It appears that many people are travelling with the Gautrain on a daily basis, and this number is set to increase!

What will the impact be of increased accessibility to quality public transport in Gauteng?

I would like to share a few observations I have come across in the budget speech delivered by Ismail Vadi, MEC of Roads & Transport Gauteng. He made a few very important points in his speech on public transport and I would like to focus on some of them.

• Impact and importance of Public Transport

“It should be evident to all of us that our public transport system impacts in a very real way on the lives of our citizens; no less than the provision of education or the rendering of health services. It has become an issue of intense public interest and concern. It is precisely for this reason that the Gauteng ANC, at its Provincial General Council held last week, resolved that an affordable, safe and reliable road and public transport network, based on an overall transport master plan, are essential for a vibrant global city-region.”

• Traffic Volumes on Roads in Gauteng

“At the same time, traffic volumes on our roads are extremely heavy. In total, 66 million vehicle-kilometres – that is the total distance travelled by all vehicles in one day – are travelled by about 4 million cars every day on the roads in our province. This totals to 24 billion vehicle-kilometres annually. Over half of the provincial roads in Gauteng carry more than 5000 vehicles per day and 38 percent of the roads carry more than 10 000 cars per day.”

• Need to preserve and Repair the Road Network

“These facts say something to all of us. It says that we must act quickly and decisively to preserve our road network. The Department, therefore, has taken a strategic decision to focus on repairing, maintaining and rehabilitating our roads, rather than focusing on constructing new roads. This we must do to guarantee safety to our motorists; and to minimise the excessive road reconstruction costs that we will incur over time if we neglect to repair them timeously”

• Public Perception and Impact of Gautrain on Public Transport

“A public survey conducted in February this year shows that people in general are very positive about Gautrain. The opinion survey shows that:

- Gautrain is seen as improving and transforming public transport;

- its leadership is seen as having the ability to compete on an international level;

- 80 percent of respondents indicated that they are likely to use Gautrain; and that it has a positive, distinctive and recognisable brand perception.

Will improved Public Transport affect Car Insurance needs?

What is quite clear from the above comments is that Government is committed to providing and improving quality public transport. There is a need to reduce traffic congestion by improving public transport facilities and services, and an understanding that the success in doing so will enable thousands more to commute via train and buses.

As thousands of commuters may enjoy the benefits of public transport, many will travel less in their personal vehicles and may also seek to adjust their car insurance policies to that of policies developed around a Pay As You Drive structure.

We would like to invite vehicle owners to investigate the benefits of Pay As You Drive Car Insurance.

Related posts:

1. Pay As You Drive car insurance to benefit from changing work environment
2. Do I really need travel insurance?
3. Changing jobs could change your car insurance premium

Car insurance should also be able to recognize owner and driver individuality by the way in which premiums are calculated. Car Insurance should never be a one size fits all  – if you pose less of a driving risk and claims risk than your neighbour, you should pay less in car insurance compared to your neighbour.

In this post we would like to pay attention to one of the aspects that could reduce the distance driven and as a result – the claims risk!

Changing Work Environment, reduced driving and PAYD

It is generally accepted that the more and the further you drive, the more exposed you are to both accidents and vehicle loss! You share the road with more road users and road hazards and despite your own driving ability there are simply so many more threats.

Why is the work environment changing?

Advances in technology and increased connectivity are allowing professionals and businesses to interact 24/7 with one another without the need for long face to face discussions around a table in a fancy office. The internet has become faster, the cost of data has come down and with laptops, iPads, smartphones and other devices information can be shared swiftly and effectively.

It has also allowed many to move away from the corporate environment to do their own thing! It is not only the “stay at home moms” who discovered the benefits of working from home. Tax consultants, financial advisors, marketing professionals and many more are finding that they are well capable of building and maintaining a business on their own.

The internet and 24/7 online connectivity are allowing for many new businesses. Many of these businesses are web –based and can be managed from the office at home.

How does the changing environment impact on travel patterns and car insurance?

Many vehicle owners find that the changing work environment allows them to reduce their travels significantly. Small business owners find that they can often avoid hectic traffic congestion into the city by optimizing their homes into “home-offices”.  Not only can they save on expensive office rental, but also on the costs of transportation.

