Of all the car insurances available in South Africa, only one is compulsory, and only for certain drivers. Comprehensive car insurances are compulsory for owners of financed vehicles. Unlike car insurances in the United Kingdom and the United States,  third-party car insurances are not mandatory for all drivers, despite the South African Insurance Association’s best efforts.

Compulsory third-party insurances would save the insurance industry from running at a loss. If an insured vehicles get hit by an uninsured vehicle, the insurer pays out the claim of the insured vehicle and then attempts to recover the loss from the guilty party. More often than not, the guilty party cannot pay for the damage and so the insurer runs at a loss.

What’s more, insureds end up paying for the damage caused by uninsureds as insurers are forced to increase the price of insurance premiums to break even. This has put the South Africa insurance industry under pressure which may lead the Department of Transport making third-party car insurances compulsory. Even if you can’t afford compulsory car insurance, there are other car insurances you can take out, which, ins such a competitive market as ours, will be affordable.

Third-party fire and theft car insurances

These types of car insurance protect you from damage you cause to third-parties’ vehicles or property, theft of your vehicle and damage caused to your vehicle as a result of fire. Car insurances of this nature are less expensive than comprehensive car insurances.

Comprehensive car insurances

The most expensive of the car insurances, comprehensive car insurance covers you for accidental damage caused to other vehicles, fire damage, theft and hijacking. As this covers accidental damage to yours and other vehicles, the premiums are higher than other car insurances.

Third-party car insurances

Cover damage to other vehicles, third-party car insurances are the most basic and most important. Even if you drive a relatively inexpensive vehicle, third-party insurance is essential as the vehicle you have an accident with, may not be as cheap to repair.

No matter the type of car insurance  you have, you can reduce the amount you pay on premiums by mitigating the risk between you and the insurer. The less of a risk you are to the insurance company, the cheaper your premiums will be.