8 ways to reduce your car insurance premiums

Financial services company Alexander Forbes has released its latest insurance claim data on South African motorists.

According to the statistics, the average claim for youth drivers aged 18-25 in the 2017 financial year was R40,976, up from R36,055 in 2016.

The average claim among young drivers show cabriolets to have the highest average claim amounts, followed by coupes, SUVs, hatchbacks, and sedans.

The top three had averages of between R50,000 and R70,000 per claim, with hatchbacks and sedans averaging R37,000 per claim.

BMWs, Mercedes, Jeeps and Minis had average claim amounts of more than R45,000, and were the top youth-driver brands in this category.

Despite this brand favouritism, the data found that 70% of the drivers in this age category are driving hatchbacks – 30% of which are Volkswagens.

According to Colin Mchunu, senior manager at Alexander Forbes Insurance, insurance companies generally classified young drivers as high-risk due to their lack of motoring experience.

“Because youth are more likely to have an accident in the first year after getting their driver’s licence than at any other time in their motoring career, this results in this category being charged higher premiums.”

On average under 25s pay about 30% more than drivers over the age of 25, he said.

“The likelihood of a young, relatively inexperienced driver being involved in accidents is high owing to among other factors, driving at higher than the regulated speed limit and risky driving behaviour.”

Mchunu suggested that for younger drivers to reduce car insurance premiums they need to:

  • Drive a vehicle with a small engine;
  • Upgrade safety features – Keep the vehicle in a garage and install a tracking device for stolen recovery purposes;
  • Limit their mileage;
  • Install a tracking device for stolen recovery purposes;
  • Find an insurance package with driver behaviour telematic feedback that helps improve driving habits;
  • Build up a good claims track record – The better your claims history the more you are likely to save on insurance;
  • Elect to pay a higher excess as higher excess will result in lower premiums, but make certain you can afford the premium in the event of a claim;
  • Don’t ‘pimp’ your car – aftermarket changes to the engine or body can end up costing you.

“In addition to the above another good way to keep risk down is to enhance the security features of your car, and consider taking defensive driving courses,” said Mchunu.

Read: 20 of the cheapest SUVs and crossovers in South Africa right now

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8 ways to reduce your car insurance premiums