Why Is Car Insurance So Expensive – South Africa

car insurance

Car insurance is one of the most important and responsible things you can have as a car owner. But for many people living month to month, the cost is not something that they can afford. This often leads to car owners cancelling their insurance, which can cause even more costs if something terrible were to happen. 

Even if you do your research and search for cheap car insurance quotes in South Africa, you may still be highly surprised at the premiums you are given. We’ve compiled frequently asked questions that would answer the everlasting question, “Why is my car insurance so high?

Why Is My Car Insurance So High?

There are many reasons why car insurance prices fluctuate, and some of them may even be out of your control.

Why Is Insurance So Expensive in South Africa?

In most countries, having at least third-party car insurance is a legal obligation, but this is not the case in South Africa. More and more motorists are taking to the streets with no coverage on their cars. You might think that this would be a financial nightmare in the case of an accident, and you’d be correct.

According to statistics, up to 70% of all cars on South African roads are uninsured, and there are at least 800 000 accidents on the roads each year. This means that you are at higher risk of getting into an accident with someone who has no car insurance. In this case, the driver would be forced to cover the bill out of pocket.

Uninsured drivers spike up the cost of insurance policies for every car owner due to the high risk they pose.

Why Is My Car Insurance Quote So High?

There are many things that a company looks for when determining a car insurance quote. They are usually very diligent when creating a personalised quote, and luckily some of these are within your control.

Your driving history is one factor that influences your car insurance quote. Insurance companies need a full evaluation of your driving history. This includes the length of time you’ve had your license, any accidents you’ve been a part of, and even parking tickets.

Your car is another factor. The car you choose to buy will have a huge impact on the price of your insurance premium. A car that is considered practical will lower your payment amount when compared to another car that might be considered sporty and unique.

Your car might be considered high risk, which will also amp up the monthly premium. With so many cars getting stolen every year, South Africa has compiled a list of the most frequently stolen cars. If your car falls into this category, your premium might be higher than you’d want.

Finally, your location contributes to the quoted amount. When determining your quote, your insurance company will certainly look into your locations and the location of the car. The demographic of the area, accidents and hijacking rates, and even weather patterns play a role.

One way to appease your insurance company is to have your vehicle locked securely, either outdoors or in secured parking. This will lower the risk of theft and break-ins.

Why Is Full Coverage So Expensive?

Full coverage car insurance is notoriously expensive. This premium also gets calculated based on different factors. But, you might be wondering why your premium is still so high even though you have clean records.

Why Is My Car Insurance So High With a Clean Record?

It may seem very strange when you receive an astronomical insurance quote even though you’ve kept your side clean. Though having a clean driving record may help your coverage, it’s still a common misconception that your record will save you. Here are a few things that also determine your insurance premium.

Your age. Young drivers are considered to be less experienced and more likely to be involved in a road accident. They are often seen as high-risk drivers, and therefore have a higher premium.

Your gender and marital status. Young, unmarried men often receive higher premiums due to the idea that they are more reckless than their female counterparts. Married and experienced individuals are seen as more responsible, therefore they have better premiums.

You’ve had insurance cancelled in the past. If you’ve failed to make payments in the past or failed to produce documentation, the insurance company might drop you as a client. This will mean that you have no insurance and pose a risk on the road. This will have a negative impact when you try to obtain new insurance coverage in the future.

Your credit record is weak. If you have a less than clean credit history, the insurance company will make you pay for it. They look for patterns of unreliability and records against you which will in turn, pose a high risk in the company themselves. You might be seen as a high-risk client.

You might have a history of claims. This might seem counterintuitive, but an insurance company will flag you as a high-risk client when you have a history of big claims. If you’ve been in a few accidents, a bigger payout amount will negatively impact your premium.

My Car Insurance Is Too Expensive – How To Shop For Insurance

Before you get stuck into looking for a more affordable insurance premium, there are a few things you need to keep in mind. Here’s a small checklist of questions you can ask yourself before turning down the more expensive insurance option.

  • Will the insurance company cover my car even if someone else drives it?
  • Is the excess amount at a flat rate?
  • Does the insurance company offer benefits such as roadside assistance?
  • How does my insurance company compare to others?

Final Thoughts on Why Car Insurance Is Too Expensive

Car insurance is grossly underrated by South African motorists. We advise that you research the current market for the best price and coverage before you take the dive and settle with a company.

The most important part is that the vehicle is adequately insured in case of an accident.

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