Mangle your insurance?

2010-06-12 14:00

Getting the right vehicle cover can save you from financial ruin,

especially now that more motorists are holding onto their cars for longer.

The right cover can save you money with lower premiums.

Insurance experts believe that underinsuring your vehicle may be

the best option because the value of your car depreciates ­every year.

But the Ombudsman for Short-Term Insurance, which ­investigates the

bulk of complaints ­relating to insurance ­disputes, advises consumers to seek

­opinion from insurance brokers before downgrading on existing policies.

Brian Martin, the ombudsman has observed that car owners are

increasingly keeping their cars for longer ­periods and downgrading from

comprehensive cover to third-party ­insurance.

Martin says fewer cars are now comprehensively insured.

This can mean that a driver who causes an accident might have

enough insurance to cover the ­repairs to the other vehicle, but not enough to

fix his or her own car.

Martin says: “Consumer ­education remains one of the biggest

challenges facing the ­industry.”

Standard Bank Insurance says it is wise to choose comprehensive

insurance for new and used vehicles.

Spokesperson Keith Watson, director for

strategy and business support, says comprehensive ­insurance covers damage to

­other people’s property, damage to your own vehicle and also ­covers


“It gives the widest protection, but it also means paying a higher

premium. The value of most cars ­decreases every year. So, the need for

comprehensive insurance may eventually fall away,” says Watson.

As the replacement value of the car decreases, consumers should

consider reviewing their cover to reflect this situation.

Watson says an older car may not represent a serious ­financial

loss if it is stolen or damaged.

However, an older car may ­cause damage to an expensive vehicle in

an accident.

The minimum cover protects a policyholder from legal liability for

other people’s property and their passengers.


Join the conversation! encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

We reserve editorial discretion to decide what will be published.
Read our comments policy for guidelines on contributions. publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Comments have been closed for this article.

Inside News24

Traffic Alerts
There are new stories on the homepage. Click here to see them.


Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.

Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire network.


Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.

Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.