It’s a proud moment to be able to buy a car for yourself and your family. But there is so much that goes into making this big financial decision. Insurance, of course, is a big part of it. Before you leave the dealership or collect your dream second-hand car from a Gumtree Lead, ensure you have the right insurance policy that safeguards and protects you. You must also remember that it is illegal in most countries to drive without the minimum coverage in place.
Different car insurance providers offer different car insurance packages. Be sure to check and compare the benefits stipulated in the car insurance policy before signing the agreement.
So, how do you choose the right insurance policy when buying your dream car? It is important to first understand the three main types of car insurance policies in South Africa.
- Comprehensive Car Insurance
- This generally covers damages caused in a collision or accident, as well as damages caused by other factors, not within your control, including theft, hijacking, fire, explosions and natural disasters.
- Comprehensive insurance generally covers damages incurred to third parties in the event of an accident.
- This is the most expensive type of car insurance as it offers the most protection.
- Comprehensive insurance is a requirement if you are financing the payment on your car.
- This is the most suitable for new and expensive cars that clock up high mileage.
- Third-Party Fire and Theft OR Limited Liability Car Insurance
- This generally covers damages incurred to third parties and includes vehicle damage, accidental death and injury caused in the event of an accident.
- Third-Party Fire and Theft cover losses due to hijacking or theft and may also cover losses caused by fire, lightning or explosion.
- Your car, however, is not insured for damages incurred in the event of an accident.
- Third-Party Fire and Theft car insurance is suitable for cars that are almost paid off and clock up average mileage.
- Third-Party Only
- Third-Party only insurance covers damages incurred to third parties in the event of an accident.
- This policy does not cover damages to your car, theft, hijacking or natural disasters.
- Third-Party only insurance is the most affordable type of motorcar insurance.
- Third-Party only insurance is most suitable for old cars that clock up low mileage.
Use our tips below to choose the perfect insurance for your vehicle:
- Understand regulations: Consider what the law of your province/country requires you to abide by in terms of insurance and ensure you at least get the minimum.
- Scout for quotes: Do not rush in and buy the first insurance policy you are presented with. Do your due diligence and get multiple quotes or use an online insurance comparison tool.
- Read reviews: Read up on reviews and articles of various insurance companies to familiarise yourself with their processes and issues, if any.