These costs include:

-Petrol

-Vehicle maintenance and service costs

- Costs of wear and tear of tyres, brake pads etc

- Costs of parking etc

It is most important to recognize that these savings should also extend beyond the above list to include your car insurance. If you drive less, a Pay As You Drive insurance policy will reward those drivers who drive shorter distances than other drivers. Those who work from home are likely to benefit from such a policy.

How much will I save with a Pay As You Drive Car Insurance Policy

As earlier indicated – every premium is based on your own driving behaviour. To find how much you will save there is only one way to find out – request a car insurance quote and compare this to what you are paying now!

You might find that you may not only smile at reduced traffic congestion- but also at a reduced car insurance premium!!

Related posts:

1. Is the Gautrain changing travel patterns and car insurance needs?
2. Pay As You Drive Car Insurance could protect the environment
3. PAYD could benefit from increased usage of public transport

We have discussed on the car insurance blog the terms Pay As You Drive, Usage based insurance etc. We also predicted that as vehicle telematics becomes more advanced – the insurance industry is likely to include the benefits of this technology in their insurance product design.

Earlier today I came across interesting insights on the Moneyweb website in a story titled “Santam’s big-brother device”

This story featured some revelations made during the results announcement of South Africa’s largest insurer, Santam.

I would like to quote:

“If Short-term insurer Santam’s experiment pays off policyholders could get a discount of up to 15% on their premium payments.

The insurer is experimenting with a driver behaviour technology that monitors the speed, time and places an insured policyholder drives to.

The product won’t be suitable for those who consider it as a “big brother” device but will help those prepared to examine their risk behaviour on their vehicles. For those interested the product can be added on to an existing insurance policy.

“I think what’s quite interesting is we are experimenting currently with some driver behaviour technology. The device is not just to assist in the recovery of the vehicle for theft and hijackings, but it also monitors the driver behaviour. It indicates whether speed is being exceeded, whether driving takes place at an unusual time and also manages the amount of kilometres covered,” Santam CEO Ian Kirk said following the company’s interim results on Tuesday.

“That I think could innovate quite a lot in terms of being able to reduce premiums giving credit to policyholders who practice good risk management. We will phase it in over a period of time… we anticipate about 5 000 sales in the year. That is not substantial in a Santam context, but it will give us substantial coverage to see if this is viable,” he added.

The monthly charge for the product would be around R160 and people would get premium discounts of around 10-15% after a device is installed in the insured car. On the direction of motor insurance premiums this year, Kirk said there will be some selective increases depending on risk profiles, but across the board it will not be over 5%.”

It is expected that many more insurer will benefit from the use of vehicle telematics. Later this month there will be an Insurance Telematics conference in Europe where industry leaders will provide more insights on the latest technology and how this is about to change the insurance industry!

Also view:

Vehicle and Insurance Telematics

What is Insurance Telematics and how will it impact on Car Insurance?
Vehicle Telematics boosted by interest in Pay As You Drive Car Insurance

Related posts:

1. Better public transport will also deliver an opportunity for cheaper car insurance premiums!
2. Effective history checks could provide cheaper car insurance premiums
3. Do women deserve cheaper car insurance premiums?

This decision will affect how many insurers conduct their business – especially the “women only” insurance companies. I doubt whether such a finding can be made as there is in my opinion much statistical data providing evidence as to why women drivers should qualify for cheaper car insurance premiums!

Data on car insurance claims has revealed that there is a lesser risk of insurance claims from women drivers. Women are seen as “safer and more mature motorists”. The car insurance premiums for women are both cheaper and decrease with age at a faster rate than men’s.

On this Blog we have previously tried to identify why women are submitting fewer accident claims, and I would like to quote

“I believe that the testosterone driven male species might pose a greater accident risk as a result of the following contributing factors;

* Over-confidence

* Showing-off

* Excessive speeding

* More instances of drunk driving and late night driving

* Greater vulnerability to road rage etc

I am also convinced that the lower risk posed by female drivers could be as a result of:

* Driving shorter distances

* Driving at lower speeds

* Greater responsibility in transporting children in urban areas

* Less driving late at night and whilst intoxicated

* The ability of many non-permanently employed women / stay-at-home moms [not many nowadays] to structure their driving away from rush hour and dangerous areas.”

