FAQ about car insurance in South Africa

Car insurance can be confusing at times – what’s the difference between the retail value and market value? Do I need comprehensive car insurance? In this post, we will look at the answers to these questions and a few more that you might be wondering about. Hence this FAQ article

How do Comprehensive and Limited Car Insurance Differ?

There are two really basic forms of car insurance we describe in this FAQ article.

  • Limited Car Insurance: This is the cheaper of the two and covers you if someone steals or destroys your car . It will also cover the damages to the other person’s vehicle if you are in an accident. You have to pay for your own repairs. It’s called Third Party insurance. There is also basic Third Party, Fire and Theft cover.
  • Comprehensive Car Insurance: Comprehensive cover means that you have full insurance if something goes wrong. The insurance company pays for your car repairs and so are the other person’s. If someone steals your car, you also have full cover.


Can I Insure an Older Car?

FAQ About Vehicle Cover in South AfricaThis will depend on the age of the vehicle. Some companies put limits on the age of the vehicle that they will insure. You will also usually only be able to get insurance for the market value, and not the replacement value.

You might also have to take out limited insurance, our FAQ advise.

How Are the Retail and Market Price Different?

The retail price is what you buy the car for. The market price is what you would typically get when you sell your car or the “book” value. There can be quite a discrepancy between the two, FAQ adds.

What Do They Mean by Excess?

Insurance companies don’t want you to claim for every little thing that goes wrong so they usually impose an excess. What this means is that you will have to pay any claims that are less than the excess.

Can I Save Money With a Higher Excess?

Many companies allow you to set a higher excess amount and so reduce your monthly installments. This can save you money on a monthly basis but you have to work out what excess you can comfortably afford.

The premiums for someone with an excess of R5 000, for example, are a lot lower than someone with an excess of R1 000. But that is not going to do you any good if you need to claim and cannot afford the extra R4 000 at the time.

Always consider your excess in terms of the amount that you could comfortably lay your hands on if necessary.

What is a Claimable Event?

This will differ from policy to policy so it is really important to establish this upfront. This is an event where you may make a claim. So, for example, if your car gets stolen, that is usually a claimable event.

These are just some of the generally asked questions about car insurance. There is still quite a bit more to go over, but these answers should at least get you started.

When it comes to car insurance, the best approach is to check the terms and conditions before you sign. Boring, I know, but if you have any questions, you need them answered upfront.


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All info was correct at time of publishing March 1, 2018