Off-road car cover is the name used for specialized car insurance packages for 4×4’s and other off-road cars. These cars have become increasingly popular over recent years and are no longer used just by those wanting to travel off the beaten track. Off-road, or 4×4 cover as some insurance companies call their product, will cover your 4×4 whether you are driving in the city or in remote areas. As it is a specialized car it requires a different insurance product suited to the special needs of the 4×4 owner.
Off-road cover is comprehensive and includes all the benefits that usually form part of a comprehensive car insurance package. It will also include benefits that do not normally form part of other car insurance policies. This insurance will not come cheap, neither does the 4×4.
Apart from accident, theft and third party claims, some of the benefits that are different from other car policies include the following:
- Damage to the vehicle is covered at retail value plus accessories (accessories usually at an additional charge.)
- Off-road cover.
- Passenger, contingency and unauthorised passenger liability.
- Replacements of locks and keys.
- If there is a total loss within the first year of cover, the car will be replaced with a new one.
- Damage to third parties for up to R2.5 million.
- R5 000 cover towards medical expenses.
- X-country trials, rallies and repatriation costs.
- Your spare wheel and cell phone.
- Cover applies in South Africa, Namibia, Botswana, Lesotho, Swaziland, Zimbabwe, Malawi, Mozambique, Tanzania, Kenya and Madagascar.
Please note that amounts and benefits will differ between insurers so check your own policy carefully to ensure you have the cover you want.
The internet has made it very easy to obtain car insurance quotes from a number of car insurance companies, even all at the same time. This service is convenient as you can do your investigation into car insurance on your own time when it suits you. Another big benefit of the internet is education – now you can learn all the terms insurance agents use and become very knowledgeable on the subject.
You can either go to the individual insurance companies’ websites, or you can go to a broker’s site, or what is called an Insurance Aggregator Website. Here you will be able to complete your basic details only once and then you will receive quotes from a number of car insurance companies. This way is a great time saver. The various companies will call you to discuss the quotes with you – take your time to make sure you buy the product that is right for you, not just the one with the lowest price.
Many insurance companies offer you a claims service on the internet. You can download and print a claim form but it must be faxed to the insurance company as they require your signature by law, also to prevent fraudulent claims. Some even have a claim tracking system online where you can follow the progress of your car insurance claim.
The operating costs or operating expenses of a car insurance company is basically the everyday expenses that have to be made to run the car insurance business. This will include the costs involved to obtain new car insurance business such as advertising and marketing, as well as commission paid to insurance agents and brokers for introducing new business to the insurance company.
Operating costs also include administration cost such as the salaries paid to staff that process the new insurance business, processing of claims and renewal business. The operating costs are eventually paid for by the insured clients as it is included in the monthly insurance premiums. Insurance companies need to keep their operating costs under control otherwise the price of car insurance could become unaffordable to the man in the street.
When the term “overheads” is used it refers to that part of the administrative costs which cannot be allocated to any specific car insurance activity (for example claims or new business.) However these overheads are required for the basic operation of any business – think of items such as rental for the building from where the insurance business is run, electricity and water, communication costs such as telephone and computer systems.
The Operative clause in an insurance policy sets outs the circumstances that must be present before an insurance company will pay out any claims to insured parties. This clause is therefore very important as it forms the essence of the policy contract and details the scope of the cover.
The Operative clause will stipulate the insurer’s obligations; one can refer to it as the insurance company’s promise to the insured. It will include words to the effect of “subject to the terms, conditions, limitations and exclusions set out in the policy, and upon prior receipt of the premium, the insurer undertakes to indemnify the insured against any loss or damage in case of the occurrence of an Insured Event.” The insured event in the case of car insurance could be the car being stolen or damage suffered after an accident.
It will also set out the insured parties obligations in terms of the contact, including the payment of the premiums on the specified times. In insurance the onus is on the insured to provide proof that a loss did take place, following the general rule of the law of evidence and procedure. This rule is applied throughout the policy, including in the operative clause.
Optional cover refers to all the additional items that you can add to your basic car insurance cover. Basic (or essential) car insurance will be sufficient if you have a low value, old car. Basic car insurance includes third party, fire and theft cover. When you drive a higher value car or one that is financed you will need comprehensive car insurance that include accidental damage, fire, theft, hijacking and third party cover.
Optional cover are all those special “add-on” items for example your car sound equipment; off-road use; car hire (should your car be stolen, hijacked or damaged in an accident); credit shortfall cover (that will cover the outstanding amount on your loan should your car be stolen or written off); business use; roadside assistance; medical emergency assistance; towing services and many more. There could also be add-on benefits from optional cover that has nothing to do with your car insurance, such as home assistance in the form of emergency plumbing, electrical work or the services of a locksmith. Legal and trauma services could also be included in optional cover.
Many of these optional cover items are included when you take out comprehensive car insurance. Check your policy for details.
When taking out a car insurance policy it is very important to read and understand the terms, conditions and exclusions that are covered (or not covered) under your policy. One such term is other drivers. Make very sure what your policy states about other drivers driving your car when the insurance is taken out is your name. If you are unsure of the wording ask your insurance company for an explanation.
In most cases other drivers using your car, on occasion, will also be covered under your car insurance policy, without being mentioned by name, but only if they had your express permission to do so. Should someone drive your car without your permission and is involved in an accident your insurance company will insist that you lay a criminal charge against this person, which you cannot withdraw at a later stage. If you are not prepared to do so the insurance company will not consider your claim for the accident.
Don’t ever allow anyone without a valid driver’s license or someone under the influence of alcohol or drugs to drive your car. The insurance company will not even consider your claim under these conditions. See also the glossary item regarding named drivers.
The term “other parties” in insurance can refer to any other person or institution involved in an insurance contract. If you take out car insurance you may decide to work through an insurance broker. In this case the insurance broker will be one the parties involved in writing the insurance business on behalf of the insurance company. The insurer (insurance company) and the insured (person who applied for insurance cover) forms the two main parties to the insurance contract.
The word parties can refer to anyone dealing with insurance, even the Insurance Ombudsman. In the case of a business the owner will also be an involved party.
The term “other parties” is most often used in the wording of insurance contracts when referring to third parties (people outside the contract.) For example, if you have third party car insurance and you are the guilty party in a car accident, your insurance company will indemnify you against claims from the other parties – person(s) in the other car(s) involved in the accident. Insurance will cover the claims against you for injuries or death as well as damage to their property. Other parties could also be pedestrians that suffered injuries in the accident, or the owner of a parked car that you damaged in the accident.
In relation to car insurance out of pocket expenses will be the expenses that are not reimbursed after a car accident for example – it represents the expenses that the insured party will have to carry himself. The excess that is payable by the insured will form part of the out of pocket expenses. The term also refers to expenses incurred and paid for by and individual relating to one’s employment or business that can be claimed back from the business.
Out of pocket expenses can also include the cost of running a car, such as petrol, service and repair costs.