In South Africa, the most common type of short-term insurance taken out is car insurance. More claims are made on this type of insurance, than any other type in South Africa.
There are only a select few people who buy a new vehicle for cash nowadays. More people are buying their cars by paying them off over a number of years. When you consider the various risks that come with getting a new car, you have no choice but to get insurance.
If you buy a new car the financial institution which is financing your vehicle is likely to insist that you get Comprehensive car Insurance cover. Various other risks you will be covering yourself against include loss, damage, theft, robbery, accidents and mechanical or electrical fault. By getting car insurance cover you can avoid a financial disaster.
In South Africa, there are an estimated 10 million cars on the roads, but only about 35% of these cars are insured. Poor maintenance of South Africa’s road infrastructure is also often a major influencing factor in the decision to get new car insurance. Add to this the high crime rate in the country as well as numerous potholes on the country’s roads, and you have more than a few reasons to get car insurance.
What types of car insurance can you get?
Comprehensive Car Insurance:
This is cover against the loss of the vehicle or damage to it, which happens as a result of an accident. You will be covered if the vehicle is stolen or hijacked or if anybody makes a claim against you for damage to their property as a result of a motor accident in which your vehicle is involved.
Third Party, Fire and Theft Cover:
This is a less expensive policy and provides cover for fire or theft or if a third party alleges a claim against you as a result of your negligent driving.
Third Party Only:
This cover protects you only against claims which other people may make against you arising from the use of your motor vehicle.