The average South African pays quite a bit more to keep a car on the road these days than they did 5 years ago. In fact, to be precise, it costs R6,711.24 more every month in 2022 than it did in 2017. Or, if you prefer, we pay approximately 40% more to run around in our own cars now.
We’re all doing our best to find ways to maintain our responsibilities, keep up with our bills, and enjoy life. After all, our existence is more than the things we need to pay for. It’s also about seeing that sunrise, going on a relaxing holiday, and braaiing with the family.
To do all that, though, you need to find ways to cut back and save. In this article, we’re going to review how much car insurance costs, how your premium is calculated, and what you can do to save.
The Average Cost Of Car Insurance In 2022
This year, your car could cost you around R9,356.80 per month when all’s said and done. That’s almost R10,000 on fuel, vehicle finance installments, other running costs (bits of maintenance, engine oil, that sort of thing), and of course, car insurance.
Now, because the market is a bit shifty at the best of times, this figure is merely a guideline. But you’d probably agree that it’s pretty realistic.
But what portion of this is parceled off to your car insurance provider? According to data online, car insurance for 1 unnamed type of car could cost an average of R1,322.13 per month. It’s worth noting that the actual cost of an insurance policy boils down to the specific type of car, which insurance policy has been selected, and who the policyholder is.
Here’s why this info matters.
How Your Premium Is Calculated
Insurance companies take several factors into consideration when calculating each policyholder’s premium. Some of these factors are obvious, like the make and model of your car. But there’s quite a bit more to know, including the value of the car, its VIN number, and where it’s parked at night and during the day.
Insurers also consider various details about you as the person who’s buying the policy as well as the regular driver of the car that’s being insured. It’s this info that helps them build a risk profile unique to you and will help them calculate the premium or decide whether or not to sell you a policy at all.
Details That Insurers Tend To Use
Your job may involve a lot of driving, which increases your risk of being involved in an incident, or you may see clients a lot, which would mean that you need a specific type of policy (business cover instead of comprehensive).
The Kilometers You Clock Up
The more you drive, the more likely you could be involved in an accident, which makes you a higher risk.
Age And Experience
These are considered together in order to gain a complete picture of your potential risk. For example, you may be older and wiser… Or, if you’ve only been driving for a few months then you’re less experienced and pose a higher risk.
Any modifications to your car can impact your premium. Some = an increase, like a more expensive sound system, while others = a decrease, like a tracking device or rear sensors.
A history full of claims is an indicator that you’re likely to claim in the future, resulting in higher premiums to account for the bigger risk that you pose. In severe cases, you might not be given a policy. Alternatively, a relatively spotless claims history tells your insurer that you’re able to prevent avoidable losses, resulting in lower premiums.
Tips To Lower Your Premium
And now we’ve come to the good part… Usable tips that you can review to see if they can help you reduce your car insurance premium.
- ABC (always be covered), because ‘interrupted’ stretches of cover is interpreted as risky to insurers. If you’re struggling, call your insurer to see what they can do to help.
- Choose a higher (but still affordable) excess, which will bring your premium down.
- Improve your security by installing a tracking device, an act that lowers your risk and premium.
- Avoid fancy aftermarket additions, like boot spoilers or a big sound system, which can increase your premium.
- It could be time to sell your car if it’s too expensive to insure and run, and instead go for something safer and with a smaller engine, which results in vastly cheaper premiums.
If you’re interested in switching to simple cheap insurance, call 0860 50 50 50 or click here to get a commitment-free quote today.