vehicle, or excluded use in motor vehicle insurance policies.
Non-disclosure or misrepresentation. The insurer says you failed to disclose, or misstated, something material when you took out the policy.
Breach of a policy condition. For example, late notification of the claim, failing to install a required security device, or failing to cooperate with the investigation.
Not covered. The insurer says the loss falls outside what the policy insures at all.
Quantum. The insurer accepts the claim but disputes how much it should pay.

The ground matters because it decides who must prove what. If the insurer relies on an exclusion or a breach of condition, the onus is on the insurer to prove it. You must prove that you had cover and that the loss falls within it. Many policyholders give up because they assume they must disprove the insurer's allegation. Usually, they do not.

Does My Insurer Have to Give Reasons for Rejecting My Claim?

Yes. Insurers are regulated by the Policyholder Protection Rules, made under the Short-term and Long-term Insurance Acts. Under these rules, a rejection must come in writing and must:

give the reasons for the decision;
tell you that you may challenge the decision with the insurer within a period of not less than 90 days after you receive the notice;
explain any time-bar clause in your policy, and what it means for you, in plain language; and
give you the details of the ombud you can complain to.

If your rejection letter is missing any of these, it is a point in your favour before the ombud.

How Long Do I Have to Dispute a Rejected Insurance Claim?

Most rejected claims are lost not on the merits, but on the calendar. When your insurer rejects a claim, the rejection letter must give you at least 90 days to appeal the decision with the insurer. If your short-term policy has a time-bar clause, it must allow you at least a further six months after those 90 days to serve summons. Your policy may give you longer, but never shorter. Where no valid time bar applies, the ordinary three-year prescription period under the Prescription Act 68 of 1969 governs.

One rule works in your favour. Once the ombudsman receives your complaint, both the time bar and prescription stop running until the complaint is withdrawn or finally decided (section 216 of the Financial Sector Regulation Act 9 of 2017).

Do not assume a court will excuse a missed deadline. The Constitutional Court in Barkhuizen v Napier 2007 (5) SA 323 (CC) held that time-bar clauses are enforceable if they are reasonable and fair to enforce in the circumstances.

Step 1: Get Your Policy Wording and Claims File

Before anyone argues your case, the documents must be in hand. These are:

the rejection letter and every letter or email from the insurer;
the policy schedule and the full policy wording (the underlying terms and conditions), not the brochure or summary;
your claim form and everything you submitted with it;
the claims file: the assessor's or investigator's report, statements taken from you and witnesses, and any recordings of calls, including the call in which the policy was sold if non-disclosure is alleged.

Insurers do not always release the claims file on a first request. Where a written request is refused, the Promotion of Access to Information Act 2 of 2000 provides a route to records held by a private body when they are needed to protect your rights.

Step 2: Appeal the Rejection With Your Insurer

The formal name for this step is making representations to the insurer, usually through its internal dispute resolution department. It is your first and best chance to have the decision reversed. It is also the first document the ombudsman, and later a court, will read.

Effective representations do not plead for reconsideration. They test the rejection against the policy:

What does the policy wording actually say?
What test was the insurer required to apply, and what test did it actually apply?
What has the insurer proved, and what has it merely assumed?
What evidence contradicts it?

The insurer must give its final decision in writing. Everything said at this stage stays on the record.

Step 3: Complain to the Insurance Ombudsman (NFO)

Since 1 March 2024, complaints against short-term (non-life) and long-term (life) insurers go to the National Financial Ombud Scheme. The NFO replaced the separate insurance, banking and credit ombuds. Many people still search for it as the insurance ombudsman or OSTI.

