Are you planning to carpool? Check with your insurance company first – Laws and insurance products

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The state of consumer finances in South Africa deteriorated in the second quarter of 2022. This is according to the ial Vulnerability Index (CFVI), which indicates that consumer finances are back in a very exposed state. And Johan van Tonder, an economist at Momentum, speculated that this significant drop could well be attributed to sharp increases in fuel and food prices, load shedding, rising interest rates and weak economic growth.

In this context, the popularity of carpooling to work has increased considerably. However, consumers are strongly advised to carefully check the conditions of their car insurance to ensure that they will not have any unpleasant surprises when making a claim with their insurer.

Most of us hate having to make that call or send that email for fear of having to pay even more for insurance coverage than we do. But in a scenario too often referred to lawyers, some customers prefer to avoid checking with their insurer in hopes that they won’t have an incident that causes loss or damage.

If Murphy’s Law hits though, you’ll have put yourself in a corner, and many will then twist the facts to their insurers, hoping they don’t get caught. Insurers are competent to validate facts and information when claims are submitted – and they should be, in order to protect the group of insured consumers they cover. If you are found to have lied to your insurer, not only will your claim likely not be paid, but your policy may be canceled by your insurer – you will need to disclose this to any other insurer you contact for coverage. Insurers are generally unlikely to provide you with cover if your policy has been canceled by another insurer under these circumstances.

It’s always best to make that call and keep your insurer informed. Instead, pay a little more premium now and have peace of mind that you’ll have coverage when you need it.

As for the mode of carpooling, avoid doing it for profit as much as possible, because it considerably changes the risk, the premium and the other conditions of coverage. The extent of your liability to those you transport will also be greater.

The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.

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