Car Insurance in South Africa is a subject of short term insurance, but what is short term insurance? The best way to describe it is to distinguish it from long term insurance. Long term insurance refers to life insurance and investment policies that will pay out when a specific event takes place, i.e. the insured reaches a certain age or dies.

Short term insurance provides cover against the risk of loss or damage of one’s possessions such as your house, car and other belongings. Short term insurance also includes personal accident, third party liability claims and medical insurance. Short term insurance usually operates on a yearly basis, each year you need to review your insurance and renew the policy should you so choose. Premiums are usually paid monthly.

Short term insurance is regulated by the Short-Term Insurance Act, no 53 or 1998 and various other acts such as the Financial Advisory and Intermediary Services Act.

Car Insurance in South Africa offers various products to suit the individual needs of car owners. The high accident rate on South African roads coupled with a high crime rate makes car insurance a necessity, although it is not compulsory. Car insurance policies have a number of conditions and exclusions and it is very important to know what your specific policy stipulates. The conditions and exclusions differ between insurance companies and also depend on the severity of the risk.