4x4 Insurance

[Mad Manny]

It's time we discussed the various options for 4x4 Insurance.

I'm hoping guys like HenriS, Emile Diesel Duiwel & Erin Imvubu will contribute greatly here.

Companies:
There are numerous companies you can approach.
Obviously, if you have half a brain, you look at cost weighed against benefits.

If you are a 'lowest cost wins' type, you are probably with Outsurance.

So there are many;
Santam
Cross Country
IWyze
Tru Grit (new)
Discovery Insure
The Douw Steyn Companies (A&G, 1st for women, Dial Direct, Budget etc - all offered under the Hippo)
Etc.

Packaging:
Of course, it's almost always better to have all your insurance together on one policy.
So then you have to look at how your insurer weighs up on the entire package - Vehicles, household contents etc.

I'll discuss mine in post #2, but I have all 4 with the same Insurer.

Generally it's cheaper that way. An insurer won't insure just a camera, or just a 4x4 - generally.

Broker or Direct?:
There's nothing better than a good broker.
There's nothing worse than a crap broker.
You can also go direct - in theory saving the brokers commission (see post #2)
Direct companies include Outsurance & Dial Direct.

Tracking systems?:
Most Insurers insist on the fitment of a tracking system.
Some people (Anti Vaxxers & Tin foil Hat wearers) object to this because in the 1980's these systems sometimes drained the batteries.
See Post #2 for my view

Overlanding:
IF you go into the neighbouring SADEC Countries (& beyond) you need to check to see to what extent your insurer will assist you.

[Mad Manny]

I'm personally with Santam.
They insure my Fortuner & my 6 company vehicles.
I also have business tools & household contents with them.
My CAR (Contractors All Risks) & Public Liability is with them too.

I use a Broker, Erin (on this Forum) his service is good.

I do review my stuff every few years - many years ago Outsurance tried to get my business - it was a long irritating process & in the end they were far more expensive - as in 30%.
They were rude & it was unpleasant.

I also let a well know 4x4 insurer quote, they couldn't match my Santam premium - even after I showed them my Santam policy schedule & premiums.

MiWay also quoted - useless.

I have Skytrax in ALL my vehicles - it's a very helpful business tool. I don't understand the opposition to tracking devices.
Even your phone knows you went to a strip joint - so if you think a tracking devise invades your personal space - buckle up...

[henris]

Let me chip in first.

Tuffstuff are the only ones that contact me directly and pay directly.

All the others have an angle.

Either you must get your car to a ZA port, on your own cost and they will take it to the closest place of repair. Or you get it to the ZA port and they will take it to where the car needs to go, of your preference.

Or they tell the client to arrange a quote to have a ballpark figure. Then give the client a hand full of cash and tell him he is on his own.

So yes, you need to make sure of what the fine print says.

Sent from my SM-J400F using Tapatalk

[Mad Manny]

Corona:
I must add, that during the 'Lock Down' Santam have been fantastic.

I heard that certain select Tuff Stuff clients were given a 30% discount on their premiums during Lock Down.

I spoke to Cross Country, they said they only offer a rebate on request & it's on a client by client basis - if you have a poor claims ratio, you are obviously getting zilch.

I'd like to hear your experience. Title posts regarding Corona Rebates with the word Corona (asI havedone) & keep it separate from the general Insurance discussion please...

I recieved a small rebate in May, about R900, then I got about R1600 back, then, for the past two moths, they've only deducted a portion of one certain premium - to date I've received nearly R12000 back - that's close to 2 months total premium.
Impressive!

[KurtG]

Southsure Brokers (underwritten by Infiniti)

I received about R1650 off in May because my insurer suggested I move one vehicle, the Metalian and the wife’s wedding ring to “household” instead of all risk. Of that, about R400 was a “Covid rebate” or whatever they called it.

When Danaë went back to work on 1 June we reverted back to normal and now I’m paying the same as before.

[Erin]

There are a few insurers that offer specialist off-road and/or cross border cover.

Cross Country and Tuffstuff are likely the most well-known (marketed), and in the absence of more information about Tru Grit (I've asked, they haven't responded), I'd venture that they (Cross Country and Tuffstuff) are the market leaders.

