The second largest purchase that most people will make in their lifetime is the purchase of a new vehicle. This falls directly behind purchasing and wning a house. The main difference is that statistics show that whilst people might change their house two or three times in a lifetime, the same owner will change vehicles at least ten times if not closer to twenty.
The law requires that every car on the road is insured. Basic insurance or compulsory insurance only covers any other cars for damage and repairs in an accident that is defined as your fault. If your car is also damaged, the costs will come out of your own pocket.
Most people are aware of this and cannot afford to pay for the high car repair costs or for a new vehicle if the old one is damaged.
When accidents do occur, they are often deadly and tragic. The vehicles are usually demolished and totaled, and if fixable, they will cost a lot of money!
Of course you do not. But people will refer to you as stupid if you go out, are involved in an accident, and now have no means to cover the damages. Now you are walking or biking to work.
However if you are covered by comprehensive car insurance, the damages are covered by the insurance agency.
Insurance premiums are calculated on an annual basis, and should run at around 6% of the replacement value of your car.
Insurance premiums are calculated on an annual basis, and should run at around 6% of the replacement value of your car. A lot of people will gladly cover that amount to insure much stronger protection from the insurance company.
Comprehensive car insurance will cover anything from accidents where you are at fault, to accidents where no one but yourself was involved, or cases of theft. It’s very important to cover yourself from damages incurred via theft.
Car theft happens all the time, as many robbers find radios, disc players, GPS systems, and other items in the car very desirable. Protect your goods with extensive coverage.
Graham McKenzie is the content Syndication Manager at Insurance123.co.za South Africans leading car insurance information portal
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