Types Of Car Insurance In South Africa
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Car insurance is an absolute necessity, for it serves
as a financial protection to the individual in case of
unforeseen circumstances. In some countries, people receive
huge fines for not having car insurance, plus your car
can easily be taken away. It is in every ones best interest
to know exactly what the specific types of car
insurance protects you against, and what doesn’t
it covers. It is of equal importance to make yourself
familiar with the circumstances under which coverage is
offered, and when it is not. In example, coverage will
not be given when someone else caused an accident with
your car etc. Therefore one should read your insurance
policy carefully, before signing it. In the most cases
basic car insurance policies do not cover items that are
installed in your vehicle such as radio’s and cd-players.
It also do not provide financial security for other household
possessions in your vehicle at the event of the accident,
such as clothing and jewelry.
It is important to note that car insurance consists of two facets: one that pays for damage and injury to others and one that pays for damage and injury to the policyholder.
Comprehensive coverage
This type of car insurance protects you against fire, theft and accidents. It also protects the other party and their car, involved in a accident with you.
Third Party Fire and Theft coverage
This is a cheaper type of coverage and it covers medical expenses of the people involved in an accident, but it doesn’t covers damage to your car in case of an accident. It only compensate for fire and theft to the car. One can also purchase Third Party coverage, which only covers the vehicles and the people you are in an accident with.
Bodily injury liability
This refers to the legal responsibility of the at-fault driver to financially compensate for the innocent parties’ injuries. It protects the policyholder from having to give up assets in order to meet the legal obligation, by making payments.
Property damage liability
When a auto accident accurse, the at-fault driver has the legal obligation to compensate for the property damage that he have caused because of his negligence.
Medical payments
Medical payments refers to that aspect of an insurance policy, which have been designed to pay for the medical bills of the injured victims. This regularly pay for the injuries of the insured parties which they sustained in an accident, regardless of any legal liability.
Uninsured and underinsured driver
In some countries automobile liability insurance is required. In other parts of the world automobile insurance is subsidized by the government and in some cases there are no liability requirements. Uninsured and underinsured insurance were developed in order to financially protect the innocent party in case of an accident where the at-folt party has, inadequate or no insurance to pay for the injuries of the innocent party.
Physical damage – Collision
In the context of insurance, physical damage refers to benefits that will be paid out on behalf of the policyholder. A deductible applies to the physical damage section of ones policy. A deductible is an amount that a customer has to pay towards vehicle repairs, before the insurance company pays out. Collision coverage of physical damage will pay out benefits to the customer to repair his vehicle in case of an accident. An automobile policy defines that this benefits will only be paid out to the policyholder and not to any other victims, because property liability serves the interests of them.
Physical damage – Comprehensive
Comprehensive benefits are only available to the policyholder’s vehicle and it covers cause of damage such as fire, hale and theft, and not just collision damage.
This article briefly discussed the foundational issues regarding car insurance coverage and although it left many aspects untouched, it can definitely serve as a solid preparation for someone who is about to consult a broker for a new car insurance policy.
