Torque Tips | Vehicle insurance policies and what you need to look out for

Vehicle insurance policies and what you need to look out for

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-make the right choice-

If you have been considering insurance for your vehicle and you do not know where to start or more importantly what to look out for, then you’re in luck. Today we are here to assist you and share a few vital tips you need to look out for and inquire about if you are considering insuring your vehicle. If you have just bought a new vehicle or if you would like to invest in vehicle insurance for the new year, we have got you covered.

The type of insurance you need

First and foremost you need to figure out the type of vehicle insurance that you will need, and this all depends on knowing the type of cover you want and how much it will cost. Comprehensive cover covers everything such as high jacking, theft and damages to your vehicle. Although this is the most expensive option it is the option with the most piece of mind. When a vehicle is under finance the law requires that you have comprehensive insurance cover.

Third party insurance only cover other vehicles damage if you are involved in an accident. With the cost of repairing a damaged vehicle today it is wise to have at least this cover. Nobody wants to pay another person’s vehicle damage for the rest of their lives if you caused an accident.

What’s does your vehicle insurance package/ policy cover?

Secondly, you will need to know what your vehicle insurance policy covers, as simple as it sounds many people opt for the bare minimum and the moment they claim they realise that their insurance won’t cover the cost that they might have initially thought they would (such as damage to their vehicle), that is why we advise that you always read the fine print and so proper research, insurance policies can be tricky.

Do they offer any discounts?

This is important and not often though about, especially when renewing your vehicle insurance each year. The following are some of the various discounts available to you:

One of the first discounts you should inquire about is No-claims bonus, and if you are already with an insurer, then you should know that your vehicle insurance provider rewards you for each year you are with an them without making a claim, also know that this discount usually caps out (reached the maximum amount) after around five years and varies depending on the insurer.

Then some vehicle insurance providers also offer restricted driver discounts, this is a discount on your policy if you’re willing to exclude drivers under the age of 25 from being able to claim on your policy, this is due to the fact that drivers under the age of 25 are seen as a ‘high risk’, and your insurance provider will reward you knowing that you are less likely to claim from them due to this fact.

There are many more discounts available depending on your vehicle insurance provider, once again we advise that you do proper research and inquire more about this from your current vehicle insurance provider as well.

Are you going to insure it for its Market or Book value?

Deciding whether you want to ensure your vehicle for its Market, Trade or Book retail value all depends on what you are willing to settle on when you claim from your insurance provider. Most reputable insurers will insure for retail value so that you as the insured do not lose out unnecessarily. Here is a basic breakdown of the biggest pros and cons of both.

Market value

Pro: Market value will mean that your vehicle is cheaper to insure each year.

Con: Your vehicle may not be worth as much on the “market” as you’d like, as the market constantly changes due to demand and the economy status.

Book value

Pro: You know exactly how much you’ll be getting for your vehicle in the event of an accident.

Con: You’ll be paying a bit more each year than someone with market value cover.

Modifying your vehicle at your own risk

If you’re considering modifying your vehicle in any way, shape or form then you might have to think twice, any modification that is not done or approved at the dealership will affect your premium and could also stop you from being able to insure your vehicle at a specific and most vehicle insurance provider. Before modifying your vehicle at all, contact your insurer to find out whether they will offer you cover with the modifications – and if so, how the modifications will impact your premium.

Written by: Ashley Roos