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Know Your Car Insurance Rights

It is important to know your car insurance rights before you accept an insurance policy. Car insurance can be difficult to understand for most drivers, especially first-time vehicle owners. Doing your research into car insurance laws in South Africa before purchasing the insurance policy is a smart move to make. For most, knowing that they have car insurance is enough. While this may be a good thing, understanding your rights as a policyholder makes all the difference when it comes to getting the best insurance coverage for your money. What are some of the laws concerning car insurance and what car insurance rules should you know? Let’s find out.

Is Car Insurance Legally Required In South Africa?

Having car insurance in South Africa is not required by law. However, if a vehicle is purchased with a loan from a financial institution or a bank, car insurance then becomes mandatory by the relevant financial institution or bank. It is a necessary expense in light of the number of accidents that happen on our roads yearly, not to mention the high level of crimes such as car theft. Here are the three types of car insurance options available to vehicle owners and the rules that accompany them.

Three main types of Car Insurance in South Africa

  • Third-Party Car Insurance: This type of car insurance is one of the cheapest, but offers lesser cover. Third-party car insurance only covers the damages done to another vehicle. You may be saving on monthly premiums but having to fork out thousands in damages because of inadequate insurance coverage will surely drive you up the wall.
  • Limited Car Insurance: Limited car insurance provides insurance coverage against third-party claims and for loss or damage as a result of fire, theft and hijacking. However, it is important to note that you will not be covered for damages should you be involved in an accident. It is also considered a cheaper car insurance option, but is the insurance cover adequate for the time you live in and the roads you navigate?
  • Comprehensive Car Insurance: This is the most extensive car insurance insisted upon by financial institutions and banks when your vehicle is purchased with a loan. Regardless of how you may have purchased your wheels, comprehensive car insurance is a necessity and not a luxury. Although more expensive than the other two types of car insurance, comprehensive car insurance covers you in the event of damage, theft, accidents, and more. Third-party claims are included in this cover as well. Depending on your insurer and the make and model of your vehicle, you may have to pay higher excess in the event of hijacking, theft, or fire. Know your car insurance rights by thoroughly reading through your policy schedule and becoming familiar with your cover and exclusions.

Car Insurance Is Not A Substitute For Life Or Medical Insurance

It is also important to note that car insurance covers your vehicle and not you as a person. This simply means that damages to the car will be paid for by the insurance. Any other financial obligations outside of your insurance policy must be covered by you.

Car Insurance Exclusions

The general exclusions on a car insurance policy include maintenance and wear and tear of your vehicle. While some insurers provide cover outside of the country, it is always wise to discuss this with your preferred insurer as it may or may not be an exclusion.

Medical insurance will ensure that your medical bills are taken care of should you need them.

Legal insurance will assist you with legal fees if one of your claims has to follow a legal route.

Breakdown Assistance may or may not be included as part and parcel of your car insurance policy schedule. Breakdown assistance insurance will pay for unplanned tow truck assistance when you need it most or at a time when you may be strapped for cash and low on lifelines.

Conducting your own research on car insurance law in South Africa by familiarising yourself with the applicable legislation will greatly enhance your understanding of car insurance laws and how they are regulated to protect you financially.

Chat with one of our representatives to gain a thorough understanding of car insurance rules in South Africa. Sharpen your insurance knowledge and live your way today!

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