Motor insurance: the GFA calls for a cleaning up of the market

A video, signed GFA Insurance, is currently circulating on social networks. The freedom of choice regarding various transactions is highlighted.

Through this video, GFA Insurance informs the public about Section 81 of the Insurance Act. This stipulates that everyone is free to choose their insurance provider when purchasing a vehicle or carrying out a financial transaction with a bank or a leasing company. Forcing or manipulating a transaction by favoring a particular provider is an offense.

According to Abdel Ruhomutally, Managing Director of GFA Insurance, the law clearly states that the client must sign a document confirming that he has been given the choice. “We have been fighting this fight in the public interest for two decades. Recently, the Minister of Financial Services publicly committed to initiating an awareness campaign on the subject, under the aegis of the Financial Services Fund,” he underlines.

In the meantime, GFA Insurance is continuing the fight at its level. “Hundreds of people continue to be harmed in their rights without their being aware”, insists Abdel Ruhomutally.

The Managing Director of GFA Insurance has written officially to the Minister of Finance, asking him to intervene by proposing corrective measures during the 2022-23 Budget. “The commercial space is marred by persistent violations through collusive agreements. This is in clear violation of competition laws, Section 81 insurance, and fair business practices generally,” he wrote.

Requested release of original parts

Another proposal: the liberalization of original parts. Abdel Ruhomutally maintains that the importation of these parts remains the monopoly of dealers, who freely impose their prices, which are often prohibitive. “The liberalization of the trade in original spare parts will lead to lower prices while generating additional revenue for the State”, he argues.

It also calls on the Minister of Finance to look into the fact that new car dealers do not allow owners to use “small garages” for minor repairs, often under the threat of voiding the vehicle’s warranty. Such practices, he says, maintain the monopoly position while Mauritians end up paying dearly for a service that could have been available cheaper in an open market.

“It is time to establish a courageous transition from the current monopolistic situation to a free market where products and services become available at fair prices in the best interests of every Mauritian and/or entrepreneur,” he concludes.

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