Why you shouldn’t cancel your car insurance

Some suggest canceling their motor warranty altogether. But it might not be a feasible option, As your assets are exposed to significant reach, and it reduces the extent of your cover. Cutting costs does not have to mean voiding your policies; it’s not an all-or-nothing scenario.

If you are assessing something, you should note that less than 35% of cars in South Africa are insured; and 65% aren’t insured. You have to depend on the other party’s insurance, If you are not guaranteed to cover you in the event of a crash if the other person has insurance (and, given the numbers, this is unlikely).

From a risk outlook, being uninsured or not having car warranty plans means you are responsible for all the expenses if the need arises. This may be heavy on your pocket, and you won’t be eligible to cover it. Also, the repair of your damaged car will be denied. Are you up for taking this risk?

These are some options you should consider:

Firstly,

More than ten home and car insurance options are available to match your requirements at AA Insurance Supermarket. This Insurance market sources competitive products that guide you in purchasing the best policy and not having to compromise the extent of coverage you already have. It is advisable not to change to a cheaper insurer as long as the size of your cover is the same.

Secondly, you have many car warranty plans if you need to lower the cost of your home and vehicle insurance beyond simply finding an inexpensive insurance company.

Here are a few of them:

  1. Downgrade from pervasive cover to a service that provides reduced premiums for low-mileage drivers. Usually, there is no risk for low-mileage drivers unless they do a lot of mileage all of a sudden. In such exceptions for higher mileage, the premium will increase. This is a very lucrative option when many people are traveling less after lockdown as work from home has become a thing.
  2. Increasing your initial payment lowers the premium that you pay monthly, but when you claim, there is an added financial burden. Remember those panel beaters will not touch your vehicle to repair unless the excess has been paid. This implies that if the lot is more than the amount, you will have to wait till you have cash before repairing.
  3. To reducethe premium, you should lower your cover from Market Value to Retail Value. But you were increasing the excess means you consider liability for the variance among the sum insured between the two values.
  4. Demoting from a fully comprehensive cover to a service that pays for third-party claims and total loss. This is applicable. For instance, a car is stolen and has not been recovered or has been written off during an accident, fire or drowning. The risk in this type of insurance cover is it will not cover any accidental damage. This may put you in a challenging situation where you will have to pay for the repair independently.
  5. Opting for a third-party, fire and theft-type product. This is cheaper than a comprehensive cover, yet only covers the cost of the other party’s motor involved in an accident unless your vehicle is badly damaged in case of fire and theft.
  6. You are choosing to cancel the motor warranty or partially cancel it. These are options to look into, but it is vital to know that if your motor is financed, you must keep comprehensive car insurance in place. If you void the motor warranty on a financed vehicle, the

The insurer has the right to add a policy and the premium of your motor repayment.

People will assess their budgets in these challenging times to save as much as possible. But car warranty plans are essential financial tools that protect you monetarily whenthe need arises.

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