A few years ago I drew up a comparison of their products, and they are fairly similar. Both also offer a wide spectrum of other insurance products (for example, commercial or business insurance and personal insurance). I do find both tend to be expensive, when compared to the rest of the market (not always), but this can be attributed to the additional benefits they offer, over and above those offered on your standard policy.

Unfortunately, as brokers, we can no longer market the Tuffstuff product, as they contacted me several years ago and told me that they would no longer issue any new policies under our agency. I am aware of other brokers who have had the same experience.

This leaves Cross Country as our insurer of choice (they're in fact an underwriting manager or broker, not an insurer in their own right, but that's a discussion for another day) for client's who require the additional 4x4 and /or cross border etc cover.

Many of the other insurers have an add-on 4x4 endorsement or product, which can be tagged onto your standard policy, but these are limited in the scope of the cover that they offer. For example, they may extend the territorial limits of your policy to include additional countries in Southern Africa, or will automatically cover a winch, canopy, spotlights etc, but in my opinion, remain a distant second to the specialist insurers.

As mentioned above, one of the most important benefits of a specialist 4x4 insurer is the repatriation cover that they offer, and the network of service providers that they have established to provide cross-border assistance when necessary. Also of importance is the additional cover in respect of medical evacuations and similar. Keep in mind, that your insurer will not simply fly you home and recover your vehicle for you in the event of an injury or illness. They will first have you assessed by a professional, and will only evacuate you if circumstances deem it necessary and/or critical that you are brought back to South Africa.

In terms of the repatriation cover for your vehicle, most insurers do provide an element of cover for this, but you are expected to arrange and pay for your vehicle to be returned to South Africa, at which point their service providers will collect it. You can claim for the cost incurred in returning your vehicle to South Africa, and should be refunded (up to the limits stated in your policy).

[Erin]

On the Covid-19 topic...many insurers have recognized the decreased risks, and the hardships faced by their clients, and some have come to the party with various forms of assistance.

Santam, for example, allowed a 20% discount on motor premiums (which was paid as a refund). Additionally, they arranged a fund, which paid the premiums of certain (at risk or badly affected) clients, which were (supposedly) selected based on inputs from their brokers. In hindsight, I believe that they allocated this premium relief on a more-or-less random basis, and a little haphazardly, with some client's premiums for May and June being waived, and other's for June and July, and still other for just one month. At this stage we are still following up to check, but it appears that all the clients that we put forward as candidates for premium relief did receive it, to varying degrees.

Other insurers that we deal with either provided between 10% and 20% discounts (on the motor premiums), and those that use telematics, tended to base the amount of discount on the reduction in mileage. This is a good argument for the compulsory installation of tracking devices I guess, assuming that the devices installed are able to provide the insurers with the required data.

Generally, as a broker, I am not a big fan of tracking, mostly because the majority of my clients resist installing it, but, this week we experienced one of the very few occasions when a client's stolen vehicle was successfully tracked and recovered, although the issues with getting the vehicle cleared and uplifted from the SAPS impound yard almost make one wish that it hadn't been found. On the whole, my experience is that tracking causes more issues than it solves, especially when it comes to service levels, billing problems and so on, mostly the human factor, rather than the technology.

Edit: note the comparison I mentioned in my previous post was done some years ago and both insurers involved have since made changes to their policies, so there may be more differences n owe than there were at the time. When we were still able to deal with Tuffstuff, their service was very good, and Cross Country's still is.

[Mad Manny]

Thanks for your insight Erin...

[Erin]

Remember that commissions on short-term insurance are largely regulated, and may not be negotiated (up or down). However, many brokers and underwriting managers charge an additional policy fee which is (it has to be) reflected on your policy schedule. These fees vary greatly, and may be as low as a few Rands, or a percentage of your premium (the norm is around 10% of your total premium, but I have seen some charge as much as 20% (or even 25% in one case).

We do charge policy fees which are officially R35 for a personal policy and R50 for a commercial policy, but these are usually reduced to R10 or R20 respectively, or waived entirely.

Insurers may also pay an underwriting manager an additional fee, over and above the commission, for taking over various administrative functions, but these additional fees are also strictly limited.

