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Cheap Car insurance

We all want cheaper insurance. Though it is a necessity, most people tend to view their monthly premium as a grudge payment. Insurance companies across the board use the lure of cheaper premiums very effectively in marketing campaigns; in certain cases even offering to pay out an agreed sum of money should they not be able to provide you with a cheaper quote.

But what exactly is cheaper insurance? A cheap monthly premium is not the only consideration to keep in mind. An insurance policy is, in essence, a legal document, and the document in its entirety has to be reviewed thoroughly in order to ascertain the cost effectiveness of your insurance.

A starting point would be to confirm that the policy you select is fit for purpose and covers your insurable interest (for instance, if you are the only person driving your car, there is no reason to have a policy permitting more than one driver).

In addition, the following can be considered:

 

Excess

This is where most people lose with their vehicle insurance. The amount of excess you will pay in the eventuality of a claim is directly proportionate to the cost of your monthly premium. As an example (using very simplified figures):

Sandra pays a monthly premium of R100 towards comprehensively insuring her car, a late model sedan. She is covered for the full retail value of her vehicle should it be stolen. Her excess is 15% of the claim with a minimum payment of R5, 000.

Dan pays a monthly premium of R150 for the exact same vehicle. He is also covered for the full retail value of the vehicle, but his excess in such an eventuality is only 5% of the claim, minimum R2, 500.00.

Assuming that the model of car in question has a retail value of R100, 000.00, Sandra will only get a settlement of R85, 000.00, whilst Dan will get a payout of R95, 000.00.

In addition to the basic excess explained above, additional excesses should also be taken into consideration. The full description of excesses will always appear in your policy. You can use this schedule of excesses to help you determine whether your cheap car insurance is really as cheap as claimed.

 

Policy Wording and Inclusions/Exclusions

The way in which your policy is worded along with the specific inclusions, exclusions and conditions pertaining to your insured vehicle also plays a huge part in ascertaining how affordable your car insurance is.

Let’s continue with Sandra as an example and assume that she has lodged a claim for a stolen vehicle. Sandra bought her car with a factory-fitted alarm, but never installed a VESA-approved gear lock, which her policy stipulates as a security requirement. Because of this policy condition, her claim might be repudiated. This means that her “cheap insurance” potentially ended up amounting to “no insurance”.

Dan, for instance, might have installed an expensive sound system in his car, never realizing that additions such as those are excluded in his policy. He might have his claim settled for the retail amount of the vehicle minus the excess, but he will incur a loss with the sound system.

On the other hand, specific inclusions might make the insurance policy more worth-while.

 

Enticers (or Policy Sweeteners)

Policy sweeteners are terms and conditions in your policy with the specific purpose of making it more attractive.

An example of a policy sweetener might be that you will pay no excess (or greatly reduced excess) should you lodge a windscreen claim. Or that an extra driver can be added to your car insurance policy without affecting the monthly premium.

These are always worthwhile  to consider when looking at getting the cheapest car insurance.

Shopping around for insurance quotations can be a real pain in the proverbial backside. In fact, collectively we have such a perceived adversity to it that many online quote comparison companies have sprung up to capitalise on this, and by and large they are quite successful. Using these companies, like the very well-known Hippo, can provide an excellent starting point for your hunt for the perfect vehicle insurance cover. However, it is always advisable to shop around more and see exactly what is on offer in the market before making any hasty decisions.

We have compiled the following 5-step plan to make it easier for you to get the best deal possible when shopping around for car insurance:

Step 1: Find Out What Your Vehicle’s Value Isshop-for-car-insurance

This is something many people never think about. In the event that your vehicle is stolen, your insurance company will base their settlement on the retail value of the vehicle. Say, for instance, you have a vehicle that is worth R50, 000.00, yet you have insured it for R70, 000.00. Should the vehicle be stolen, your claim will not be worth more than R50, 000.00 (before deductions of excesses). This situation is called being over-insured.

Many people in South Africa have over-insured vehicles without being aware of it. You can easily find out the retail value of your vehicle by phoning a car dealer and asking them to look it up for you on the Mead and McGrouther system (also known as the “Blue Book”).

Step 2: Look At Your Current Insurance Policy

Take a good look at your current insurance policy, if you have one. Note what it covers and what it excludes. Remember to also note the excesses you have to pay in the event of a claim. Calculate your monthly and your yearly contributions towards the policy, as the quotes you get can be presented in either form.

Once you have those amounts, you have a price to beat and can continue to the next step.

Step 3: Start Shopping

As mentioned above, start with the car insurance quote comparison websites. They provide you with a wide variety of quotations in exchange for very little input. But do not stop there.

