RSS Feeds RSS | Views on ITInews | contact | terms of use | privacy 

Editorial Categories:


Forthcoming Events:

No Upcoming Events

Save by getting insurance quotes

Proudly South AfricanInforming Consumers and Financial Advisors since 1988 | Click Here to Advertise
Car, household, life and business insurance quotes

News Article : Bridging the uninsured gap
Category: Short-Term Insurance : Motor Vehicle
Author:Edited by ITInews
Email:[email protected]
Posted:23 Feb 2016

 Email this article Comment on this Article  Print this article

South African insurers have called on the government to start compulsory motor cover

Jonathan Holden, Managing Executive: Insurance at Innovation Group South Africa, delves into the issue of uninsured vehicles within South Africa, as well as how to bridge this gap.

Vehicle insurance offers peace of mind and, more importantly, restores assets that will otherwise be destroyed or lost because of the great cost of replacement or restoration.

It is crucial for motorists, who are in the process of creating wealth and a lifestyle for their families, to realise that insurance is the safety net, keeping them from being knocked back to square one in the face of an unfortunate event.
With that said why is it that the majority of South African motorists have neglected to insure their vehicles?

Figures indicate that approximately 70% of the vehicles on our roads are uninsured, which has a significant impact on the insurance industry.
Innovation Group believes that the current state of the South African economy could be the reason motorists neglect this insurance.

As the economy constricts and disposable income comes under pressure, the average consumer places vehicle insurance lower on their list of priorities.
Cost implications
Insurance is about numbers - the greater the pool of contributors, the less the contribution is likely to be.

Given the current situation, the premium pool is shallow, as only 30% of motorists are paying premiums on a monthly basis. In order to deal with this issue, premiums are hiked.

Notably, the ability of insurers to recover losses of their policy holders, where incidents involving uninsured vehicles occur, is severely diminished.
In order to reduce the cost to motorists and companies, South African insurers have called on the government to start compulsory motor cover.

This is suggested as a way to create more value for insurers and insured drivers, as they currently face the country’s millions of drivers taking to the roads without protection.

Although some progress has been made in this regard, it is still some way off.
Bridging the gap
Innovation Group believes that insurance products should be tailored more uniquely to meet specific consumer needs and demands.

Some products, like “Pay As You Drive”, are perfect when it comes to catering to various risk profiles.

Another crucial point to consider is to improve the ability to develop, price and deliver a service in a short space of time, using mobile technology – this will ensure that the industry remains relevant in a digital world.
Consumer education should also be a major focus of insurers, as an awareness of risk might sway people’s decisions and guarantee that insurance is a priority for them.

This could come down to education about the importance of insurance from as early as primary education.
The key focus should be to drill down into the root cause of the insurance gap – whether it has to do with education or financial situation.

Finding ways to ensure that all demographic groups are covered by the products on offer needs to be a goal for all insurance companies.

Eatia:compulsary car insurance (17.05.2016 11:30)

Please Login To Comment On an Article - Click here To Login

ITInews invites comments at the foot of each of its articles in which readers can respond freely - anonymously if they wish - to various topical issues and industry debates. However, comments submitted by readers that are defamatory or deemed, by the editors, to be racist or obscene will be deleted from the database. Furthermore, ITInews's editor would like to caution potential posters on its websites that while it welcomes robust debate, it will not hesitate to make the IP addresses of the authors of such defamatory statements available to the authorities, in the event of a court order compelling them to do so.

Get car, home, life and business insurance quotes in 3 easy steps

Join us today

Insurance Quotes

Car Insurance Quotes
Household Insurance Quotes
Business Insurance Quotes
Funeral Insurance Quotes
Life Insurance Quotes

Read the InsuranceQuotes Blog

Short-Term Insurance
Crime Statistics
Global Sustainability
Health & Accident
Motor Vehicle
Personal Lines
Regional Insurance Market
Risk Management
Short-Term Underwriting

More in Short-Term Insurance
Mounting Concerns about Failure of Kariba Dam as El Nino Bites
Risk Management
Region faces shutdown of hydro-electric plants and collapse of mining industry
Digital business and digital adversaries
Risk Management
Organisations must invest in three risk disciplines to increase trust and resilience
Proper validation of motor assets key to progress in SA insurance sector
Motor Vehicle
Insurers must look to remove mis-priced risk
Fleet management vs. asset recovery
Motor Vehicle
No system can do everything perfectly
Insurance Mobile Applications no help to clients when they really need them
Auto insurance apps score best - majority of all apps lack functions to register and track claims
New advancements to reduce motor premiums for consumers
Motor Vehicle
Premiums to be based on actual risk
Southern Africa needs a regional insurance market
Regional Insurance Market
A frustratingly inconsistent approach to the way in which covers are arranged in each country
Insurance heads speak out on climate change
Risk Management
A larger role for enterprise wide risk management
A new era dawns for global insurance industry
Global Sustainability
Plan, predict and act with confidence and certainty in an ever changing world
Profound changes coming to insurance industry
Risk Management
Growing systemic risk a crucial issue for the insurance industry
Vodacom Business assists Santam in their Safer Driving Campaign
Motor Vehicle
Deal includes LiveTrack vehicle tracking system and safer drivers to get refunds
Flooding and Tyre Safety
Motor Vehicle
What does this mean for car owners?
The cost of technology on motor vehicle insurance
Motor Vehicle
Selecting the correct insurance cover on your vehicle remains fundamentally important
Short-term insurance association supports healthy competition in the vehicle security market
Motor Vehicle
Vehicle crime no longer the biggest challenge facing motor insurance
Aviation insurers in danger
Grave difficulty in trying to enforce exclusions and warranties
RSA crash – Possible overloading to blame
Insurers will not accept liability if the flight is in breach of Air Law
Losing the ball at the breakdown
Motor Vehicle
SAMBRA gives notice that its members want payment before releasing repaired vehicles
SA policy wordings problem
In the UK you can’t contract out of your negligence, while in RSA we can
Car rental industry – a response
Motor Vehicle
Do not plug ordinary commercial transactions into regulated environments where they do not belong
Hertz letter to editor, ITInews - Response to article “It hurts with Hertz”
Motor Vehicle
Hertz does not sell insurance

Available Recruitment:
No Vacancies Listed...

ITM Website Design Cape Town
Copyright © 2005 - 2015 ITInews Online Publications (Pty) Ltd. All rights reserved Insurance Times & Investments Online and ITInews. ..::ISSN 1995-1256::.. No part of the materials including graphics or logos, available in this Web site may be copied, photocopied, reproduced, translated or reduced to any electronic medium or machine-readable form, in whole or in part, without specific permission from ITInews Online Publications (Pty) Ltd. Distribution for commercial purposes is prohibited.