What Are The Requirements to Apply for Car Insurance in SA?

If you've never had to get a car insurance quote or conduct a car insurance comparison, you might have found the process intimidating or complex. If you need clarity about how to insure a car and what the requirements are to get car insurance, Budget Insurance is here to help. Discover more about how to qualify for car insurance and what you need when applying. 

Is car insurance a legal requirement in South Africa?

No, car insurance is not a legal requirement. While insurance isn't a legal prerequisite for car ownership — provided you purchase a car in cash or create a payment arrangement with an individual seller. However, if you require formal financing from a bank or financial institution, you must insure a car comprehensively for the contract period or until your car is paid off.

Many drivers confuse Road Accident Fund (RAF) coverage and private insurance coverage. In reality, each offers a different form of protection. The RAF indemnifies drivers against claims made against them based on death or injury, including legal and medical fees, loss of income while being unable to work or temporary/permanent bodily harm. Insuring a car protects you against vehicle damage, theft and damage from the elements, like fire or storms. 

How to choose car insurance

Many drivers fail to consider how damaging or destroying their car will impact their lives. It can take seconds for an accident to occur, and even if nobody gets hurt, the fallout could cost you financially.  Calculating car insurance needs requires asking yourself the following questions:

●   What do I drive? The newer the car, the more coverage you'll want, as your car will likely be costlier to repair or replace. 

●   How do I drive? Your risk profile will help inform what coverage you should take out. You'll probably need more coverage if you have limited driving experience or a history of poor driving behaviour.

●   How will I drive? When, where and how frequently you drive matters. If you are retired and use your car infrequently, you will likely face less risk than if you commute in heavy traffic daily.

Once you've finalised your choice of insurance, read through your prospective policy document thoroughly, paying attention to the fine print and noting any questions you have. When ready, consult your insurer to arrange coverage with limited overlap and no cancellation fees.

Once the insurance is in place, make sure that you review your coverage annually. 

Requirements for applying for car insurance in South Africa

When you apply for insurance, ensure you have all the necessary documents and information ready. Being well-prepared will speed up the process. You will need the following: 

• A valid driver’s licence — yes, it is a requirement!

• Vehicle registration certificate: this shows the vehicle owner’s name and — if the vehicle is financed — the name of the bank or finance institution.

• Vehicle details: the year, make, model, engine number and VIN number.

• Personal details: name, address, contact details, ID number, proof of residence, driving history, bank details and possibly other information.

How long does it take to get car insurance?

Getting car insurance is generally a simple process; however, it can take a little longer if you haven't insured a vehicle before. You can speed up the process by being prepared. Complete the paperwork and ensure that any required documentation is up-to-date, verified and readily available.

Be sure to check if your insurer has any mandatory waiting periods and if they might affect your driving behaviour. For example, if you cannot make any claims in the first few months, you can avoid taking long trips until the period has passed to decrease your accident risk.

Will I be accepted for car insurance?

Before you get anxious about whether an insurer will reject your application, you should know that it’s highly unlikely you will be turned away. However, here are some instances where you could get rejected:

• When your credit report indicates that you have missed insurance payments before or may not be able to afford your monthly premiums. Non-payment of your premiums can also cancel your insurance.

• Providing fraudulent or misleading information. This can include lying about who the primary driver is to qualify for lower premiums or failing to disclose a drunk driving charge. 

• If you ever damaged or write off your car while breaking the law. For example, if you used it to commit a crime or drove under the influence of alcohol. 

Get a car insurance quote from Budget Insurance

Applying for car insurance isn’t a hassle with Budget Insurance. However, we fully understand that many people find the process confusing, so we are here to help. Speak to a trained insurance consultant for more information, or apply for a free, no-obligation car insurance quote online. 

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Sources:

[1] IOL: Know the difference between car insurance and RAF cover

Disclaimer: The information in this article is provided for informational purposes only and should not be construed as financial, legal, or medical advice.