South Africa’s roads have become dangerous for motorists who must contend with many reckless drivers on a daily basis. Of all the South African motorists, only 30% have car insurance1, which is even more reason to purchase cover for your car. The problem is that comprehensive car insurance may be too expensive for many, especially during these harsh economic times. And this is where the more affordable third-party car insurance can still offer some peace of mind2,3.
Third-party car insurance – what does it cover?
The reason why third-party car insurance is considerably cheaper than comprehensive car insurance is that it only covers damage done to a third party’s car2. That means you’ll have to pay out-of-pocket for your own car’s repairs. Your vehicle is also not covered for theft, hijacking, or fire2. But, on the positive side, this insurance protects you from the cost of crashing into a brand-new luxury car and having to cover extensive costs for the other vehicle2. Most motorists would not be able to settle a total loss claim using their own cash, which could be equivalent to financial ruin for many South African motorists.
Who is the third party?
The third party is the owner of the other vehicle involved in your accident2. The third-party will put in a claim for damages incurred to his car after your car crashed into it; you are the first party, and your insurer, who settles the claim, is the second party2. The third party may also be a shop owner who puts in a claim after you damaged his shop window with your car2. Check all the fine print of a policy to ensure you understand the full extent of your cover.
What if the accident is not your fault?
If someone else damaged your car because it was the third party’s fault, you could bring a claim against that third party2. Hopefully, the third party in South Africa has comprehensive or third-party car insurance. If not, you would have to fix your car at your own expense if you only have third-party car insurance2. Some countries have made third-party car insurance compulsory for all motorists2.
Sometimes it’s not clear who was at fault
It can happen that it’s not clear who’s at fault in an accident. For instance, you may reverse and bump a car while that driver could have avoided it by getting out of the way. In such a case, the insurer follows a procedure called ‘apportionment of damages’, where the pay-out is proportionally made, depending on each one’s fault level2.
PMD offers affordable third-party PLUS car insurance
This product and its growing cover component protect you from third-party claims3 as well as cover for smaller accidents up to 100% of your cars trade value. The ever-increasing cover helps towards the costs of repair or loss in the event of minor accidents and can grow up to 100% of the car’s trade value3. Another benefit includes third-party liability cover, with liability protection extending up to R500 000 per incident3. The last benefit is hail damage cover, protecting your car from damage up to R10 0003.
Disclaimer
Use this article only as information because of car insurance’s complexity. First, get professional advice from a certified financial advisor before buying car insurance.
If you consider your current car insurance too expensive, why not contact PMD? They offer affordable car insurance with unique benefits like fixed premiums. Buying car insurance cover online with PMD is a convenient option for South African motorists. T’s and C’s apply.
Sources:
1https://www.news24.com/citypress/business/70-of-south-african-motorists-have-no-insurance-20210702
2https://www.moneyexpert.co.za/car-insurance/third-party-cover/
3https://prime.co.za/car-insurance/third-party-plus/
This article was prepared by Eric Sandmann in his personal capacity. The views and opinions expressed in this article are the author’s own. The views and opinions in the article should not be attributed to anyone but the author unless expressly stated. Nothing in this article should be relied upon as advice, this publication is presented for informational purposes only. No person should act or refrain from acting in reliance on any information found in this article, without first obtaining proper financial advice from the appropriate professional. The author makes no claims, promises or guarantees about the accuracy, or completeness, of any information linked from, referred to, or contained in this article. The author reserves the right, to edit and change the content of this article.