It is most important for women to know that if they are driving a lot less than their male counterparts – they could benefit from car insurance products that are developed around the use of their vehicles!

Usage based or distance based car insurance products such as Pay As You Drive recognizes that less driving amounts to less risks and therefore qualifies for reduced car insurance premiums.

Irrespective of whether the European Court finds that women only car insurance is discriminatory or not – there will always be cheaper car insurance for those who drive less!!

It might be a good time to reflect on your driving behaviour and find a car insurance product that reflects that behaviour!!

Also view:
- Do women deserve cheaper car insurance premiums?
- Does cheaper car insurance imply women are better drivers?
- Why do some car insurers focus on women only?

Related posts:

1. Does cheaper car insurance imply women are better drivers?
2. Elderly women are higher risk drivers for car insurance
3. UK Study reveals women drivers still struggle with parallel parking

What are these proposed amendments?

Draft Amendment 19 is published in Government Gazette 33979 of 1 February 2011- It deals with SAP clearance documents and the marking of new vehicles after 1 July 2011 with microdots. The amendment is out for comment until 1 March 2011.

What is Data Dot Technology?

Data Dot technology is a passive anti-theft security system which is supported by insurers and is applied as spray film invisible to the eye over the entire vehicle. This technology can be described as a simple and effective theft deterrent system. Based on the reliable identification of key component parts of the vehicle, the vehicle is of reduced value to a professional thief. The thief is only interested in vehicles where they can easily change their identity or strip for parts.

The spray contains millions of dots, each smaller than a grain of sand, which are etched by laser with a unique alpha-numeric code (which can be fully customised). This code can only be read with a special scanner that utilises a strong UV magnifier to read the code.

Also view:

Microdot Technology and Car Insurance

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The Wikipedia definition of an accident:

“An accident is a specific, unexpected, unusual and unintended external action which occurs in a particular time and place, with no apparent and deliberate cause but with marked effects.

It implies a generally negative outcome which may have been avoided or prevented had circumstances leading up to the accident been recognized, and acted upon, prior to its occurrence.”

Everyday citizens try to keep away from physical harm and accidents. We do not plan to be involved in an accident and have no desire to witness accidents either.  Every now and then we are unfortunately caught in an accident.

We would like to share a video of a “close call”. If ever anyone needed a reminder to check their car insurance cover as well as life and disability cover – the lady in this video most certainly did!!

Also view for more insights on Insurance:

Insurance Chat

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I could not resist using this photo of a traffic officer which appeared quite a while ago in “Die Burger” newspaper. Most people would use this photo in a story about traffic enforcement or speeding fines. I would rather like to reflect on another aspect – responsible driving and avoiding heavily congested roads.

In recent months there has been an increased focus on efforts to reduce congested traffic and CO2 emissions. We have discussed on this blog how Pay As You Drive Car Insurance and GPS technology could assist in avoiding congested traffic.

The advantages are clear:

-          Reduced time spent in congested traffic

-          Less pollution from vehicle emissions

-          Less frustration and road rage

-          Savings in both time and costs of fuel

An important aspect often overlooked is the many fender bender accidents and car insurance  claims caused by frustrated motorists in congested traffic.

Car Insurance companies are now rewarding motorists who “drive clever” by enabling them to pay less for car insurance premiums. This is made possible through the following Pay As You Drive options:

-          The basic odometer reading revealing reduced distances travelled

-          The more advanced option of tracking technology also providing data on where, how and at what time you are driving!

By driving clever and paying more attention to where, how, what time and even how we drive we might save significant amounts of money – and we might even allow our traffic officers those precious moments of sleep ….They might have less need for speed enforcement and even allow us to avoid those nasty Traffic Fines!!

Related posts:

1. Escalating petrol prices will force vehicle owners into review of insurance costs as well!
2. How much does it costs to book for a theory and practical driving test?
3. Driving with lights on can reduce car insurance claims

Some vehicle claims are easier to explain to the car insurance company than others!! It is best accepting that insurance is not meant to provide cover for blatant stupidity…Vehicle owners have to take reasonable steps to protect their insured vehicles!!

