Is vehicle insurance a legal requirement in South Africa?

    Is car insurance a legal requirement in South Africa?

    • There exists no legal requirement for South Africans to insure their vehicles
    • Driving without insurance is foolhardy
    • There are about eight million uninsured vehicles on our roads
    • Government has still to impose legislation enforcing vehicle insurance
    • South Africa lags hopelessly behind the rest of the world

     

    Alarmingly, South Africa’s cavalier approach to vehicle insurance has had a huge impact on the number of uninsured vehicles on our roads.

    No Legal Requirement – Yet

    In terms of current legislation, it is not illegal to drive an uninsured vehicle on South African roads. This tends to make financially insecure motorists to opt out of insuring their vehicles, leading to the current situation where more than 65% of the vehicles on our roads have no cover at all.

    This fact has been reinforced by the South African Insurance Association (SAIA) that recently released statistics showing Is Car Insurance a Legal Requirement in South Africathat only about 35% of vehicles on South African roads are insured.

    By the end of February 2017, there were more than 12 million registered vehicles on South African roads. This equates to about eight million uninsured vehicles. More than a third of registered vehicles are in Gauteng, then the Western Cape and KwaZulu-Natal.

    This does not include unregistered vehicles being illegally driven and adding to the risk of an increasing accident rate. There are no statistics on how many illegal vehicles are on South Africa’s roads.

    Debate About Legality

    Over the years there has been much debate about this situation. Despite government postulations to impose stricter vehicle insurance regulations, to date, nothing has happened.

    South Africa lags hopelessly behind when compared to other countries. In America, England, Indonesia and Norway vehicles must have comprehensive cover, while most other international countries insist on a minimum of third party insurance. This legislation ensures that other motorists are have cover in the event of an accident.

    However, while it may not be illegal, it is an extremely foolhardy decision to drive without insurance. Although cancelling vehicle insurance may seem the logical solution to save on monthly overheads, not having cover poses huge financial risks in the event of an accident.

    Conclusion About Legal Requirement

    In South Africa, motorists must have comprehensive insurance for a financed vehicle. They can cancel their insurance once they have paid for the vehicle.

    However, as the country’s political woes add to the spiralling rate of inflation, interest rates and exorbitant fuel prices, motorists should think twice before considering the option of no vehicle cover. The risk of being uninsured can be extremely costly in the event of a road accident.

    Insurance companies point out that replacement and spare parts are on a continual upward spiral, while towing a damaged vehicle to a repair shop can cost a staggering R20 000. Motorists should consider insurance premiums as a priority motoring overhead.

    According to economic data recently released, 75% plus of all household income services debt. It is no wonder, then, that South Africans will overlook the importance of vehicle insurance as a way to cut back on monthly costs. However, despite the lack of legislation to enforce insurance on all motorists using our roads, the financial implications of no cover in the event of an accident far outstrips a decision to cut back on this motoring cost.

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