There Are Many Different Types of Car Insurance – Detailed Information Below
January 7, 2019
What is car insurance and what are the different types of car insurance?
Millions of cars take to the roads in South Africa every single day. Some of the cars never make it home after a drive. Some are involved in accidents, and some are hijacked. That is why there are different types of car insurance available.
Driving a car in the morning does not guarantee that one will park it his/her garage/yard in the evening.
We urge motorists to have car insurance to help them in case something happens. Apart from a house, a car can be the most valuable asset that a person can ever own.
What is car insurance?
A car insurance policy is a contract between a motorist or car owner with an insurance company. In the contract, the policyholder agrees to pay a fixed amount of money periodically known as a premium and the insurance company agrees to pay some money to the policyholder in case something bad happens to his/her car.
In South Africa, there are several car insurance companies. Some of the companies have been in existence for a long time while some were formed relatively recently.
Different types of car insurance in South Africa
There are three main types of car insurances in South Africa. These insurance types cover the needs of South African motorists and pedestrians.
We advise each prospective policyholder to fully understand the features of each insurance type before choosing his/her preferred insurance type. Each cover has its advantages and disadvantages.
The three types of insurance are comprehensive, third party only cover and third party, fire and theft insurance.
Third party only cover
Third party cover is the cheapest and most affordable insurance type and is unique in the sense that it does not offer any financial protection to the vehicle of the policyholder.
It only helps the policyholder if he/she damages the car of someone else. The third party only cover also pays off all the expenses associated with the death or personal injury of all people (known as third parties) involved in the car accident in which the policyholder is responsible.
The downside of this cover is that it does not cover the policyholder even if he/she suffers injuries and his/her car receives damage during the process of the incident.
Comprehensive car insurance
That is the most expensive cover because it covers the policyholder against theft, hijacking, accidental loss or damage, fires and natural disasters such as floods. It also covers the policyholder against third party claims in an accident in which the policyholder is at fault.
Third party, fire and theft insurance
The type of cover does not offer any financial protection to the policyholder for any accidental damage to his/her car. It covers a car that is damaged or lost through, fire, theft, and hijacking. It also covers the policyholder for any damage that he/she causes to the car of a third party.
If a policyholder damages his/her car in an accident, he/she has to use his/her money to fix the car.
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All info was correct at time of publishing