Leave driving on seasand for 4×4 vehicles and trained 4×4 specialists!!

Also view:

4×4 Sand Driving Safety

4×4 Driving and Vehicle Insurance

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Santam, which has the largest portfolio of personal, commercial and agricultural insurance clients in South Africa, expects that claims from damage will continue to increase as the country, and in fact the world, experiences among the worst rainfalls recorded in years.

“Climatologists and meteorologists expect wet weather to continue well into March and even April,” says Shehnaz Somers, head of personal lines underwriting at Santam. “This is a cause for concern, especially for those that have not insured their property or vehicles, or those who have under-insured their valuables to save on insurance premiums. The danger of under-insuring your property and vehicle is that the payout, when claiming, can be less than the replacement value.”

“We urge South African’s to speak to their broker or insurer, to ensure that the amounts insured are correct.”

According to Santam, only 35% of South African drivers insure their vehicles, which is an alarmingly low number.

“Suffering flood damage to a home or vehicle, and not having insurance to cover your loss could very well cripple a family financially. Loss relating to flood damage is covered as part of most comprehensive cover policies, and although claims are assessed on the exact circumstances under which they have occurred, the potential outcome of such a loss is always easier to deal with when you know that your insurer will cover your loss,” says Somers. – I-Net Bridge

Also view:

Does car insurance cover flood damage?

What is Household insurance and does it cover water and flood damage?

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The devastating floods in Queensland state that forced evacuation in Brisbane, Australia’s third-largest city, are expected to be a near $1 billion event for insurers, though reinsurance is seen covering more than half of it.

That would mean the flood cost to insurers would rank along with the Perth and Melbourne storms last year and the Victorian bush fires in 2009, data from the Insurance Council of Australia showed.

In the first estimates of insurance claims tied to the floods, that are seen shaving up to 1 percent off GDP,
Queensland state’s top insurer Suncorp said reinsurance protection would limit its costs at up to A$90 million.

“The reality of it is, the event is so big that it is some one else’s problem now. It is over to the reinsurers,” said Paul Biddle, a fund manager at Celeste Funds Management, which owns Insurance Australia Group
shares.

Analysts said the reinsurers impacted included General Reinsurance, Swiss Re , Munich Re (MUVGn.DE) and Lloyds of London .

“The market will get some sense now,” Biddle said, referring to the more than 10 percent drop in Suncorp shares in the past month on fears of mounting claims.

Shares in Australian insurers were all higher on Thursday, with Suncorp up 0.6 percent, rebounding from a five-month low hit on Wednesday. IAG shares were up 1.6 percent in afternoon trade.

CLAIMS SO FAR

IAG said it has got 2,400 claims so far from the events tied to southeast Queensland and 1,200 due to heavy rains late last year in the state, which would cost it up to A$30 million.

While IAG said it was too early to assess the impact of the floods in Brisbane, analysts put the number at well below the reinsurance trigger of A$150 million.

Other insurers, who play a meaningful role in the region include QBE Insurance , Allianz and RACV
Insurance. These insurers have not commented on the claims and the total cost is based on the average of four analysts’ views.

IAG should be able to meet its insurance margin forecast of 10.5 to 12.5 percent and still have about two-thirds of its A$300 million weather-related allowance left for the half year for future events, the analysts said.

IAG has said it has a natural peril allowance of A$435 million for the year and it would use up to A$140 million in the six months to December.

Analysts, who raised their earnings forecasts by between 5 and 10 percent last week for IAG, said they would shave off half of it after IAG’s announcement.

While reinsurance protected a cost blowout for Suncorp, it surprised investors with a A$120 million cost to reinstate reinsurance cover. This forced analysts to cut already narrowed forecasts by a further 10 to 12 percent.

The reinsurance reinstatement would give Suncorp cover for a further two events between now and June,
analysts said.

(Reuters – Reporting by Narayanan Somasundaram; Editing by Sonali Paul and Dhara Ranasinghe)

Also view:

“Video captures scene as vehicles are swept away by floods in Australia”

What is flood insurance in Australia?

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