We often refer to the loss ration on a policy which is effectively the ratio of claims paid vs premiums collected. The break-even point on a policy is generally a loss ration of around 65%, and the remaining 35% covers the insurer's reinsurance costs, admin costs etc etc. Therefore, if the loss ratio on your policy is less than 65%, your insurers are likely making a profit off you, and if it's over 65%, you are costing them money. In the short term, this is usually not an issue, although some underwriting managers monitor their book very closely, in order to keep loss ratios favourable and thus obtain better terms for the insurers, or realise better profits by way of profit-share schemes etc, and if you are covered by one of these, you may find yourself on the receiving end of a cancellation notice following a large claim, or a few claims.

When reviewing policies, insurers often tend to look at trends rather than single events. For example, you may have a big claim for a fire, or a written off or stolen vehicle which pushes up your loss ratio, but in many instances, several small claims will be viewed with more concern than a single large one, even though the small claims may total less than the large claim. This is because the insurers are seeing a trend of claiming.

I often advise my clients to insure against the disasters, things that will affect the bottom line for a business, or an individual's lifestyle and so on. Cover the losses that will have a major affect, and look after the small stuff yourself. This way you can reduce premiums by removing items from you policy, or selecting a higher excess etc. For example, we (my family) don't insure any jewellery, cellphones etc. I only cover my house (buildings), the contents of my house, and my vehicles plus my personal liability. Insuring a long list of specified items on an all risk basis doesn't make sens for me, particularly when taking into account the excesses payable in the event of a claim - I'd rather keep those premiums in my own pocket, and cover these smaller losses myself. I encourage my business clients to select an amount which they can comfortably cover themselves (usually around R10,000 to R20,000) and then to remove any item below this value form their policy, assuming that there is little or no risk of losing them all in one incident. The cost of replacing these items in the the event of a loss can be claimed back from tax anyway, as an expense, or through depreciation.

[Erin]

... and now that I've wandered completely off-topic

[Mad Manny]

Edit: note the comparison I mentioned in my previous post was done some years ago and both insurers involved have since made changes to their policies, so there may be more differences now than there were at the time. When we were still able to deal with Tuffstuff, their service was very good, and Cross Country's still is.

I heard that many Tuff Stuff clients have received various notices over the past 2 years restricting their cover.
I'm not sure what it entailed, so maybe one of the Tuff Stuff clients can add more detail.

[BushWacker]

... for Cross-Country , who cover my vehicle, it’s pretty much as Henri says ...
for Namibia, I carry the cost and the risk, whilst there,
and only on my return, they assess my claim on its merits ... at their discretion .
... Defeats the purpose actually ... the big exposures are:
if your vehicles stolen
Or involved in crash, wiping out another vehicle ...
etc etc
I’m looking at dropping international insurance cover altogether ...
and will downscale local cover too ...

[Samaya]

I have claimed too often or too big so my ratio is too big so didnt get discount. This is with Tuff Stuff. I dont have an issue with that and will stay with them. My premium is still lower than comparative quotes I got from Outsurance and Discovery.

Tuff Stuff requires Cartrack to be installed but include it in their premium.
When claiming, I get a quote from the company I want the work to do and they pay the money either to the company or to myself. I like it that way and I dont have to wait to have something repaired. Works for me.

[Ricof4e]

Everything I own is insured with Old Mutual and I use a Nambian Broker Mutual & Federal.

I prefer to work with a good broker and as Manny wrote, a good broker makes a massive difference.

For instance, back in 2018 the insurance premium on my Navara was R1,2k. I asked my broker to shop around and we got a quote for R980-00 from Outsurance. Out of his own accord, my broker took the liberty of negotiating with Old Mutual and got the premium down to R920-00. So I stayed with Old Mutual.

Come to think of it, in the past 9 years of insurance I haven't submitted one claim. I am one of those who prefer to claim only when it is absolutely necessary.

I am covered for SADC countries but do not have a tracker installed - first and foremost it was not a requirement and secondly there are about 7 vehicles stolen per annum in my region. Hell, the last time a hijack occurred in this region was back in 2016.

[HenriSteyn]

I am with Santam. Emile did a comparison for me to se if there are beter deals out there. He came up empty handed.

So far mostly weather damage claims with the storms last year. As expected they were very busy and delays were accepted.

All in all one of the best experiences at a very reasonable premium.

Cheers