Many people find the insurance aspect of securing their vehicle against theft, loss or damage overwhelming as there are so many variations of cover and costs available.  “Without the financial experience of what insurance is all about, a D-I-Y approach is challenging when trying to figure out why the quotes you receive vary so radically in premium price, what’s covered and more crucially what is not covered, what the terms and conditions of the cover are, if any exclusions exist and why, and how much your excess will be – the cash sum you are liable for upfront if and when you need to claim,” explains Mandy Barrett of insurance brokerage Aon South Africa.  

It’s one of the reasons why getting independent and impartial advice from a professional broker is the very best financial decision you can make to ensure that your car and any extras are properly insured, and that you won’t face any nasty surprises should you need to claim.  “The true value of broker really comes to bear when you have a complex claim or a dispute with an insurer,” says Mandy.  “A professional broker will intervene on your behalf to handle the claims negotiations and ensure you get a fair settlement.”

Aon provides some invaluable tips that will help you when assessing your motor insurance:  

• Do the insurance research before you buy a vehicle

This may affect your choice of vehicle in the end when one looks at things like affordability, service costs, parts availability, required security measures and crime stats.  There are so many aspects that affect your motor insurance, ranging from the make and model of the vehicle, through to the cost of parts and availability, whether you need car hire in the event of an accident, what the vehicle is utilised for, your driver profile and age and even your credit rating.  Be aware of the type of security precautions you will need, such as a tracking device as you need to factor the ongoing subscription cost into your monthly expenses.  With all this to consider, it can be a minefield trying to navigate the terms of your motor insurance agreement without the insights of an experienced eye. 

• Personal Liability

Besides the obvious cover for accident damage and theft, your motor insurance also provides you with personal liability protection which is embedded in your policy. Personal liability is like having an umbrella on a cloudy day. You might not need it, but in a sudden heavy downpour, you’ll be grateful you have it.  This cover protects you against a third party suing you in your personal capacity for financial loss, physical injury or death. 

In the event of an accident, a passenger or any other party affected by the accident could sue you for negligence or intent, and here the legal defence costs and settlement could run into millions of Rands. Although the Road Accident Fund (RAF) exists for people injured in a road accident and is the typical route many people will take, the fund has certain limitations.  There is nothing stopping a third party from coming after you for compensation, especially where they can prove trauma or emotional shock (not covered under the RAF) as a result of witnessing an accident where someone was killed or severely injured, and you were party to it.

• Don’t assume you are covered for everything

Certain events are not always automatically covered on a standard motor vehicle insurance agreement to bring down costs, and such covers may need to be purchased at an additional premium – typically items such as scratch and dent cover, tyre cover, hail damage cover and so on.  Finding out that hail cover was excluded on your policy after a Gauteng hailstorm has done a swiss-cheese number on your car can prove financially devastating.    

Likewise, remember to specify any add-ons to your vehicle that are not standard features on the vehicle such as alloy mag wheels or a specific sound system, nudge bars and side steps, a GPS navigator and additional lights.  These all add additional value to the vehicle and need to be accounted for in your sum insured. If they are not specified, they won’t be covered.

“You really want to know and understand the detail of what you are covered for before claims time.  This is why when it comes to shopping for insurance, there’s really no beating the help and guidance of a professional insurance broker by your side to protect your best interests, point out all the important aspects of your cover, ringfence any exclusions or conditions and highlight what the general market trends are.  It’s unlikely to be the most riveting thing you’ve done, but getting a handle on your risks and how your insurance cover will respond in a claims scenario is likely to be one of the most financially important exercises you’ll do this year,” concludes Mandy.