What To Consider When Buying Car Insurance?

The saying goes, “The best things in life are free” – but we disagree. 

You earn the best things through hard work and budgeting – like a car.

Your vehicle represents every adventure you’ve ever faced, and it should go without saying that buying car insurance could be one of the best decisions you can make to secure your financial future. 

• Click here to get car insurance from Pineapple.

This is especially true if you’re a new driver, a first-time car owner, or both.

Factors to consider when looking for insurance

When searching for the best vehicle protection, there are three essential factors you should keep in mind: 

• Your needs
• Your lifestyle
• Your budget

Ndabenhle Junior Ngulube, Pineapple’s co-founder and CDO (Chief Development Officer), said, “The most important thing [about buying insurance] is to have complete knowledge and awareness of exactly what you are covered for versus what you are not covered for.”

Suppose you’re a first-time driver (or your vehicle is fresh off the dealership floor). In that case, your needs will likely centre around protecting your extensive investment into a new car against accidents or even a total write-off.

Newer cars typically have a higher retail value, so the financial blow of getting into an accident and not having sufficient cover would heavily affect your lifestyle.

Lastly, as a new vehicle owner, your budget can only stretch so far, so it is vital to do the necessary research to find the most affordable cover that ticks all your boxes.

Additional factors to consider when purchasing an insurance policy include:

• Quotes:

Notice the “s”? Shop around and get multiple quotes from different insurance providers directly. 

Don’t limit your search for the best insurance policy to comparison sites. 

Although they’re a valuable resource and an excellent place to start, not every insurer is represented in the lineup, meaning you might miss out on a good insurance option or a great deal.

While more time-consuming and somewhat tedious, you’ll find that answering the full roster of questions for more than two competitors might result in even more affordable prices than what was presented to you on an aggregator site. 

But, if you’d prefer to skip a lengthy insurance call, insurance providers like Pineapple offer 100% digital insurance solutions. 

• Premium Price:

Cheaper is not always better. By asking the right questions about hidden or additional excesses and benefits, you might find more to it than meets the eye. 

For example, if you’re looking for comprehensive coverage and there is no 24-hour roadside assistance, that’s a red flag. 

Another provider would include this as part of their offering, thus increasing the premium price slightly.

• Excess:

Are there different excesses that one can choose from? Can you afford to pay said excess when it’s time to claim? 

These are essential questions you should ask yourself when seeking car cover. 

Always check if the policy includes any hidden or additional excesses. This will help you assess whether you can afford them when you have to claim.

• Credit Shortfall:

If your vehicle is being financed, you may want to include credit shortfall in your policy when shopping for car insurance. 

Credit shortfall covers the amount owed to the bank (the vehicle’s insured retail value) versus the outstanding financed amount. 

For example, if your car is worth/insured for R100 000 and R150 000 is still owed to the financier due to the interest charged, should a write-off happen, your insurer will pay out the initial R100 000 to the financier, while you have to settle the remaining R50 000.

• Vehicle Pre-inspection:

The purpose of a pre-inspection is to verify the car’s condition before an insurer activates your policy. 

Most insurance providers will only cover you comprehensively after you complete this step. It helps them curb fraudulent claims, where a client may attempt to claim for pre-existing damage. 

Ensure you are up to speed with the provider’s requirements, which are typically communicated in your policy documents. 

Look out for any clauses relating to the pre-inspection; the insurer will either recommend a credible, preferred supplier or may advise that you perform the pre-inspection yourself using your smartphone. 

Digital insurance providers like Pineapple prefer the latter option to minimize inconvenience while encouraging policyholders to have complete control over their policies. 

Therefore, clients can perform a pre-inspection in the comfort of their own homes. 

• Claims:

When it comes to claiming, check for any cool-off periods—some insurers require a minimum amount of time insured before you can submit a claim. This is primarily the case where additional or hidden excesses do not apply.

Additionally, look out for exclusions surrounding insured drivers. 

For example, only the specified driver might be covered, meaning only the policyholder is insured, as opposed to the cover extending to their loved ones, spouse, or other family members. 

Not knowing this could jeopardize your claim.

• The fine print:

Read the fine print to know exactly what you’re buying–what is included in the policy and, most importantly, what is not. This ensures you’re aware of any shortfalls, helping you avoid disappointments at the claims stage.

• Reviews:

Research, research, RESEARCH! Review websites and other similar platforms are a great starting point. Google reviews, in particular, might offer a more accurate look into a business’s operations and how satisfied its customer base is. 

Google employs numerous methods to flag and remove suspicious and fraudulent reviews, namely checking for bots, duplicate content, and specific word patterns.

Furthermore, the platform also requires reviewers to be verified and only allows them to submit a single review per business and email address.

The different types of car insurance policies

Once you’ve researched and analyzed what you want from your car insurance policy, your next decision is determining which policy type suits your insurance needs best. 

In South Africa, car insurance policies generally come in three forms: 

1. Third-party
2. Third-party fire and theft
3. Comprehensive coverage

Third-party policies are available to protect yourself if you cause damage to another motorist’s property. 

Third-party fire and theft policies give your vehicle additional protection compared to the above. 

Comprehensive car insurance is all-encompassing; it covers you and the other parties if collisions happen between your vehicle and third parties. 

Comprehensive cover also protects you against unforeseen events like theft, weather damage, fires and accidental damage.  

Premium costs vary by insurer, and comprehensive coverage typically costs more than third-party coverage, but the additional coverage you get often makes it better value for money.

Finding the right car insurance provider

Your car insurance policy is only as good as the insurer providing the coverage. 

The right car insurance will offer affordable premiums while meeting all your requirements. (Remember your needs, budget, and lifestyle from before?) 

They should be more than a premium collector, too. Your insurer should be a trusted advisor who supports you at every turn, from providing hassle-free claims to offering excellent customer service. 

How to buy car insurance

As previously mentioned, the best way to make your life easier when searching for car insurance is to use comparative websites and review platforms. 

These valuable resources are where customers share their honest opinions and experiences with different insurance companies, providing an accurate view of each provider’s performance.

While on the topic, read about SA’s top-rated insurance provider here.

Alternatively, follow this simple checklist to assist young drivers with limited insurance knowledge.

Here are a few points to consider when buying car insurance as a South African motorist:

• Your car’s retail value and your ability to recover from a write-off. 
• Your risk profile, additional drivers and driving habits (distance travelled, location and time).
• The policy benefits, their usefulness to your driving experience (car hire, roadside assistance, key replacement, etc.), and possible discounts. 
• The total insurance cost (including the excess and the monthly premium fee).
• Research and compare: all-encompassing comprehensive cover versus basic third-party protection.
• Research and compare part 2: what is the insurer’s reputation, claims process and overall service?

Ultimately, the effort you put into picking the right insurance policy will likely affect your overall experience. That’s why it’s crucial to take the time to consider the above factors. 

Better yet, reach out to the insurers with your questions and concerns. 

The right one will answer each query with patience and transparency because that is the primary purpose of car insurance: to help you share the burden of protecting your valuables while offering you helpful support.

So, don’t settle for the first quote or the cheapest. Consider all the factors mentioned in this article to ensure peace of mind.

Please Note: The information provided above is for informational purposes only; you should not construe any such information as legal or financial advice. 

Click here to get car insurance from Pineapple.