Comprehensive car insurance vs third party insurance explained

Having a car makes life more convenient in so many ways. However, if you don’t take the necessary measures to protect your vehicle, it could end up costing you more than anticipated. 

Car insurance protects you from paying through the nose for repairs often caused outside of your control. Most car owners know that you can choose between comprehensive car insurance and third-party car insurance, but if asked, could you explain the difference between the two? In this article, Auto and General will explain the key differences and benefits of both.

What is full comprehensive car insurance?

Comprehensive car insurance covers the costs accrued from almost every financial eventuality a person could face involving their car. 

Your insurance provider will cover you and your car in the following situations:

• In the immediate aftermath of an accident, fully comp plans will pay for your car to be towed to and stored safely and securely until it is assessed.

• Your insurance provider will also arrange for a hire car to be delivered to you so that you can continue with your day to day life. 

• In the unfortunate event that your vehicle is written off or stolen, the insurer will issue a replacement vehicle.

• If the incident involving your vehicle results in someone dying or getting injured or another person's property is damaged, you're covered against any claims made against you.

• Last but not least, repair costs due to accidents caused by you or the weather will also be covered.

What is third-party car insurance?

Third-party car insurance is more basic and offers the minimum level of coverage. It only covers you for the costs accrued from damaging another person's car or property. 

This means that if you're in an accident and your vehicle is damaged when it crashes into another car, the driver of the other vehicle can claim against your insurance. The insurer will cover the costs for repairs or replace their car if it's a write-off. You will need to pay for your own vehicle to be fixed or replaced. You also won't recieve anything if your windscreen is damaged due to a hailstorm or if your car is stolen.

What’s the difference between comprehensive and third-party insurance?

One comes with the most coverage and the other, the least. This is also reflected in the cost, so expect to pay less for third-party vs fully comp. Comprehensive car insurance also offers additional benefits whereas third party does not.

It’s important to note that, when it comes to car insurance, there are some things that the majority of insurers won’t cover, regardless of what level of insurance you’ve invested in.

Insurers won't pay out in the following circumstances:

• The car is poorly looked after, unroadworthy or is used for carrying more weight than it should.

• You drive without a licence or with an endorsed or invalid one.

• You were abusing substances at the time of the accident.

• You were using the car to carry fare-paying passengers, for racing or for motor trade purposes outside of offering servicing or repairs.

• Someone else was using your car without your consent, and you failed to report it to the police and lay a charge within 48 hours.

• Your accident took place outside of South Africa or its directly bordering countries.

You also won't be covered if you are held legally liable for someone dying or sustaining an injury while driving with you. Any damage to your possessions and that of your passengers also won’t be covered in that case.

Is fully comprehensive insurance better than third-party insurance?

We've all heard the saying that you get what you pay for. While quality increases with an increase in price in most cases, cars don't function the way that many other assets do. 

As your car wears down over time and its value decreases, spending more on a comprehensive car insurance product might not make financial sense anymore. After all, insuring a car worth under R20 000 means you'll only walk away with R20 000 should your car get written off, which certainly isn't enough to buy another car quickly. The cost of repairing your car could also be more than the car's value!

For this reason, getting comprehensive car insurance is a better choice if you own a new or valuable car. Should you lose your car or need expensive repairs, you can rest assured that you'll be covered for them. 

If you're driving a car that's seen better days and is worth very little, it might be a better idea to choose third party insurance and place any saved money in a savings account to handle unexpected expenses.

Still unsure which option is best for you?

Taking your time to choose the best insurance option for you will never be time wasted. If your current insurer can’t address your concerns or answer your questions, it might be time to look for someone that does. Auto & General is happy to help you make the best decision for your needs. Please request a quote from us today.