Many people ask why they should take out a retirement annuity. Well I’m going to give you a few reasons why you should.

According to a survey done on working people who have reached the retirement age of 65, 47% are dependent on relatives; 31% are forced to continue working or take up second careers; 16% are dependant on a state pension, which is in the region R820 per month and only 6% are financially independent.

There are all sorts of other trends that make it essential to start planning well in advance for your retirement. Some of those trends are:

What is the difference?

Well I am going to run through a few differences for you. People have their preferences but it is nice to have a choice.

Firstly, the most obvious difference is that with a direct insurance company you handle everything yourself.

What to look for when shopping for short term insurance (household or vehicle) has always been unfamiliar territory for a lot of people, especially with the younger generation. Obviously older people have experience on their side because they would have learnt a lot of life lessons and information over the years.

Here are some insurance terms you should know about and what they mean.

Short term insurance terms:

Excess – The excess on your policy the basically first payment due on the repairs of your vehicle. It is your responsibility to pay the excess. Usually you would pay the excess to the repairer that fixes your vehicle when it has been in an accident. When shopping for insurance a lot of insurers will raise your excess with out telling you although they need to tell you by law. Some insurers have a fixed excess while other charge a percentage of the claim. Some insurers have an excess waiver. This is where you would pay a little more monthly and not have to pay an excess at claim stage.

What is Third Party Cover?

Third part cover is the third type of insurance cover. The other 2 would be full comprehensive cover and third party fire and theft cover.

Third party cover basically only covers you for the third parties damages should you be involved in and accident and proved to be your fault. It is a good type of policy to take out if you have an old vehicle and are not too worried if it gets stolen or damaged. You would take out this type of policy so that you are at least covered for the other vehicle.

What is third party fire and theft cover?

Third Party Fire and Theft is the second type of insurance cover. The other two types of cover are Full Comprehensive Cover and Third Party Cover.

Third Party Fire and Theft cover is a bit cheaper that full comprehensive cover obviously because it covers you for less. On third Party Fire and Theft cover you are covered for:

A lot of people that I have run into over the years still do not know what to do in the event of a vehicle accident. Here I am going to go over the basics of what should be done when you have a vehicle accident.

Please remember that depending on the severity of the accident your involved in the things I am going to run through are not always possible.

They call it a no claim bonus but it’s not an annual bonus that you get back in a lump sum. It’s basically a discount on your premiums. The more high risk you are the more you pay monthly. This is so that the insurance companies can cover the risk. If you are a low risk client then it’s more worth their while to insure you.

You need to have had full comprehensive insurance throughout the number of years you’ve been insured to qualify for a no claim bonus.

Why do I have to pay an excess if I was not at fault?

A Question many people ask. So here is a few reasons why…

The main reason for an excess is so that the insurers can eliminate most of, or if not all of, the minor or small claims. If you have an accident and the damage is say R500. To submit a claim to the insurance company it could cost the insurer that amount just on administration charges. Therefore they add an excess to the policy to avoid such minor claims.

What is full comprehensive insurance?

To explain full comprehensive insurance I need to mention all the types of policies, there are 3.

• Full comprehensive
• Third party fire and theft
• And finally third party cover

Full comprehensive insurance is the first type of insurance. It covers your vehicle for basically any type of damage. The only things that are not covered are Acts of God or negligent damage. Negligent damage is damage caused by the owner of the vehicle through negligent acts like drinking under the influence of alcohol or racing. This needs to be proven though. Acts of God would be things like earth quakes and hurricanes.