Car Insurance
Budget Insurance has created a useful car insurance guide that outlines the fundamentals of auto insurance, including legal requirements, coverage options and terminology.
Is it mandatory to have car insurance?
No, car insurance is not a legal necessity in South Africa; rather, it is a personal decision for drivers. If you buy your automobile with a vehicle-finance arrangement, you may be obliged to obtain insurance.
The Automobile Association of South Africa states that there are approximately 11 million registered vehicles in the country, and up to 70% of those are uninsured. That means, on average, that only 3 out of every 10 cars on the road are insured. But that begs the question: If your car is involved in a vehicular collision, how confident are you that you’d be able to recover the cost of repairs from the other party?
Why even bother with taking out cover?
If it’s not a legal requirement to insure your car, why would you need to peruse a car insurance guide? Because car insurance is necessary for financial stability and financing.
Remember that if you do not have car insurance and are involved in an accident, such as colliding with another vehicle, item, or structure, you are fully liable for any damages. If you are found to be at blame for destroying a third party’s car or property, you may be required to pay them.
Because most people cannot afford to repair their vehicles out of pocket, it’s advisable to safeguard yourself by taking out a car insurance policy and paying its monthly premiums on time. That way, you will be covered financially for a covered event, depending on the type of insurance plan you’ve taken out.
Additionally, if you owe money on your automobile, it is recommended that you obtain car insurance since, even if you lose the vehicle completely (due to theft or an accident), you will still be required to repay your loan. When you buy a vehicle through a bank, you are usually required to acquire comprehensive auto insurance.
How much is Car Insurance?
The cost of car insurance is multifaceted. An insurance company evaluates each application based on various factors, including age, driving history, parking location, vehicle type, geographical location, and driving time.
Furthermore, there are many types of automobile insurance plans, each with a different monthly rate dependent on the coverage provided.
Requirements for car insurance
Applying for a car insurance quote is simple and easy. You will need to supply the following information:
- Personal information: such as your age, address, ID number, and contact details
- Vehicle information: such as the make, model, year, and VIN number, as well as the registration details attesting to ownership
- Driving history: you might be asked for details about your driving history, such as collisions or insurance claims
- Coverage preferences: you will be asked to choose the type of auto insurance you want and the extent of coverage
- Payment information: a way to pay for your insurance premium.
What does Car Insurance cover?
Your coverage will depend on the type of insurance you take out. Your most common options include:
- Comprehensive Car Insurance covers loss, theft, and damage to your own car. It also covers fire damage and damage to a 3rd party’s property or vehicle, even if you’re the cause of an accident.
- Third Party, Fire and Theft Car Insurance – this covers theft and fire damage to your car and any 3rd-party damage you may cause in an accident.
- Third-Party Only Car Insurance will only cover damage to a 3rd party’s vehicle or property that results from an accident in which you are deemed to be at fault.
Certain insurers, like Budget Insurance, additionally provide a number of add-on insurance plans in case you have identified particular risks that you would need additional coverage for. Additionally, you can get a cashback credit if you don’t make any claims for two years. Therefore, you may depend on these auto add-on insurance to handle any small scuffs if you want to keep your record “clean.” Some of the policies include:
- Motor Warranty: Vehicles and their parts do not last forever. With a Pre-owned or Extended Motor Warranty, you’re covered for mechanical and electrical problems when your manufacturer’s warranty expires.
- Scratch & Dent Cover: You can take care of those small (but annoying) scratches, scrapes, dents, and chips on the body of your car without having to claim on your primary car insurance policy.
- Tyre & Rim Guard: To replace a tyre or fix a rim after you’ve hit a pothole or debris on the road.
- Auto Top-Up: If your car is stolen or written off, your payout may not fully cover what you owe on your financed car. Auto Top-Up pays the difference.
Want to know more about car insurance?
We hope our guide about car insurance has been useful to you. Remember that Budget Insurance’s staff is always available to help if you would like to check your auto insurance requirements with professionals or learn more about auto insurance. You may acquire a precise and affordable quotation in a matter of minutes by calling 086 1600 120 or using their online car insurance calculator.
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