Insurance premium query

Brawler

Brawler

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Hi.

My insurance premium keeps on going up but the value of my car is surely going down and I am no longer under 25 (so they can't use that excuse any more).

I am currently paying R1140 PM for my 2010 Kia Cerato 1.6. The car is parked in a locked garage at night (Rondebosch) and in access controlled parking lot during the day (UCT). I also have a tracker.

The car was just under R200k when I got it and was 24 years old so I think they raped me with the premium however as mentioned I am now well over 25 and the car is probably worth a hell of a lot less so why is my premium going up 10% per year? Only claimed for a new windshield (stone) and a passenger window (break in).

I just checked on Hippo and all the quotes were from R560 - 800 or so. Feel like I am being ripped off. Can I just call the insurer (Miway) and ask them to re look at my premium or I will go else where?
 
Brawler said:
Hi.

My insurance premium keeps on going up but the value of my car is surely going down and I am no longer under 25 (so they can't use that excuse any more).

I am currently paying R1140 PM for my 2010 Kia Cerato 1.6. The car is parked in a locked garage at night (Rondebosch) and in access controlled parking lot during the day (UCT). I also have a tracker.

The car was just under R200k when I got it and was 24 years old so I think they raped me with the premium however as mentioned I am now well over 25 and the car is probably worth a hell of a lot less so why is my premium going up 10% per year? Only claimed for a new windshield (stone) and a passenger window (break in).

I just checked on Hippo and all the quotes were from R560 - 800 or so. Feel like I am being ripped off. Can I just call the insurer (Miway) and ask them to re look at my premium or I will go else where?
Click to expand...

The older a car is the more expensive it is to repair when something breaks. That's it really.
 
Not all policies are equal though. Things to watch out for

1) Excess structure: % based or flat (%based excess results in a relatively lower premium but if your car gets stolen it could be a big amount)
2) Third party liability claims - if you flatten a dr in an accident who then tries to sue for loss of income - many policies limit this to R1m, others R5m and some R10m or unlimited - that can play a part

Although the car does lose value each year there are some offsetting factors which mostly more than offset it - although there should still be an allowance for it. The offsetting factors are

1) When your car gets damaged and needs replacement parts - the parts are new regardless of the age of your vehicle, these are constantly increasing at well above the so-called inflation rates.
-in fact getting parts for older cars may be most costly since sourcing them can be difficult
2) The labour cost for installing the parts is also increasing at crazy rates

The only time that the reduced value of your car makes a difference is for a total loss claim - whether its written off in an accident or stolen. However, by claim numbers this forms a small part of a typical insurers claims and so the benefit of that is more than offset by 1 and 2.

Having said that - yes phone Miway and get them to re-quote you - it could significantly reduce your premium. The process of re-rating an entire book of business which can be thousands of policies isn't done automatically though the pricing enginge typically. Applying something like a 10% annual increase accross the book is a simple adjustment. Re-looking up all your information (and doing a new ITC check which they need your permission for) is most complicated and time consuming. Doing that may lower your premium further costing the insurer... so you can see why it might not be done - it takes time, effort and loses the insurer money.
 
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Qwikslver said:
The older a car is the more expensive it is to repair when something breaks. That's it really.
Click to expand...

I've never read such rubbish in my life.

That's even apart from the fact that we're discussing one which is barely 2 years old.
 
Well it _can_ be more expensive to fix an older car. Not necessarily though.

The bigger influence in why it doesn't necessarily decrease is that its _not_ cheaper to fix an old car than it is to fix a new car.

Take a brand new BMW worth R500 000 and a 10 year old one worth R50 000. If the radiator is damaged in an accident and has to be replaced (assuming its the same radiator) it will cost the same to repair both and the radiator may be readily available locally.

However if the older model requires a different radiator and it is not readily available locally, the repair may require specifically importing one - actually making it more expensive to fix.

Damage claims such as these cumulatively add up to more than total loss claims from, theft, say.
Thats why the insurance on a R50k car wont be a 10th of the price of a R500 000 car.

Plus their policy admin expenses will be about the same which could be, say, R50 per policy regardless of the value of the car insured. Relatively thats more expensive when you insure a cheaper car
 
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Don't sign up with insurers that give cash back bonuses for not claiming and switch insurers every 2-3 years. Since no matter what you do they will increase your premiums every year and cite some excuse for the increase. The easiest way to drop your premium is to look for cheaper rates every couple years and then switch.
 
The range you were quoted sounds about right to me, I'd avoid the lower ones though like on budget high excess. The excess is normally more than high enough on normal budget. I'm with virgin money and they have no excess, just a minimum claim amount.
I'd say you are being ripped but insurers are like that, if you don't ask/shop around you don't get. I'd rather just move to a new insurer than try reduce the premium on the one you're currently on because that will generally only work once. ie. they think you should be paying 1100 then they give you a 30% "discount" to match the others and the next time they raise it and you complain they will tell you you are already on a 30% discount.
 
Qwikslver said:
Generally a new car doesn't break and old cars break more often.
Click to expand...

That has nothing to do with what you stated; you were referring to repairing them when they 'break'.

Maybe time to just reword or are you really sticking to your guns on this one?
 
Wikkels88 said:
Uhm BS!!



And please give me the number of the insurance company that will cover if my car just breaks down due to its age?
Click to expand...

Call your insurance company and ask them to reasses your premium. I do this every year and they always lower the premium (although some of this is offset by the annual increase).
 
fonoi said:
Call your insurance company and ask them to reasses your premium. I do this every year and they always lower the premium (although some of this is offset by the annual increase).
Click to expand...

Why you quoting me, I'm not the OP that asked the question:p
 
Lol that is pretty bad. I am 28 and paying R516 p/m on a 2011 R300K car. Granted I have never ever claimed.
Claims = you pay more!
 
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