Nowadays, you can’t flip between your favourite TV channels or radio stations without landing on an advert about cheap car insurance. Most insurers seem to focus on their low premiums and cost-effective offering. But cheap isn’t always cheerful. Behind that attractively low monthly figure, lies a much greater lump sum called excess. The less you pay every month, the more you’ll fork out in the event of an accident or theft. If you’re thinking about buying a new car, or you’re not 100% happy with your current broker, consider the following before you scour the internet for car insurance quotes. Here’s a scary statistic: The Automobile Association of South Africa recently reported that more than 65% of cars on the road are uninsured. Yikes!

Premium vs. Excess

The amount you pay, once a claim has been paid out by your insurer, is referred to as excess. Remember that even if an accident is not your fault, you might initially be liable to pay excess. Be mindful of this when choosing a broker. Cheap car insurance sounds great – until you’re required to pay a hefty lump sum. Weigh up all the pros and cons when it comes to your premium.

Insurance with benefits
Some insurers offer a bonus if you don’t claim over a set period, while others give you cash back or other value-added services. Consider what’s important to you before signing on the dotted line. See what each potential car insurance broker offers, and how these benefits relate to your lifestyle. You might definitely need comprehensive car hire, if your vehicle is in for repairs. Then make sure that’s included in your policy.

Do your research
Whether it’s by word of mouth, search engine or a comparative site – like Deals on Tap – you should take a look at what’s out there before committing to an insurer. Getting car insurance quotes can be painful, but you’ll be glad you did your research later on. There’s a wealth of information at your fingertips.

Risk and restrictions

Paying a premium doesn’t mean that you’re guaranteed to get paid out when you claim. Read through your car insurance policy to get a thorough understanding of what is, and isn’t included. Your broker might insist that you get a tracking device fitted to the vehicle. Or perhaps there are penalties in place for young drivers. Is the policy restricted to a named driver? These things are important and should be considered.

The next time you see an ad for cheap car insurance, take a moment to consider these factors. While you may feel that it’s easy jumping between brokers, it’s also unnecessary and time consuming. You can find the right car insurance to suit your lifestyle, first time.

Car insurance and motor warranties are two different creatures, but both are necessary when driving in the urban jungle

Vehicles are not considered to be investments because of their relatively short life-spans and the many ways in which they can be damaged, but with sufficient car insurance and a suitable motor warranty, you can ensure that your four-wheeled baby maintains its optimum value. Before you owned your car, you might have imagined car ownership as something like the slicked-hair-combing, pelvis-thrusting, Pink Ladies-dating John Travolta with his Grease Lightning. Unfortunately, car ownership in real life involves far more paperwork and diligent planning than the movies would have us believe. Between potholes, taxis, drivers playing Candy Crush on their way to work, and just plain bad luck, there is never a time that you don’t need both car insurance and a motor warranty every time you drive out your garage.

Car insurance is a service you pay an insurance company to offset the expenses should you be involved in an unfortunate event in which your vehicle is damaged or written off. Three types of car insurance are available in South Africa – Comprehensive, Third Party, Fire and Theft, and Third Party. Comprehensive insurance, as its name suggests, covers most accidental damages sustained to your vehicle caused by yourself or someone else. It includes cover for damage caused by natural disasters (like floods), as well as third party cover, meaning it covers the costs when you’re responsible for damage caused to someone else’s vehicle, property or person. Comprehensive insurance also covers loss of a vehicle as a result of theft or hijacking. Third Party, Fire and Theft insurance offers insurance for only these three conditions – third party cover for when you are responsible for damage to someone else; fire or natural disasters; and theft. Significantly, this type of insurance does not cover you for accidental damage to your car in the form of a car accident or your own “preventable” actions when operating your vehicle. Finally is Third Party insurance, which covers only the damage that you cause to someone else. Any of these circumstances are at best inconvenient and unpleasant, and car insurance can help ease the financial woes that they bring.

A motor warranty, on the other hand, covers expenses that arise when parts of your vehicle malfunction. Car parts are designed for a specific function and with the intention of lasting for a certain time-frame without undue stress or forces acting on them. This means that if a part stops working through no fault of your own or without the intervention of an outside force (such as an attempted theft or natural disaster), the warranty acts as a guarantee that the parts will be repaired or replaced based on the specific value of the part and its age. The mechanical and electrical integrity of today’s cars are fundamental in their safety and longevity, but because perfection is unfortunately unattainable, motor warranties help protect you as a consumer from malfunctions.

Despite what car commercials and music videos would have us believe, vehicles are unfortunately a liability, rather than an asset. However, instead of comparing car insurance versus motor warranties, they should be seen as services that go hand-in-hand to promote the lifespan, value and safety of your vehicle. A motor warranty can ensure that your vehicle operates at its optimum, which in turn can help prevent accidents. But because of the uncertainties of life, car insurance ensures that even in the case of an accident, you, your car, and your wallet can be protected. So just like Danny and Sandy, car insurance and motor warranty go together like “ramma lamma lamma ka dinga da dinga dong.”

Are you thinking about buying a used car? Or perhaps you’ve already bought one and are feeling a bit unsure about its mechanical or electrical state. Did you know that you can extend the motor warranty of any used vehicle by buying an extended car warranty?

Most used car dealers will offer a short motor warranty – SA warranties are usually 30 days or 2,000 kilometers (whichever comes first). Really cheap vehicles are sold cash as they stand (voetstoots), and will come with no motor warranty.

An extended car warranty is an insurance product that’s developed to protect your car against mechanical or electrical failure, after the manufacturer’s warranty has expired.

In South Africa, you’re able to select an extended car warranty provider that can offer you a number of product options. These options have different levels of warranty at different prices – giving you greater cover when you need to claim.

How much does an extended car warranty cost?

Let’s consider, for example, you’re interested in buying a used Toyota Corolla 1.6. The vehicle is 2 to 4 years old, with between 40,000 and 80,000 kilometers on the clock. It also has a full service history.

For a used vehicle with this profile, you can expect to pay between R126 and R277 per month for an extended motor warranty from a reputable insurance company.

Some of the important components that should be covered are:

Most insurance companies should also include handy benefits like:

Your level of cover increases as you pay more for the motor warranty. It can also decrease a potential shortfall if you discover that it will cost more to repair or replace an item. Many SA warranties also offer additional benefits like medical evacuation from an accident or road side assistance.

What are the benefits of an extended car warranty?

• Peace of mind: Your vehicle can be protected against unforeseen mechanical malfunctions (e.g. engine or gearbox failure) that are not covered by a general service or maintenance plan
• Saving money: An extended car warranty is like financing potential repairs at below cost
• Backing and support: You’ll receive assistance from the company that backs your extended car warranty. Many of us are at the mercy of professional mechanics. It’s not a problem if they are honest and trustworthy, but unfortunately, this is not always the case
• Your warranty can inform the repairs company that you are not alone and that you have immediate assistance if you need it
• Maximum resale value: A motor warranty is transferable to the next owner of the car, so it can increase your resale value.