OVERCOMING RISING MOTOR INSURANCE COSTS

The motor insurance market has faced a myriad of challenges in recent times, with the cost of repairing accident-damaged motor vehicles experiencing a substantial increase. 

As a team of professional insurance brokers, Genesis Insurance is dedicated to helping consumers navigate these changes and find the most suitable insurance solutions. 

In this blog post, we will explore the factors contributing to rising motor insurance costs and how partnering with professional insurance brokers can help consumers overcome these issues.

Factors Influencing Motor Insurance Costs

Increased repair costs

Across the motor insurance industry, there has been a significant increase in the cost of repairing accident-damaged motor vehicles over the past several years, ranging from 10% to 35% depending on the type of vehicle and parts required.

This upward trend in repair costs has placed pressure on insurance companies to increase premiums to account for these higher expenses.

Inflation in parts pricing

A primary influence driving the increase in repair costs has been inflation in the pricing of vehicle parts, ranging from 15% to 25% over the past few years.

The higher costs of parts, from fenders to computer chips, mean that insurance companies have to pay more to repair damaged vehicles. These parts price hikes are passed onto customers in the form of higher premiums.

Global shortage of semiconductor chips

The inflation in parts pricing has also been attributed to a global shortage of semiconductor chips used in new motor vehicles. 

Slowdowns in production during Covid-19 and the war between Ukraine and Russia, where many raw materials for vehicles are sourced, have constricted supply. With demand increasing as economies reopen, limited supply has led companies to increase prices.

Shipping delays

In the aftermath of Covid-19, demands for vehicle parts have surged, yet shipping delays have constrained supply.

The resulting impact has been longer timelines to repair vehicles, straining costs associated with vehicle rentals and other expenses during the delay period. Insurance companies have had to account for these additional costs in the premiums charged to customers.

Vehicle theft

A significant factor influencing the rise in average motor insurance claims and premiums has been an exponential increase in vehicle theft over the past several years.

The higher incidence of theft, and associated costs, has led insurance companies to increase premium rates to offset the greater risks and expenses.

As these factors continue to put pressure on the South African insurance market, it is essential for consumers to work with professional insurance brokers who can guide them through the complexities of motor insurance and ensure they have the most appropriate coverage.

The Value of a Professional Insurance Broker

Expertise and Knowledge

Genesis Insurance Brokers possess in-depth expertise and knowledge of the South African insurance market. Our team of professionals is well-equipped to understand and analyze the factors affecting motor insurance costs and can provide tailored advice to help consumers find the most suitable insurance policies that meet their unique needs.

Access to a Wide Range of Insurance Products

As professional insurance brokers, we have access to a vast range of insurance products from various providers. This enables us to source the most competitive and comprehensive policies that address the specific concerns and risks associated with the current market conditions.

Negotiating Competitive Premiums

In the face of rising motor insurance costs, it is vital for consumers to ensure they are getting the best value for their money. At Genesis, we leverage our relationships with insurers to negotiate competitive premiums on behalf of our clients, helping them secure the best possible coverage at the most affordable price.

Claims Assistance

In the event of a motor claim, our team at Genesis provides ongoing support and assistance to ensure a smooth and efficient claims process, helping our clients navigate the complexities of motor insurance claims and working to secure a fair and timely settlement.

Ongoing Support and Advice

As the South African insurance market continues to evolve, we are committed to providing ongoing support and advice to our clients. We regularly review insurance policies to ensure they remain relevant and aligned with the current market conditions, and provide updates and recommendations as needed.

How Can We Help?

Our team of experts is dedicated to providing tailored advice, competitive premiums, and ongoing support to ensure our clients are well-protected in the face of challenging market conditions. 

If you are looking to review your motor insurance coverage or explore new policy options, contact us today to discuss your needs and discover how we can help you navigate the complexities of the insurance market.