Top Factors That Affect Car Insurance Rates in South Africa




Car insurance is the most important aspect of buying a new car. But, premiums are not the same for all drivers – and for good reason. There are many factors the car insurance company will take into account when determining a suitable automobile insurance premium.

This post takes a look at which of the following affects one’s car insurance premium and how this can be used to get a better car insurance quote in South Africa.

What Affects Car Insurance Rates?

insurance broker

Have you ever looked at your car insurance quote and wondered how the insurance company came to this conclusion? Well, they have to look at different sets of data that determine how much of a risk you pose to the company in question. Here are some of the data they use to determine their tailored quotations.


One of the first factors in question will be your area code. Some areas of South Africa have a denser population that will directly result in traffic congestion, accidents, and in the end – higher insurance claims.

Living in a metropolitan area will result in a higher insurance premium, versus residing in a small town.

Insurance companies will take the data they have gathered on the zip code in question, and determine other rating factors. These will include theft, crime, and claim amounts from that area, which will directly affect your premium.


The gender reflected on your legal documentation will play a role in your insurance premium. Male drivers pose a bigger risk to the insurance company, especially young drivers. Crash statistics show that men are more likely to be involved in a car accident and therefore will be more likely to file an insurance claim.

However, this will not remain the same across the board. When men reach their 30s, they might see a slightly lower premium when compared to their female counterparts.

Marital Status

Married individuals pose a decreased risk to the insurance company. They are labeled as less active on the roads, and more responsible than their single or widowed counterparts.

Married couples can even boast a discounted insurance rate when they combine policies.


A concrete rule in the insurance industry is “the younger the driver, the higher the rates”. Young drivers have been shown to pose a higher risk and are more likely to be involved in accidents.

Your premium can, however, drop by a significant amount once an individual reaches the age of 25 – given all other factors play in his or her favour.

old driver

Driving Experience and Driving Record

Your driving experience is a major factor when the insurance company determines your risk value. Less experienced drivers undoubtedly pose a larger risk than seasoned drivers.

The date on your driver’s license plays a larger role than age. A 50-year-old who has acquired their license 6 months prior poses a larger risk to the company than a 30-year-old who has been driving for 10 years.

Knowledgeable drivers are seen as more conservative and are less likely to be involved in accidents.

Your driving record will also be pulled, and this will reflect all parking and speeding tickets on file. If your record shows risky behavior, your premium will inflate.

Credit History

Those clients with a lower credit score will see a higher insurance premium. This is due to data that implies that bad credit owners are more likely to file larger claims. History has shown that they are more likely to participate in fraudulent claims or even miss insurance payments. This will reflect on the insurance company in turn.

Even though this practice is controversial, some insurance companies might hike up the premium by a large amount or even prefer that the insuree pay a lump sum upfront.

Claims History

A history of large claims will definitely play against you when looking for car insurance. At-fault claims will result in a higher premium and not-at-fault-claims may or may not.

Continuously large claims will cause you to pay not only a higher monthly premium but also a higher excess amount.

Previous Insurance Plans

Having continuous coverage, in other words, non-lapsing insurance policies will help decrease the monthly amount payable to the company. Studies indicate that those who have always had coverage are less likely to be involved in a car accident.

If you remain with the same company for a number of years, you might be eligible for a loyalty programme discount – depending on the insurer.

If you have been covered by someone else’s insurance, it would be best to disclose that information to the insurer. A lapse of coverage, however short, will most definitely result in higher premiums.

What Factor Affects Insurance Premiums the Most?

car service

The type of car you own plays a much bigger role in premium prices than you’d think. Here are some of the ways that your car purchase can affect your quote.

Car Model

The insurer in question will gather data on the vehicle model that will determine the cost of premiums. Some of these data sets include:

  • Cost of repairs
  • Price of purchase
  • Cost of service
  • Theft and break-ins
  • Accident rate
  • Sensibility and safety tests
  • How Will the Car Be Used?

This seems like a strange question, but it’s an important one. If the car is purchased for the intention of low-mileage commutes and personal commutes, the monthly premium will be lowered.

If you intend to insure a car that will be used for business reasons, it would be best to disclose the information immediately. Cars meant for business use have additional coverage options that personal cars don’t have. The coverage will be more, but it’s due to the fact that they pose a larger risk to the insurance company.

business car

Insurance Coverage Options

We have car insurance options to choose from when we insure a vehicle. Minimum coverage is often too limited to fully assist the insuree in the event of an accident.

There are policies and fine print that must be read before deciding on the correct coverage. It may be best to opt for a fuller coverage option that will lower the excess amount payable and help comprehensively when the need arises.

Some aspects of a policy to keep in mind would be:

  • Liability
  • Comprehensive and collision
  • Medical benefits
  • Safety

How will the vehicle be stored? This may seem silly, but an unsafe environment will greatly impact the risk evaluation by the insurer. If the vehicle is parked behind locked gated, whether inside or outside, the insurer might be prompted to lower the monthly premium.

A safer parking area will decrease the risk of the car being stolen or broken into, therefore lowering the likelihood of a claim.


The higher the annual mileage, the higher the risk to the insurance company. If you commute via densely populated areas, the risk of being involved in an accident highly increases.

Extra mileage on the vehicle will also mean that additional services and repairs might have to be done on the car This most certainly increases the monthly premium.


Insurance premiums will inevitably increase, regardless of other factors. Repairs, services, and other players in the game are all susceptible to inflation and this is something that no one can escape.

A certain percentage of inflation will have to be expected, regardless of the other factors mentioned.

Not Everyone Is Insured

girl in car

However disappointing this might be, we are charged a higher premium due to the high-risk, uninsured drivers on the road. Research indicates that only a fraction of the population is insured and this poses danger to the insurance company.

About 70% of drivers are uninsured. And with 800 000 accidents on South African roads annually, drivers are more likely to be involved in an accident with a person who is uninsured.

Which of These Drivers Is Most Likely to Pay a High Insurance Rate?

We’ve listed the less desirable insurance factors, but here’s a quick summary of them.

  • New drivers
  • Men under the age of 25
  • Drivers with a car deemed “unsensible”
  • Drivers who are considered older
  • Those whose insurance policies have lapsed
  • Those who live in high-risk areas
  • Drivers of cars who are deemed to be high-risk for theft
  • Drivers with extra mileage
  • Unmarried drivers
  • Those who have low credit scores
  • Drivers who have made many insurance claims
  • Drivers with a bad driving history

Factors That Affect Car Insurance – Control What You Can

There are many car insurance factors that will forever be out of your control, but there are some that you can take charge of. Try to control your premiums by reducing your risk factor.

Don’t partake in risky behavior and don’t get parking or speeding tickets. Most importantly, shop around for insurance coverage. Each company evaluates risks differently, so make sure to get options from as many insurers as possible.

And a final suggestion, try to get re-evaluated at least once or twice a year, especially if you’ve reached a milestone birthday.

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2 responses to “Top Factors That Affect Car Insurance Rates in South Africa”
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