Get on the phone and speak to major insurers one on one. You can often bargain better in this fashion, and should be able to negotiate much better rates. Remember to ask the consultant to fax or email your quotation to you as a confirmation of the rates given to you telephonically.

Step 4: Choose, Request, Read

By now you should have a big pack of quotes. Choose a couple that seem reasonable in their pricing, but also include some that you know for a fact are from reputable insurers, even if they are a bit more pricey.

Contact the insurers you chose and indicate that you are potentially interested in making use of their services. Ask them to send you policy schedules.

Once you have received all the policy schedules, sit and read carefully through each and every one. Look out for high excesses, underinsured rates and exclusions. Also pay particular attention to the minimum security requirements your vehicle should adhere to in order for a claim to pay out. This tends to differ immensely from policy to policy.

Step 5: Look At Extras

Consider including extras in your policy, like receiving a courtesy vehicle should yours be stolen or badly damaged in an accident. These options usually only work out to a couple of hundred rand a year extra and are for the most part worth it.

Step 6: Make Your Final Choice

Based on all of the above, decide which policy both meets your financial needs and offers the best package in return.

Going about shopping for insurance in this manner could save you a lot of money, as well as educate you properly as to exactly how much you are covered for and for which eventualities.

 

It is one of the most discussed topics amongst South Africans. The state of the fuel price and fuel-saving practices have long been able to spark an entire conversation.

Tips on lowering your vehicle’s fuel consumption are numerous and every relative, friend or general acquaintance seems to have a couple of them stowed away, ready to deliver at their earliest convenience.

But have we ever taken the time to consider whether these fuel saving tips are actually true? This article serves to prove that many, if not most of them, are no more than fairy-tales.

A Dirty Air Filter Leads to Increased Fuel Consumptionfuel-consumption

This belief is true for some cars and totally false for most. The vast majority of vehicles on the road today have fuel-injected rather than carburetted engines. Carburetted engines draw air directly through the air filter, and a clogged filter could affect the performance and fuel consumption of the vehicle. Fuel-injected engines, however, have complicated air-intake systems that are not affected in the slightest by a dirty air filter.

You Get More Fuel If You Fill Up When It Is Cooler

This is a very well-known myth that periodically does the rounds in the form of a chain email. The story goes that one should fill up your tank at the coolest part of the day, namely the very early morning hours, as the heat absorbed by the petrol tanks at filling stations during the day cause the fuel’s density to drop, thus you get less when filling up during daylight hours. The reality of the matter is that the large underground holding tanks at fuel stations are very thoroughly insulated to prevent this scenario from occurring. Any fluctuations in the fuel temperatures are so miniscule that you will not be able to notice any appreciable differences in fuel savings.

Vehicles With Manual Transmissions Get Better Mileage

Decades ago, cars typically came with two options pertaining to the transmission: a 5-speed manual gearbox or a 3-speed automatic one. As a semi-skilled driver could control the engine’s revolutions per minute with a 5-speed manual transmission, one tended to save a lot of fuel by staying away from automatic vehicles. These days, however, automatic transmissions are control by sophisticated computers and are a lot more efficient than any manual human operator could ever be.

Lowering a Bakkie’s Tailgate Increases Fuel Economy

People have often assumed that a bakkie with its tailgate lowered is more aerodynamic, and thus less taxing on its fuel supply. The reverse is actually true: your bakkie is less fuel efficient with the tailgate down. Another common assumption is that replacing the tailgate with an aftermarket net makes the vehicle more efficient. This is the worst thing you can do, as it is tantamount to a boat pulling a fishing net behind it.

Other Untrue Fuel Consumption Myths

  • Overfilling your fuel tanks helps mileage;
  • Fuel additives increase mileage;
  • Cruise control saves fuel;
  • A tank that is nearly full prevents evaporation of fuel;
  • Shifting into neutral at stops saves fuel.

 

Fuel Economy Musts

The following tips actually do work, and should be implemented by every driver that wishes to save fuel:

  • Slow down – you can use up to 25% more fuel if you drive at 120km/h as opposed to 100km/h;
  • Avoid breakneck acceleration;
  • Keep your momentum and try to anticipate the traffic;
  • Maintain and regularly service your vehicle;
  • Try to not use the air conditioner;
  • Use your handbrake on inclines – clutch control gobbles up fuel;
  • Do not warm your engine up before driving – this is usually only necessary in older vehicles and is wholly unnecessary in newer vehicles;
  • All electronic components put a strain on the alternator, causing the engine to work harder, so switch of the unnecessary ones;
  • Plan to combine many short trips into one;
  • Consider replacing your tyres with the radial-ply kind as they decrease resistance, but beware to not mix the normal cross-ply with radial-ply tyres on the same axle.

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