Short-term Insurance Explored
Sponsored by OUTsurance
Is your car insurance comprehensive enough as you want to hit the road with peace of mind?
If you could only choose one car insurance package in your lifetime, comprehensive car insurance would be the one to go for.
Though the actual product name may vary from one insurance company to the next, comprehensive car insurance typically refers to the product that offers you the best insurance and the widest coverage.
Enjoy a Premium Insurance Offering
Comprehensive car insurance generally provides cover in the following instances:
- Acts of nature (for example flood, hail, lightning);
- Accidental damage (for example bumper bashings);
- Theft and hijacking (for example smash and grab incidents);
- Fire damage;
- Intentional damage (for example someone purposely causing damage to your vehicle); and
- Third-party damage (for example instances where you can be held legally liable for damage to someone else’s property).
Keep in mind that your insurer may not necessarily include all the above as part of its comprehensive car insurance offering. (The above example is based on the OUTsurance comprehensive car insurance offering.)
In contrast to this, a limited insurance package may only provide cover in a few selected instances such as fire, theft and liability claims.
Some insurers also offer liability cover on a stand-alone basis to help you cover the cost of damages associated with third-party claims.
Enjoy a Host of Included Benefits
Many insurance companies have structured their comprehensive car insurance product in such a way that it also includes a list of benefits designed to make your life easier.
This may include 24/7 roadside assistance, medical or armed response, or a trip monitoring service (sometimes only available at an additional premium).
In 1998, OUTsurance introduced South African consumers to the Cash OUTbonus, where you get cash back if you remain claim free for a specified period. Since then, it’s become commonplace for other insurers to also include some sort of reward system as part of their comprehensive product offering.
The Benefit of a Fixed Excess
The only downside of comprehensive cover is that your monthly premium will be considerably higher, especially if you compare this to the monthly premium for liability cover only.
In addition, you need to make sure you understand exactly what your excess amount will be in case of a claim, and if any additional excesses apply. In which case, you’d need to pay additional amounts on top of your standard excess.
Many insurers calculate your excess payment based on a set percentage of the claim amount, whereas others ask you to pay only one fixed amount, regardless of the value of your claim and without applying additional excesses. OUTsurance is one example of an insurer who charges a flat, fixed excess.
Consider the difference in cost if your claim amount is R100,000. An insurer who works on a 10% excess structure will require you to pay a R10,000 excess. Compare this to a fixed excess where you may only need to pay R5,000, regardless of the nature or value of the claim.
Main Image: Hail, theft, bumper bashes and more — does your car insurance cover everything you need it to? Picture: OUTsurance
Read Also: New Driving Rules Proposed For South Africa
This article was sponsored by OUTsurance, article published in Times LIVE Motoring.
What is your view regarding comprehensive short-term insurance? Do you think you need it, especially in South Africa? Let us know in the comments below. Also, if you found our content informative, do like it and share it with your friends.
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