Oct 17, 2025 SAMBRA, South African Motor Body Repairers’ Association, Juan Hanekom,
SAMBRA raises concerns over “cash in lieu” trend for vehicle repairs
As economic pressures tighten, the South African Motor Body Repairers Association (SAMBRA), has noted a growing trend among vehicle owners choosing to accept upfront cash settlements from their insurers rather than paying the required excess and using an accredited repairer. Juan Hanekom, national director of SAMBRA, explains that the industry term for this practice is “cash in lieu” - when insurers settle claims by offering a monetary payout instead of authorising proper repair or replacement of damaged parts. Although not yet widespread, Hanekom says it is gaining traction among motorists who may not fully understand the potential risks.
“Essentially, this payment absolves the insurer from any further liability and leaves the consumer exposed if problems arise later,” he cautions. While the offer of immediate cash may appear attractive, especially for those struggling to cover their excess, it can definitely leave consumers vulnerable in several ways:
1. Under-compensation: The payout offered by insurers may not fully cover the actual cost of quality repairs or replacement parts, often being calculated on a net rather than full replacement part and labour cost.
2. Vehicle safety risks: Using sub-standard repair processes can compromise the structural integrity and safety of the vehicle.
3. Resale and warranty implications: Vehicles repaired without manufacturer-approved parts may lose resale value, and warranties could be voided.
4. Claims complications: Consumers may face lengthy disputes if the settlement proves insufficient to cover the necessary repair costs.
“SAMBRA believes consumers should be fully informed about the implications of accepting a cash-in-lieu settlement,” says Hanekom. “While insurers may see it as a cost-saving measure, the real cost can fall on the vehicle owner in the form of safety concerns, diminished value, and inferior workmanship.” Hanekom notes that, with the rising cost of vehicle parts, motorists should always do their homework before agreeing to a cash settlement. “It’s essential to get a comprehensive quote from a professional, accredited repairer to understand the true cost of repairs.”
SAMBRA advises motorists to:
• Confirm that the cash offer accurately reflects the full cost of the repair or quality replacement part.
• Understand any waiver of rights or exclusions linked to the payment.
• Get all agreements in writing, including any potential impact on warranties, future claims, or liability.
“Your car is more than just a means of transport — it’s a significant investment,” concludes Hanekom. “When accidents happen, it’s always wiser to prioritise proper repairs over quick cash payouts to ensure safety, quality, and long-term value.”
SAMBRA is a proud association of the Retail Motor Industry Organisation (RMI).
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