Short term insurance broker Robert Duncan reminds us that there are a number of things to look out for when it comes to insuring your cars during tough times…

Do you have vehicle finance? Don't skip a payment on your insurance!

If your current vehicle was purchased under a vehicle finance package, there is no doubt that times are tough. Chances are you have a mortgage to pay on top of your car finance and during tough times these payments alone are causing you and your family enough headache without having to worry about things like insurance.

Yet one of the stipulations of your vehicle finance is that you must have insurance on the vehicle, so paying for insurance is unavoidable. Once you skip two payments in a row you have breached the terms of your vehicle finance agreement and your vehicle will soon belong to your vehicle finance company. This is not the position you want to get yourself into, so remember how important those monthly insurance payments are.

Often, if you do miss two payments, your vehicle finance company will allow you to keep the car, but on the provision that you move your insurance over to their own insurance division. Chances are that these premiums will be significantly higher than what you were paying before causing you even more trouble.

Going direct is not always best

During tough times it is often possible that some months will be tougher than others, especially if you are paid on a commission structure. Money that you used to get every month is no longer coming in regularly and occasionally you will want to skip a payment in order to ease the pressure for the month.

While skipping is not advisable, this situation is far easier to handle if you are working through a credible broker who will have slightly more relaxed policies on the matter than the insurance companies themselves. Skipping a payment if you are directly insured means big pressure from your insurer whereas good brokers tend to be more willing to listen to your individual case.

Sure, going direct can save you something on the monthly premiums, but in times of trouble your broker is far more likely to be understanding.

Third party is always an option

Many people cancel their insurance altogether during a recession, but being uninsured opens you up to massive losses if you have an accident. Driving without insurance is the worst mistake you can make!

If you are genuinely struggling to afford your monthly insurance premium, why not shift your cover to third party insurance? That way, while you are significantly reducing the cost of your cover, if you cause an accident you will at least be able to cover the damage to other parties' vehicles. The last thing you want to be doing is paying off a large chunk of money to fix a luxury German sedan that belongs to somebody else.

Remember, while times are undoubtedly tough, insurance payments are often an unavoidable expense — especially when you need your vehicle to get to and from work each day.

If you are genuinely struggling to make payments each month or are unhappy with your current insurance provider, why not use the links in this article and search South Africa's top insurers to find the most competitive quotes on your vehicle and household content cover?

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