CRA Insurance News – South Africa
By JUSTUS VISAGIE
The arrival and effects of Covid-19 have accelerated many changes that were already afoot. It seems tech is shaking up the financial sector once again.
Insurtech companies offer a compelling proposition, particularly when it comes to pricing.
Cheral Kennedy is a landscape designer from Worcester in the Western Cape, and works from home.
When her 1996 BMW 316i neared a galactic 530,000km in mileage last year, she got rid of it and in January bought a 2014 Mini Cooper S Countryman from a dealer.
When it came to insuring it, “I didn’t have a lot of time to shop around, but I received three quotes”, she says. OUTsurance quoted a premium of R851, Budget Insurance R844 and Naked R384. The car is insured for R230,400, with a R5,000 excess amount and third-party cover of R5m.
Kennedy chose Naked and upgraded the cover to comprehensive (adding car rental, windscreen cover, etc) and stated that it will be used for work. This brought her monthly premium to R510.
“If I ‘switch off’ the insurance when I’m not using the car, it goes down to R386 a month,” she says. This she can do easily through the Naked app.
Ernest North, co-founder of Naked Insurance, explains: “Naked developed a feature called CoverPause, which enables you to ‘pause’ accident cover on the days you don’t drive.”
While using CoverPause, you remain covered for fire, theft and incidents such as weather damage while the car is parked, non-driving accidents such as the carport falling in on your vehicle, and someone else driving into your car.
When you need to drive, you can simply resume the cover for (driving) accidents with a click on the app.
“The average customer usually pays roughly 55% of their comprehensive cover rate when CoverPause is active,” North says. But, until September 30 this year, Naked customers will pay only the lockdown rate of 10% or so of their usual premium on the days they pause their driving insurance.
Hollard underwrites Naked. Pineapple, which takes a similar approach to insurance, is backed by Santam.
In response to the disruptors, King Price has launched Chilli, which is accessible via the King Price app. The company advertises that comprehensive insurance could cost just R299 a month for a car valued up to R500,000 if the owner drives 100km or less.
This excludes the fitment of a tracking device and a subscription of R69 a month to Cartrack.
In a “test drive” of Chilli, Kennedy’s Mini Countryman was used as the guinea pig, with an excess amount of R4,500. For driving 200km-299km a month, the monthly premium came to R350.
Article Credit To Business LIVE.