What is insurance?
Insurance is a mechanism that involves the reduction or minimisation of loss, owing to risk.
It can be regarded as a contract between an insurer and an insured individual, whereby the insurer undertakes to render to the insured a sum of money, or its equivalent, on the occurrence of a specified uncertain event in which the insured has some interest. The insured pays a premium to the insurer for these services.
As a car owner you need to make sure that you get insurance for your car to protect you from the risk of theft, fire, damage caused by an accident or a third party.
In South Africa, consumers are given the choice of three types of insurance cover, including:
- Comprehensive car insurance
- Third Party, Fire and Theft
- Third Party only
What you need to know about Comprehensive Car Insurance:
This is the most extensive type of insurance because it covers pretty much everything in the event of an accident, theft or fire. Depending on your chosen policy, you may also get cover for vandalism, riot, natural disasters and other weather conditions such as hail, floods, strong winds, tsunamis and earthquakes. You can also claim from your insurer for accidents that are deemed to be your fault. When claiming you will be obliged by your insurer to pay for compulsory excess if you are the one that caused the accident.
If you are buying a new car and you are financing it through a bank or another financial institution, you will be required to get comprehensive car insurance.
When searching for Comprehensive Car Insurance you need to make sure that you choose the best insurance company.
Benefits offered by Comprehensive Car insurance:
- Some policies include wear and tear cover
- You get cover for all incidents
- While your car is in for repairs you may get a courtesy car