Mistakes People Make When Comparing Insurance Quotes

Sadly, insurance is often viewed as a grudge purchase, and most people say that they just don’t have the money for it.  Unfortunately, things often happen that are largely out of our control – like a car accident – and it’s at these moments that we wish we’d spent time comparing quotes.

Another misperception in South Africa is the perceived mountain of administration when signing an insurance policy. Yes, you should be getting a few quotes, and comparing the options out there – but you don’t have to do it all yourself.

Using a comparison website will assist in finding the best insurance quote, make sure the site is independent, so it’s a true, honest look at the options available to you. But what pitfalls are there? What should you look out for? CompareGuru CEO Travys Wilkins has a few tips:

  1. Take time to read the fine print

Everybody is looking for the best possible deal, and in an ideal world, that would mean paying less money and receiving more cover. Unfortunately, insurance just doesn’t work that way. Too many consumers settle for the first offer they receive – or the cheapest quote – without comparing them at all, and knowing what you’re getting for your money. There are many insurance providers out there, and some of them may be really cheap for a reason.

You don’t want to put your most valuable assets at risk by acquiring inadequate cover. That’s the most important factor to consider – sufficient protection. Therefore, it’s important to shop around and weigh up your options. Know your policy, know what the limits are and know what you’re paying for.

      2. Don’t be dishonest

An insurance policy is essentially a legal agreement between two parties; the insured and the insurance company. This agreement is based on trust. You, as the policyholder trust the insurance provider to cover you accordingly in the event of damage or loss. In return, the insurance company trusts you to pay your premiums and furnish them with accurate, honest information from the onset.

Comparing Insurance Quotes

Questions like: Have you ever been involved in an accident? Are you married? Do you have children? Do you spend a lot of time on the road?  The quotation you receive from the insurer is based on this information.  Lying to your insurance provider will result in your claim being rejected, and you’ll have to pay for all the damage or loss out of your own pocket.

With that in mind, in the process of comparing quotes, it’s also important to provide all insurers with the exact same information. This is the only way to truly receive accurate quotes.

      3.  Lower premiums vs lower excess when comparing

Most people will opt for lower monthly premiums, but what they don’t always realise is that to get the same amount of cover, of the same value, you’ll then have to face higher excess fees when you claim.

It is often better to pay a higher premium every month and select a lower excess. The reason for this is simple; you can budget for monthly premiums. You know what you’re paying.

Accidents, however, come out of nowhere, they’re entirely unplanned, and there’s no certainty that you’ll be able to cover a large excess fee at that time.

In a nutshell, opting for lower premiums may save you money from month to month, but it will end up costing you far more in the long run.
So, you’ve gone through all the quotes as carefully as possible. You’ve chosen a reputable insurance company. The premiums are realistically affordable, and the policy covers everything you need it to cover. You’ve asked the questions you needed to ask and you know what you’re covered for, as well as your limitations. You’ve been entirely honest.

Now, breathe a sigh of relief. You’re one step away from protecting your assets.

All info was correct at time of publishing August 21, 2019