What Car Insurance is Required by Law in SA?

Car owners are not legally required to take out car insurance unless the car was purchased with a loan from a bank or other financial institution.

Some drivers rely solely on Road Accident Fund cover but claims are often processed slowly, outcomes may differ from what is expected, and cover is limited. Expenses for medical and funeral costs are covered and so is compensation when a breadwinner is killed due to another driver’s negligence. However, no cover is provided if a driver is sued for damages to another person’s property or vehicle.

Why Get Cover?

Accident statistics are a good indicator of the importance of being covered, regardless of whether your vehicle purchase is being financed or not.

Recent estimates show that 65 - 70% of the approximately 12 million vehicles on South Africa’s roads are uninsured. It is also estimated that at least 14 million families face a combined insurance shortfall of almost R29 trillion if the main breadwinner were to become disabled and unable to generate an income any longer. Consider the following road accident statistics :

  • Annual deaths – Around 15,000 per year (over 40 per day).
  • Deaths over the past decade – Over 134,000.
  • The number of accidents – Close to one million reported annually.
  • Disability – An average of 20 people left permanently disabled per day.  
  • National car accident costs -  Road accidents cost South Africa  R142.95 billion per annum, which is 3.4% of South Africa's (GDP) and much higher than the 2.2 GDP cost for similar countries.
  • Accident cost breakdown – The Gauteng Roads Department confirmed that total crash costs can be broken down as follows:-
    • Human capital: 69.3%
    • Vehicle repairs: 14.9%
    • Related incident costs 15.8%


What Car Insurance Do I Need?

Statistics prove that driving can be dangerous, and drivers should safeguard against these risks by taking out insurance to meet their needs and budget from the 3 main types:

  1. Comprehensive vehicle insurance which although most expensive provides the best cover and protection in event of accident, theft and, damage including flooding and fire.
  2. Third-party fire and theft that, despite being less expensive and not covering car replacement, provides cover for damage caused by fire, theft and, hijacking.
  3. Third-party cover, usually the cheapest in the market, only covers damage to other vehicles in the accident.

Remember that your car insurance won’t cover you for:

  • Normal wear and tear
  • Intentional damage
  • Loss or damage should you leave South Africa’s borders without the appropriate certificate from your insurer or broker showing you have cover outside the country. 

While Auto Pedigree offers vehicle insurance against theft, damage, and accidents, we also provide a range of products and services such as vehicle interior and exterior maintenance cover to minimise normal wear and tear.

Do you have questions on vehicle finance? Fill in the online form or call 086 011 1133 – we’ll help you find the best comprehensive vehicle insurance cover for your individual needs.  

Disclaimer: This information is for educational, or entertainment purposes only. It must not be construed as advice, legal, financial, or otherwise. We do not make any warranties about the completeness, reliability, and accuracy of this information.