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Comprehensive Insurance

What does comprehensive insurance actually cover?

Comprehensive Insurance

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What does comprehensive insurance actually cover?

 

When most of us buy a car we need to finance it, which means that we borrow the money from a bank and pay it off over 60 months or so. One of the conditions of the bank approving our finance is that we have comprehensive insurance cover on the vehicle, so that if it gets stolen or damaged, the bank isn’t exposed to risk.

But what does comprehensive insurance mean, what does it cover, and why is it imperative that you don’t cancel your insurance while you’re still paying off a vehicle?

Not all insurance is created equal. Insurance brokers have different types of insurance, which generally include:

 

 

1. Third Party Only (TPO),

2. Third Party, Fire and Theft (TPFT),

3. Comprehensive

 

 

Third Party Only insurance is the most basic, and only covers damage suffered by ANOTHER person or their property, in the event of an accident that you are responsible for. So if you drive into someone else’s car, and the accident is your fault, TPO insurance will cover the costs to repair THEIR car, but not yours. 

 

Third Party, Fire and Theft adds another level to the insurance coverage. Like TPO, TPFT only covers accident damage to someone else’s vehicle. But if your car is stolen or hijacked, or even damaged or destroyed in a fire, TPFT will cover YOUR loss.

 

Comprehensive insurance

Comprehensive insurance is exactly that – comprehensive. It provides cover for almost any form of financial loss related to your vehicle, be it from an accident, theft, fire or act of God. And like the other levels of cover, it also covers damage or injury caused to a third party (other person) or their property if you are responsible for the accident.

Toyota actually offers their own comprehensive insurance product called MyToyota Insurance. It’s a premium insurance product that offers not only great insurance, but a number of added benefits. For example, all repairs are done by Toyota accredited repairers, which helps to retain your vehicle’s value. It also includes cover for accidental damage, theft and hijacking, as well as third party liability. Hail damage is also included, as is damage to your windscreen as well as the factory-fitted sound system and accessories.

MyToyota Insurance also features a number of ancillary services, such as Road Assist, Home Assist, Medical Assist and Trauma Assist, while vehicle repatriation and assistance with legal advice, towing and storage are all part of the extensive service.

To get a quote and switch to this superior service, call 0860 98 98 98.

 

Credit Shortfall Cover

Things are never cut and dry. Comprehensive insurance covers the current retail value of your vehicle, not what you paid for it. Over time cars depreciate in value, so a year after you bought your car it might only be worth 75% of what you paid for it. So if you have paid off R20 000 of the original price of R200 000, you still owe R180 000, but the car might only be worth R150 000. If it is stolen insurance will pay you the retail value (R150 000), but you will still owe the bank R180 000, leaving your R30 000 out of pocket. You can, however, take extra insurance to cover this gap, usually called Credit Shortfall Cover.

 

What DOESN’T Comprehensive Insurance cover?

A friend of mine recently complained that his Comprehensive Insurance didn’t cover his car when it broke down, and herein lies a common misconception. Comprehensive Insurance covers damage to your vehicle caused by fire, theft or collision, and has nothing to do with mechanical breakdowns.

For mechanical breakdowns you need a warranty, but more on that later.

 

 

 

 

 

Tips

 

What does comprehensive insurance actually cover?

 

When most of us buy a car we need to finance it, which means that we borrow the money from a bank and pay it off over 60 months or so. One of the conditions of the bank approving our finance is that we have comprehensive insurance cover on the vehicle, so that if it gets stolen or damaged, the bank isn’t exposed to risk.

But what does comprehensive insurance mean, what does it cover, and why is it imperative that you don’t cancel your insurance while you’re still paying off a vehicle?

Not all insurance is created equal. Insurance brokers have different types of insurance, which generally include:

 

 

1. Third Party Only (TPO),

2. Third Party, Fire and Theft (TPFT),

3. Comprehensive

 

 

Third Party Only insurance is the most basic, and only covers damage suffered by ANOTHER person or their property, in the event of an accident that you are responsible for. So if you drive into someone else’s car, and the accident is your fault, TPO insurance will cover the costs to repair THEIR car, but not yours. 

 

Third Party, Fire and Theft adds another level to the insurance coverage. Like TPO, TPFT only covers accident damage to someone else’s vehicle. But if your car is stolen or hijacked, or even damaged or destroyed in a fire, TPFT will cover YOUR loss.

 

Comprehensive insurance

Comprehensive insurance is exactly that – comprehensive. It provides cover for almost any form of financial loss related to your vehicle, be it from an accident, theft, fire or act of God. And like the other levels of cover, it also covers damage or injury caused to a third party (other person) or their property if you are responsible for the accident.

Toyota actually offers their own comprehensive insurance product called MyToyota Insurance. It’s a premium insurance product that offers not only great insurance, but a number of added benefits. For example, all repairs are done by Toyota accredited repairers, which helps to retain your vehicle’s value. It also includes cover for accidental damage, theft and hijacking, as well as third party liability. Hail damage is also included, as is damage to your windscreen as well as the factory-fitted sound system and accessories.

MyToyota Insurance also features a number of ancillary services, such as Road Assist, Home Assist, Medical Assist and Trauma Assist, while vehicle repatriation and assistance with legal advice, towing and storage are all part of the extensive service.

To get a quote and switch to this superior service, call 0860 98 98 98.

 

Credit Shortfall Cover

Things are never cut and dry. Comprehensive insurance covers the current retail value of your vehicle, not what you paid for it. Over time cars depreciate in value, so a year after you bought your car it might only be worth 75% of what you paid for it. So if you have paid off R20 000 of the original price of R200 000, you still owe R180 000, but the car might only be worth R150 000. If it is stolen insurance will pay you the retail value (R150 000), but you will still owe the bank R180 000, leaving your R30 000 out of pocket. You can, however, take extra insurance to cover this gap, usually called Credit Shortfall Cover.

 

What DOESN’T Comprehensive Insurance cover?

A friend of mine recently complained that his Comprehensive Insurance didn’t cover his car when it broke down, and herein lies a common misconception. Comprehensive Insurance covers damage to your vehicle caused by fire, theft or collision, and has nothing to do with mechanical breakdowns.

For mechanical breakdowns you need a warranty, but more on that later.