Nedbank says people cancelling insurance after buying new cars caused headaches - so it solved the problem

Jan

Jan

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Big car insurance headache for South African banks

South African banks offering car financing can automatically add insurance premiums to monthly payments if customers fail to provide proof of vehicle cover timeously.

This is necessary because many people cancel their comprehensive car insurance cover soon after driving a vehicle off the showroom floor, contravening the terms of their agreement with the financing house or bank.
 
Hasn't it always been like this? I've been asked for proof of insurance at least 3 times over the last 8 or 9 years. And they clearly said in the communication that if you don't have they'll automatically load it for you.
 
I think it's pretty common. SA Homeloans even requests that u provide proof of insurance cover on your house annually if it's financed by them.
 
Very common; I had this with my last vehicle finance (Car is paid off now) and the bank asked every year to see proof.
 
Priapus said:
Very common; I had this with my last vehicle finance (Car is paid off now) and the bank asked every year to see proof.
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Yup all the cars I've owned over the last 12 years have had this request.
 
Jan said:
Big car insurance headache for South African banks

South African banks offering car financing can automatically add insurance premiums to monthly payments if customers fail to provide proof of vehicle cover timeously.

This is necessary because many people cancel their comprehensive car insurance cover soon after driving a vehicle off the showroom floor, contravening the terms of their agreement with the financing house or bank.
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But MFC, you would have required that same data at the start of the purchase process. You had it on file. Why can you not just confirm it with the insurer? Or just require the buyer to send you monthly insurance statements as they receive them?

Set up proper channels, set expectations early, none of this “oh now I want random info” nonsense. Banks should be able to do their own insurance queries, or should be able to pay insurance on behalf of clients. This arrangement is a bit ad-hoc.

What if the client fudged the proof?
 
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imas finance also asked for proof of insurance this month.
I assume it will become a yearly thing now?
 
werny said:
Should be enforced like in the UK, you actually have to drive around with the insurance documents if I remember correctly, if you cant show it then it's a massive fine and demerit points on your license.
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Technically it should be easy, but this being SA means it is practically unenforceable.
 
RedViking said:
Nedbank is a bit slow.
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I’m with MFC and have had a financed car for 3 years+ with them but was only required to produce proof of insurance once at time of purchase.

They must have some algorithm to decide who gets this letter and who doesn’t.
 
Insurance (at least 3rd party) should be mandatory and enforcement should be via camera and automatic inpounding of uninsured vehicles. This will doubly help with vehicle thefts and the premium will go down for everybody if third-party insurance was more common.

Not having insurance whilst financing I would consider fraud and there should be criminal prosecution.
 
Priapus said:
Very common; I had this with my last vehicle finance (Car is paid off now) and the bank asked every year to see proof.
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Seems uneven. My current car was financed by MFC (paid off). The only time I was asked for proof of insurance was when I purchased the car and never again.
 
werny said:
Should be enforced like in the UK, you actually have to drive around with the insurance documents if I remember correctly, if you cant show it then it's a massive fine and demerit points on your license.
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No insurance docs.
Every policy is loaded into a central registry. The police cars have ANPR cameras that query the DVLA (for road tax and MOT status) and the insurance registry automatically.

If your car flags negative on the registry they will pull you over and require you to produce proof. They will impound your car if you can't produce it.
6 points as well.
 
werny said:
Should be enforced like in the UK, you actually have to drive around with the insurance documents if I remember correctly, if you cant show it then it's a massive fine and demerit points on your license.
Click to expand...

This, times many. It should be compulsory for every single car on the road.
 
Johand said:
Insurance (at least 3rd party) should be mandatory and enforcement should be via camera and automatic inpounding of uninsured vehicles. This will doubly help with vehicle thefts and the premium will go down for everybody if third-party insurance was more common.

Not having insurance whilst financing I would consider fraud and there should be criminal prosecution.
Click to expand...
Craig_ said:
This, times many. It should be compulsory for every single car on the road.
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Having a drivers license and roadworthy car is compulsory... hows that going?

 
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