Driving Performance: Exploring BMW Car Insurance Features

For cash-strapped South Africans, price is often the deciding factor in many purchases. While there is no harm in switching to a cheaper brand of cereal for your breakfast, changing to cheap Car Insurance (although tempting) could mean compromising important protection.

Which – with South Africa's high rate of car accidents, theft, and hijackings – you don't want to do. Budget Insurance offers Budget Lite, an alternative to cheap Car Insurance that allows you to save on your insurance without skimping on the cover. Here's why you should consider it.

 Is cheap Car Insurance better than no Car Insurance?

Having absolutely no car insurance is a major risk, one that could cost you dearly in the long run. Car Insurance is there to protect you financially if something unexpected happens on the road – damage, theft, or legal fees from an accident. Without insurance, these costs all have to come out of your pocket.

However, going for the cheapest option may not be any better than having no insurance at all. Affordability should always be balanced with the quality of the cover and the reliability of the insurer. The best Car Insurance quote is one that is affordable for you and includes all the cover you need – because when you're dealing with the stress of a damaged or stolen car, you don't want your insurer adding to it.

The dangers of cheap Car Insurance

 While some of the risks of cheap Car Insurance are known — and even listed in the policy documents — others are less clear. And you might find yourself so charmed by a low quote that you become blind to the obvious dangers.

Before you reason you've never been in an accident, you need to consider that in South Africa only 3 in 10 vehicles are insured1. And if you do add to the 800 000 annual vehicle accidents in South Africa2, it could prove very costly to you even if another vehicle was responsible for the car accident.

Other things to consider before choosing cheap insurance for cars include:

• Limited coverage: That cheap policy you've just been quoted on might only cover the basics, leaving you to cover the costs for major damage. John is a prime example: he signed up for the cheapest car insurance he could find. His car is parked in the open while he is at work, and one afternoon, a summer thunderstorm turns into a severe hailstorm. John's car ends up with more dimples than a golf ball, and the windscreen is smashed. Unfortunately for him, it is only after calling his insurer that he realises his cheap insurance doesn't cover hail damage.

• Difficulty getting claims processed: When you do need to claim from your insurance, you want it to be a fast and hassle-free process. Cheaper insurers may cut costs by having a smaller workforce, with each claims adjuster handling hundreds of claims at once. And what should be a fast process ends up stretching on for weeks or even months.

• Poor customer service: Reducing costs might mean the insurer offers no online support, expecting you to call in for every query you have. In addition to long call waits, you are quite likely to deal with staff who can't answer some basic questions.

• High excess: We expect an excess to apply when making a claim, but what if your lower premium also means a higher excess? Peter brags about how little he pays for insurance, but never mentions that his excess is R20,000. After damaging one headlight and scratching one side of his car while turning too sharply into his driveway, Peter gets a repair quote for R9,000 – and because it is less than his excess, Peter will have to pay the full R9,000 himself.

• Hidden fees and costs: There are several disingenuous ways in which a disreputable insurer might appear to offer lower premiums. These include adding a monthly administration fee that is not reflected in the original quote. Other fees you wouldn't normally expect are admin fees every time you make changes to your policy, along with late or missed payment penalties.

• Limited additional benefits: Some accidents can leave your car unsafe to drive. But you might find your cheap Car Insurance doesn't cover towing or even storage, neither of which is affordable. 

• Less flexibility: A low-cost insurer could work with a smaller network of approved repair workshops. This might mean having to settle for substandard repairs. Additionally, your ability to customise your cover could be severely limited, leaving you paying for cover you don't need.

• Vague policy wording: Your policy document should be easy to read and understand – an easy way to hide important information is with ambiguous wording. Only when you try to make a claim do you learn of specific exclusions hidden in unclear terms and conditions.

Introducing Budget Lite

If full Comprehensive Car Insurance breaks the bank, Budget Lite from Budget Insurance could be the solution you need, especially if your vehicle is worth under R250,0000 and is fully paid off. 

Here's how this cover offers peace of mind along with affordability:

• Different levels of cover: You need options, and Budget Lite offers three options to suit your needs and budget: Budget Lite 1 protects you from theft, hijacking and third-party liability (if you accidentally cause damage to someone else's property or injure someone). Hail damage and accident damage to your car are not included in this option. Budget Lite 2 includes everything from the first option plus cover if your car's written off because of an accident or hail damage. It also includes Accident Assist for towing and storing your vehicle damaged in an accident. Budget Lite 3 is the most comprehensive option, covering all the above, plus limited accidental damage for repairs to your car (up to R15,000). Best of all, it is available for financed cars.

• Reliability: Budget Insurance has a solid track record, so you know your claim matters. You can expect good customer service, reliable claims processing and financial stability.

• Transparency: You know exactly what you're getting, with no hidden surprises. Budget Lite offers straightforward plans that let you know your limits up

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• Additional perks: While tailored for affordability, it still allows for optional extras you can add on. These include cover for your sound system or bakkie canopy, and a Cash Back Bonus when you don't claim.

 Get affordable Car Insurance from Budget Insurance

Don't let financial constraints prevent you from being protected on the road.  Budget Insurance lets you tailor your coverage to your needs and pocket. Get a quote and see the difference for yourself.

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Sources:

[1] News24: Having minimum cover is better than not being insured at all 

[2] Automobile Association - Don’t take the insurance bait - cheaper isn’t always better

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