What you should know:

The insurer's internal process comes first. A complaint lodged before the insurer has had the chance to resolve it is treated as premature and sent back to the insurer.
The NFO applies the law. It considers the same legal principles a court would, including the policy wording and who bears the burden of proof, and it can also take fairness into account.
Monetary limits apply to some divisions. Life insurance complaints have no monetary limit. Non-life complaints are subject to limits that should be checked before lodging.
Lodging the complaint suspends the time limits. Section 216 of the Financial Sector Regulation Act suspends time-bar clauses and prescription from the date the complaint is received.
The right to go to court is preserved. Using the NFO does not take away the right to litigate if the outcome does not resolve the matter.

Step 4: Can You Sue Your Insurance Company?

Yes. Court is the final route, and sometimes the better first one after the internal appeal. Going straight to court may be the right choice where:

the claim exceeds the ombudsman's monetary limits;
the dispute turns on contested facts that need witnesses to be cross-examined;
the insurer alleges fraud or dishonesty;
there is an important legal question you want decided with binding effect.

The value of the claim decides which court. The procedure is formal and the costs are real, so an assessment of prospects comes first.

How to Write an Ombudsman Complaint That Holds Up in Court

Most policyholders treat the ombudsman complaint as a letter of complaint. That is a mistake. A complaint should be built so that, if it does not resolve the matter, it becomes the foundation of a court case rather than an obstacle to one. In practice this means:

Preserving the evidence from day one. Photographs, footage, documents, witness details, and a written account of events made while it is fresh.
Locking the insurer's grounds. Putting the insurer's stated reasons on record and holding it to them. Insurers sometimes shift grounds when the first one fails, and a clear record makes a late change visible and harder to justify.
Getting the claims file before arguing. Evidence that has not been seen cannot be rebutted.
Writing it as you would plead it. Accurate facts, every ground addressed, no loose concessions, and nothing inconsistent with what will later be said under oath.
Diarising the deadlines. The time bar, the suspension under section 216, and the date the clock restarts if the complaint is withdrawn or decided.

A complaint prepared this way often resolves the dispute on its own. Insurers assess risk, and a well-documented complaint showing that the insurer cannot discharge its onus changes that assessment.

Common Mistakes When Disputing a Rejected Insurance Claim

Making emotional arguments. This is the most common mistake we see in complaints policyholders have drafted themselves. Hardship, loyalty as a long-standing client and a sense of unfairness are real, but they do not reverse a rejection. An insurer is an entity bound by the policy it issued, and it must be reasoned with on the terms and conditions of that policy. The arguments that succeed identify the test the insurer was required to apply, show that it applied the wrong one or applied it wrongly, and anchor every point in the policy wording.
Missing the time bar while waiting for the insurer to come back to you. The dates run from the rejection letter.
Arguing without the policy wording. The brochure is not the contract.
Accepting the insurer's framing of the onus. You rarely have to prove a negative.
Complaining only by phone. Nothing said on a call is on the record unless it is confirmed in writing.
Giving fresh statements to the insurer after rejection without advice. They may be used to repair weaknesses in the insurer's case.
Treating the ombudsman complaint as a formality. It may be the most important document in the dispute. Concessions made in it can follow you into court.

When Should You Get an Attorney for a Rejected Insurance Claim?

Insurance products are sold on the back of policy wordings that are long, technical and often difficult for a lay person to follow. If you do not fully understand your policy wording, you should not be drafting the appeal or the ombudsman complaint yourself.

Understanding the policy is only part of it. A rejected claim is decided by how the policy is interpreted, and interpretation is governed by:

the Policyholder Protection Rules;
the rules of the ombud scheme;
the Insurance Acts and the Financial Sector Regulation Act;
the principles our courts apply to insurance contracts, including who bears the onus and how ambiguous clauses are read.

A complaint that misses any of these can concede the very point that would have won the claim. The time limits mean there is rarely a second chance.

Get advice before you respond to the rejection, and in particular where:

the claim is significant to you;
the insurer alleges dishonesty or non-disclosure;
the time bar is close;
the insurer will not release the claims file.

An attorney can also judge early whether court, rather than the ombudsman, is the better forum depending on the circumstances of your claim.

What to Do When Your Insurance Claim Is Rejected in South Africa