Road Accident Fund Pays R3.3 Billion in Major Claims Clearance Drive – October 2025 Update

RAF Makes Historic R3.3 Billion Payment to Clear Claims Backlog

The South African Road Accident Fund (RAF) has made significant progress in addressing its massive claims backlog, paying out R3.3 billion in just two weeks as part of an aggressive new strategy to clear outstanding claims. This development marks a crucial turning point for the embattled fund, which has been struggling with over R20 billion in outstanding claims older than 180 days.

New Leadership Drives Transformation

The breakthrough comes under the leadership of the new interim RAF board, appointed by Transport Minister Barbara Creecy in August 2025 after she dissolved the previous board due to governance failures. Kenneth Brown, a former National Treasury executive and current Development Bank of Southern Africa board member, chairs the interim board and has promised an “aggressive” approach to settling long-overdue claims.

The interim board’s appointment followed years of mismanagement that left the RAF with liabilities exceeding assets by R27.7 billion by March 2025. The fund, primarily funded through fuel levies, has faced chronic underfunding and operational challenges that created a massive backlog of unpaid claims.

Court Ruling Forces Immediate Action

The RAF’s recent payment surge was triggered by a High Court ruling in September 2025 that dismissed the fund’s application to extend its 180-day payment moratorium. Judge Jabulani Nyathi struck the application from the court roll, citing lack of urgency, which meant the RAF had to revert to paying claims within 14 calendar days instead of having up to six months.

This court decision created immediate pressure on the RAF, which had been using the moratorium to manage cash flow and avoid potential insolvency. The fund faced particular challenges with 41 default judgments in May 2025 alone due to its failure to oppose claims in court.

Strategic Overhaul and Future Plans

The interim board has implemented several key changes to address the crisis:

• Comprehensive Claims Review: All claims outstanding beyond 180 days have been reviewed with clear prioritization for settlement
• Enhanced Monitoring Systems: Strengthened tracking of both paid and outstanding claims to ensure accountability and transparency
• Streamlined Documentation: New controls to ensure supporting documentation is reviewed promptly, avoiding administrative delays
• Regular Reporting: Bi-monthly reports will be issued to plaintiff attorneys and made publicly available
• Direct Engagement Protocols: Systems in place to resolve disputes and clarify non-compliant claims

Monthly Payment Targets Set

The RAF board expects to maintain monthly payments exceeding R4 billion throughout the year, which they describe as “the new norm” under their revised business model. This aggressive payment schedule is designed to substantially reduce the claims backlog in the coming months.

“The board is acutely aware of the financial and emotional strain that delayed payments have caused for claimants and their families,” the interim board stated. “We reaffirm our responsibility to resolve this matter with urgency and transparency.”

Industry Response and Stakeholder Engagement

The new approach has been developed through extensive consultation with stakeholders, including attorney associations, sheriffs, and service providers. Following the High Court ruling, Brown convened urgent meetings with legal professionals to discuss the implications and develop sustainable solutions.

Medical schemes have also been advocating for faster settlements, with the Hospital Association of South Africa representing 20 medical schemes calling on Parliament to order the RAF to settle claims valued at more than R2.3 billion.

Ongoing Challenges and Corruption Concerns

Despite the positive developments, the RAF continues to face significant challenges. Recent news has highlighted issues with attorney misconduct, including cases where legal representatives have stolen client payouts, leading to claims against the Fidelity Guarantee Fund.

The Standing Committee on Public Accounts (SCOPA) has also announced inquiries into alleged corruption between judges and lawyers in RAF cases, indicating that systemic issues extend beyond just payment delays.

Financial Sustainability Questions

While the RAF maintains it can meet its obligations over the next 12 months, questions remain about long-term sustainability. The fund had R10.4 billion in unpaid claims at the end of March 2025 and a total claims liability of R40.4 billion.

Some industry observers have suggested that National Treasury should provide a bailout to clear all outstanding claims immediately, then recover the funds from monthly levy income to avoid accumulating interest costs.

Looking Ahead

The interim board’s modernization efforts extend beyond immediate payment issues. Brown has indicated plans to overhaul the entire RAF claims system, moving away from litigation-heavy processes toward more efficient claims management.

“We can’t have people who are being paid big money and they are just not doing their work,” Brown stated, emphasizing the board’s commitment to accountability and performance.

Impact on Claimants

For the thousands of South Africans waiting for RAF payouts, these developments offer hope after years of delays. The fund provides crucial compensation for road accident victims, covering medical expenses, loss of income, and other damages resulting from motor vehicle accidents.

The new payment schedule prioritizes claims older than 180 days, which should provide relief to claimants who have been waiting the longest for their settlements.

Conclusion

The RAF’s recent R3.3 billion payout represents a significant step toward addressing South Africa’s road accident compensation crisis. Under new leadership and with court pressure forcing action, the fund appears committed to clearing its massive backlog and implementing sustainable systems for the future.

However, the success of these efforts will ultimately be measured by the RAF’s ability to maintain its aggressive payment schedule while addressing underlying governance and operational issues that created the crisis in the first place.

Stay updated on the latest RAF developments and South African financial news by following our regular coverage of this evolving story.