Considered the bare basic insurance for vehicles, third party car insurance is exactly what it says it is – cover that will pay out for accident damage to another person’s vehicle in case the accident was your fault. What about your car? Well, that is why third party car insurance is so cheap – your vehicle is not covered. If you want accident cover for your vehicle then you will need comprehensive car insurance. And if that is too expensive then some companies offer an in-between policy compromising third party insurance along with theft and fire cover for your vehicle, which can be termed basic car insurance. But do not write off third party car insurance – it is actually a very important, albeit minimal, car insurance cover.
Who should take third party car insurance?
Ideally every vehicle on the road should have third party car insurance. Over 60% of vehicles on South African roads are not insured. Yes, there are millions of drivers without car insurance for their vehicle. It is not a perfect world and as long as car insurance is not mandatory in South Africa, there will be people who will continue driving uninsured vehicles. Third party insurance is for everybody but if you have comprehensive car insurance then it is essentially has third party cover within it. So does a basic car insurance with third party, theft and fire cover.
The standalone third party car insurance suits people who are on a very tight budget, have an older vehicle for which they do not want to pay the more expensive comprehensive car insurance. It is ideal for students driving Mom’s old car or the elderly on a tight budget. However, third party car insurance is not suitable if you have a vehicle that is still under finance. It is mandatory to have comprehensive car insurance for any vehicle that is still being paid off so do not even consider third party cover on its own. In fact you could be breaking the terms of your finance agreement by not having comprehensive car insurance if you still have a car loan to pay.
Cost of Repairing Third Party’s Car
You may feel that you can afford to repair your car in the event of an accident but have you ever factored in the cost of repairing somebody else’s vehicle? You are liable for these costs if the accident is your fault. What if you damaged more than one car in the accident? The age old argument that “my car is a junker and cheap to repair” is not going to help you when you are liable for tens of thousands of rands worth of accident damage repair for the other person’s vehicle. Even worse, if you were responsible for an accident where a very expensive car was damaged, then you could be looking at ridiculous sums of money that could cripple you financially for years to come.
Yes, car insurance of the other person will pay for the repairs for their vehicle immediately after the accident. But the car insurance companies will recoup the costs – from you. This only happens if the accident was your fault. With third party car insurance, at least you can rest assured that you are only out of pocket for your car. Third party cover will pay for the costs of damage to the other person’s vehicle irrespective of whether it was a cheap or expensive car. It is a form of financial protection that ensures that you are safe against the recovery of these costs although these policies do not pay for your vehicle repairs.