The current pandemic has wreaked financial havoc amongst many South Africans. Some households that have constrained budgets could be tempted to cut their car insurance. We will examine some possible reasons why you shouldn’t cancel your car insurance in 2021.
Cancelling car insurance is not the answer 1,2
Cancelling your car insurance to decrease your budget could have long-term financial implications.
We need to be reminded of all the risks 2
We need to look at the bigger picture: South African motorists may not be able to afford to have an accident without any cover. Even though you are hardly using your car, just a short trip to the shops could prove to be a disaster. It is not about promoting fear, but about the harsh reality that no matter how well we drive, there can be that one motorist who is negligent. Also, only about 30% of South African motorists have car insurance, therefore, it is highly likely that should you be involved in an accident where someone crashed into you, they might be uninsured and won’t be able to cover your damages.
Speak to your current insurer 1
Before cancelling your current insurance policy, contact your current insurer to discuss the possibility of cheaper options available on offer that could work for you.
Downgrading from comprehensive car insurance 1,5
You could potentially downgrade to another product with a lower premium if you don’t use your car very often. This seems appealing to many motorists working from home. You could also downgrade to third-party car insurance, which provides cover if you accidentally damage someone else’s car.
Increasing your excess 1,5
Increasing your excess could lower your premiums, but make sure you can afford to pay the higher excess amount should you have an accident.
Disclaimer
Car insurance is complicated, and that is why this article only supplies information. If you want to obtain car insurance, you need to contact a certified, financial advisor for professional advice.
Are you looking to buy affordable car insurance? Perhaps contact Prime South Africa about affordable car insurance with unique benefits like fixed premiums.* T and Cs apply.
Sources:
- Here’s why you shouldn’t cancel your car insurance
- Don’t cancel your car insurance, even if you aren’t driving – here’s why
- Third-Party Car Insurances: 70% of Cars in South Africa are Not Insured
- https://citizen.co.za/news/south-africa/1943673/drivers-licences-one-in-three-illegal-due-to-scam/
- Car Insurance
