How to save money on comprehensive car insurance in South Africa

Saving money on comprehensive car insurance in South Africa is a goal for many vehicle owners, especially since many South African motorists are still experiencing tough financial times, primarily due to the pandemic. According to a 2016 BusinessTech article, about two-thirds of all vehicles on South African roads have no insurance cover. Unlike many other countries, compulsory third-party car insurance has yet to be introduced in South Africa. Because of this, the need for South African motorists to get car insurance becomes even more pressing.¹

Insuring for market or retail value

You can save on monthly premiums by insuring your car based on its market or retail value. The market value of a car is the price a buyer is likely to pay, while the retail value of a car is the price is the average going price that dealerships would pay. This value can be influenced by a variety of factors, including supply and demand, economic conditions, and even the time of year.¹

Insuring for market or retail value

If your car is new and financed by a bank, South African law requires you to take out comprehensive car insurance. This cover is the best you can get for your car. But, if your car is old and paid up, you can save on premiums by insuring it for third-party car insurance or third-party fire and theft car insurance.¹

Improve the car’s security

Insurance is all about risk – the higher the risk, the higher the premium and vice versa. You can lower the risk and premium by installing a tracking device in your car. A lockable garage or a secure parking area could also reduce the risk and premium. Remember to inform the insurer once you have upgraded your car’s security so to apply for a lower premium.¹

Aim for continuity regarding your insurance history

An unbroken insurance history with an insurer works more in favour of the insurer lowering your premium compared to you cancelling a policy and then again re-joining the same insurer. This is because the insurer prefers a complete driver profile.¹

Provide all information

Some motorists may want to withhold some driver profile information from the insurer to secure a low premium. The problem with that approach is that the truth will come to light sooner or later, especially during claim time. Why take a chance of having the insurer reject a future costly claim?¹

Insurers are human

Sometimes we are tempted to treat car insurance companies as an item or a website. But humans run insurance companies. So, building a good relationship with a company is essential. This relationship becomes more robust over time and helps negotiate low premiums.¹

To be able to choose wisely, you need to know the difference between comprehensive car insurance and third-party car insurance.²

Comprehensive car insurance

In South Africa, comprehensive car insurance is typically considered to be the most comprehensive type of coverage available for car owners. Comprehensive car insurance is a type of insurance policy that provides financial protection for a wide range of potential damages to your car. In addition to the standard cover options, many car insurance providers in South Africa also offer additional benefits which can be added to your policy for an additional premium. As a South African motorist, you need to ensure that you have these types of benefits on your policy: 24-hour towing service, roadside assistance, and car hire.²

Prime South Africa’s comprehensive car insurance

Prime’s comprehensive car insurance covers you for damage caused by a motor vehicle accident and offers cover for write-off, theft and hijacking, and damage caused by natural fire and disaster. It provides third-party vehicle liability protection of up to R1 million per incident while covering your car for its retail value. Other benefits include 24-hour roadside assistance and towing and hail damage cover. Should you die in an accident, there is free R10,000 accidental death cover to help your family.³

Prime’s affordable third-party car insurance

This unique product, and its Growing Accident Cover, cover you for third-party claims. This Growing Cover benefit helps lessen repair costs or loss in the case of smaller accidents and can increase by up to 100% of the car’s trade value. Another great benefit includes third-party liability cover, with liability protection going up to R500,000 per incident. Hail damage cover is the last benefit, protecting your car from hail damage by up to R10,000.⁴

Disclaimer

This article aims to show how to save money on comprehensive car insurance in South Africa and describes the difference between it and third-party car insurance. ^1-4

Get professional advice from a certified financial advisor before purchasing a financial sales product.

Sources:

1. 1. 7 tips to help you save on your car insurance premiums
   2. What’s The Difference Between Comprehensive Car Insurance vs Third-Party Insurance?
   3. PMD’s comprehensive car insurance offers fixed premiums and reduce-to-zero excess!*
   4. Third-party car insurance that covers your car if you have an accident and also offers fixed premiums*.