10 Common Mistakes South Africans Make When Buying Car Insurance

Buying car insurance in South Africa can feel like a chore we’d rather avoid. You get a call from a smooth-talking consultant, they throw around terms like “comprehensive,” “excess,” “no-claims bonus,” and before you know it, you’ve signed up for something you’re not even sure you fully understand. I’ve been there. I once went with the cheapest option because it “sounded fine” over the phone. A few months later, when a taxi clipped my bumper in Jo’burg traffic, I discovered my policy didn’t cover third-party damage. The repair costs? Out of my pocket. Lesson learned.

The reality is, car insurance in South Africa isn’t optional—it’s survival. Our accident rates are high, car theft is rampant in certain cities, and the cost of even a minor repair can set you back thousands. Yet, many drivers still make the same avoidable mistakes when choosing cover. Let’s unpack the ten most common ones, with a bit of storytelling along the way.

1. Choosing the Cheapest Premium Without Asking Why

We all love a bargain. But with car insurance, that bargain might come at a cost you’ll regret later. Many South Africans jump for the lowest monthly premium without asking what corners are being cut.

A cheap premium may mean a sky-high excess (the amount you pay before the insurer pays). Imagine you’re in an accident, and suddenly you’re told your excess is R15,000. The “cheap” policy doesn’t feel so cheap anymore.

It’s tempting, especially if money is tight, but cheap premiums often hide exclusions or limitations. Always balance cost with what you’re actually getting.

2. Not Understanding Excess (Until It’s Too Late)

I once overheard a guy at a garage complaining that his insurer “refused” to pay for his repairs. The problem? His excess was more than the repair cost. That’s not a scam—it’s how excess works.

Excess is your share of the risk. If you don’t understand how much you’ll need to pay upfront when something happens, you could be left stranded. Many people only realise this when they file their first claim.

Before signing anything, ask your insurer: “What’s my standard excess? What about for theft? For hail damage? For accidents with another car?” Some policies have different excess amounts for different incidents.

3. Overestimating (or Underestimating) Their Car’s Value

A friend of mine swore his ten-year-old Toyota Corolla was worth “at least R120,000.” The insurer disagreed. When it was written off, he was shocked to get a payout closer to R80,000.

Many people misunderstand how insurers calculate value. Insurers usually pay out based on the “market value” (what a car sells for in the current market) or “retail value” (what dealers sell it for). If you overestimate, you’ll pay unnecessarily high premiums. If you underestimate, you’ll struggle to replace your car when it’s stolen.

4. Forgetting About Add-Ons (Until They’re Needed)

Towing. Car hire. Windscreen cover. These “optional extras” seem unnecessary—until you’re stuck on the N1 with a broken-down car and realise your insurer only covers towing to the nearest panel beater, not one you trust.

Many South Africans assume these add-ons are included. They aren’t. And while some extras may seem like overkill, others can save you massive inconvenience and money. Ask yourself: If my car is stolen or in for repairs, how would I get to work? Do I have roadside assistance from another provider, or do I need it from my insurer?

5. Failing to Compare Policies Properly

We live in a culture of “just go with what my cousin uses.” But insurers differ more than we think. Some are quick and fair with claims; others… not so much.

Too many drivers don’t compare beyond the monthly price. They don’t read reviews, check claim turnaround times, or even ask around. I once switched insurers after hearing how a neighbour had to fight for nine months to get her claim processed. That kind of headache isn’t worth a slightly lower premium.

If you’re shopping for cover, don’t just line up the prices. Compare the service, exclusions, and claim reputations too.

6. Not Updating Details Regularly

Insurance isn’t “set it and forget it.” Life changes. You move to a safer suburb. You start parking in a garage instead of on the street. You drive fewer kilometres because you’re now working from home.

All of these can reduce your premium—but only if you tell your insurer. On the flip side, if you don’t update details and your insurer discovers you weren’t truthful (even unintentionally), they might reject your claim.

It’s surprising how many South Africans forget this. A quick annual review call to your insurer can save you money and prevent nasty surprises.

7. Believing “Comprehensive” Covers Everything

“Comprehensive” sounds like the ultimate cover. Many assume it means, “no matter what happens, I’m safe.” Not quite.

Comprehensive usually covers accidents, theft, natural disasters, and third-party damage. But there are exclusions—like mechanical breakdowns, wear-and-tear, or sometimes even riots (remember the 2021 unrest?).

I’ve spoken to people who thought their insurer would replace tyres or cover engine failure. They were disappointed. Always check what “comprehensive” really includes.

8. Not Considering Who Else Drives the Car

In many South African families, one car is shared. The son borrows it for varsity. The partner uses it for errands. But if your policy only lists you as the driver, things get tricky.

Some insurers are strict: if the main driver wasn’t behind the wheel during an accident, they may reject the claim. Others allow occasional drivers but require disclosure upfront.

If multiple people regularly drive your car, make sure your policy reflects that. Otherwise, you could find yourself arguing with a claims assessor instead of fixing your car.

9. Ignoring Credit Scores and Insurance History

Here’s something many people don’t realise: insurers look at your credit score and claims history. If you’ve skipped payments in the past, you may be seen as “high risk.” The same applies if you’ve made multiple small claims.

One friend had a nasty surprise when her insurer doubled her premium after she claimed for two minor fender benders in one year. The insurer saw her as “accident-prone.”

The lesson? Sometimes it’s smarter to pay for small damages yourself instead of claiming. And keeping a decent credit record may help lower your premiums.

10. Cancelling Without Checking the Fine Print

Switching insurers isn’t always as simple as cancelling a cellphone contract. Some policies require notice periods—30 days is common. If you cancel incorrectly, you might get hit with penalties or find yourself uninsured for a gap period.

Worse still, if you cancel after an accident but before the claim is finalised, you could jeopardise your payout. Always check the cancellation process and line up new cover before ending the old one.

Final Thoughts: Learning the Hard Way (So You Don’t Have To)

Car insurance isn’t the most exciting topic, I’ll admit. Most of us only think about it when something goes wrong. But making one of these mistakes can turn a stressful accident into a financial disaster.

If there’s one thing I’ve learned, it’s this: don’t rush into the first policy that sounds okay. Take the time to read the fine print, ask annoying questions, and compare more than just price. And maybe learn from people like me, who’ve paid for their mistakes in cold hard cash.

Buying car insurance wisely doesn’t mean you’ll avoid accidents. But it does mean that when life happens—as it always does in South Africa—you won’t be caught completely off guard.

Published on: Sep 11, 2025

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