There are well over 11 million registered vehicles in South Africa, excluding trailers and caravans. With only two-thirds insured1, you begin to realise that car insurance is an absolute necessity.2
Low car insurance premiums2
Some insurers offer true value and affordability too. However, not all insurers are equal. Just because you pay little for your car cover does not necessarily mean you have a bargain. What’s crucial is that you understand what the insurer is prepared to give you for that monthly premium. Do the disadvantages outweigh the advantages? The real test is when it comes to claiming time. That is when you see the true colours of the insurer. Look at insurers’ online reviews and how they rank against their peers, which could give you an idea about the quality of their service. You can find an insurer that is affordable and that offers world-class service.
So, when you are looking to buy car insurance, you need to ask a reputable insurer the following questions. You’ll get a good idea what kind of policy you would like to buy. In addition, you need to read the contract and understand all the words and terms used in car insurance policies. The insurer, by law, is obliged to explain.
First, do your homework2
When looking for a car insurer, go online and learn more about the large, reputable car insurance companies. Avoid some fly-by-night company that is offering you low premiums.
What is an excess?2,3
This is the amount that a motorist would have to pay when making a claim, irrespective of which party is to blame. For example, a company may be offering you a low premium, but may not know about the massive excess. That is all very well, but would you have that amount of cash available within a week or two when collecting your car from the panel beater? Alternatively, you can increase the premium and lower the excess. An excess also prevents customers from making small claims if the claim is less than the excess.
What is compulsory excess?3
Compulsory excess is what you must pay to the insurer. High compulsory excess usually applies to high-risk groups such as teenagers with little driving experience and to those who own expensive luxury cars.
How does voluntary excess differ?3
In this case, you can arrange what excess amount you can afford over and above the compulsory excess. The insurer then adjusts your premium accordingly.
Are there any penalties for claiming too early?2
If you claim during a period soon after you bought car insurance, your excess could be higher. It’s essential to find out by how much.
How long does it take for the insurer to settle a claim?2
As long as you’re paying your monthly premiums, all is quiet and well. It’s when you submit a claim that the tyre hits the road. After you have made a claim, it would be terrible to discover that it takes a very long time before the company settles your claim.
If another person drives my car, am I still covered?2
You need to specify to the insurer who may drive your insured car. The insurer then approves and adjusts the excess, depending on if the driver is a teenager or a 45-year-old. With car insurance, the higher the risk of a driver, the higher the premium.
The driver’s age matters2
This is important to the insurer. An inexperienced teenager driver poses a much greater risk to the insurer than someone who has had 30 years of driving.
What is the resale value and full retail value of a car?4
The resale value of a car is the amount you can expect to get when you sell it sometime in the future. The full retail value is the amount you would get for selling your car if you had bought it from a dealership. The retail value of your car, depending on its mileage and condition, adds up to the market value of your car
What’s the difference between third-party car insurance and comprehensive car insurance?5
Third-party car insurance only covers you against damage caused to a third party’s car, whereas comprehensive car insurance covers damage caused to your car and that of the third party. Third-party is usually a much more affordable type of car insurance because it covers less than comprehensive car insurance. Make sure you choose the type of car insurance that suits your wallet and needs.
Disclaimer
Car insurance is not straightforward, which allows this article to be only informative. If you want to buy car insurance, first obtain professional advice from a certified professional advisor.
Asking the right questions cannot be underestimated when buying car insurance. You’ll sit with the problem of not being able to claim, so it’s your responsibility to find out what you are paying for. Prime South Africa offers affordable comprehensive car insurance with fixed premiums* and reduce to zero excess*. Contact them and find out more. Ts and Cs apply.
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