Google
RSS Feeds RSS | Views on ITInews | contact | terms of use | privacy 
 


Editorial Categories:

FINANCIAL SERVICES
ADVISERS & BROKERS
BANKING & BONDS
BUSINESS MANAGEMENT
COLUMNISTS
CONSUMER AFFAIRS
CRIME & FRAUD
ECONOMY & GLOBAL
EDUCATION & TRAINING
ESTATES & WILLS
HEALTHCARE INSURANCE
INDUSTRY & LEGISLATION
INSURANCE
INVESTING
LEGAL AFFAIRS
LIABILITY INSURANCE
LIFE INSURANCE
MARKETING
PEOPLE & COMPANIES
POLITICS
PROPERTY
RETIREMENT PROVISION
REVIEWS
ROAD ACCIDENT FUND
SHARES & UNIT TRUSTS
SHORT-TERM INSURANCE
TAXATION
TECHNOLOGY
VIEWS & LETTERS


Forthcoming Events:

No Upcoming Events


Available Recruitment:

No Vacancies Listed...


Save by getting insurance quotes


Your Editor, Brent WilsonInforming Consumers and Financial Advisors since 1988 | Click Here to Advertise
Fairest car insurance ever - with Hollard it's sorted
Press Offices > Short Term Insurers

Hollard Insurance
Press Office Feature : Less Risk means Less Premium – and ‘experience’ gets a break

Company: Hollard Insurance
Author:Erik Harkema
Email:[email protected]
Posted:26 Aug 2007

 Email this article Comment on this Article  Print this article

Response to the letter from an ITInews reader

The writer of this letter certainly raises legitimate and significant concerns about the state of our roads which should be a concern to all South Africans, particularly drivers, and we all need to get busy and do what we can to lobby for this to be sorted.

But let’s talk about the insurance issues raised

Age And Experience:

From an insurance perspective, road conditions and driver behavior obviously affect the accident rate.  From Hollard’s point of view, experienced drivers with a good track record, whose skills help to cope well with all driving hazards and road/weather conditions, do benefit in the underwriting process and premium calculation. 

The novelty and additional bonus of Hollard’s Pay As You Drive concept is that thanks to GPS technology, we are also able to adjust the premium depending on how much mileage a person does.  This means that given two drivers with the same level of experience, Hollard’s Pay As You Drive will charge a lower premium to the one who drives less.

Save When On Holiday: 

This also means if a person takes an extended holiday without their car, their premium will be less during that period.  Why should they pay the same premium while not driving their car on our risky roads – described so well by the writer?   

Changes: 

But it is interesting to note that changes in South Africa mean that the ‘inexperienced’ driver is no longer only in the 18 to 25 year age group.  Hollard’s records show that ‘inexperienced’ and ‘first time’ car owners can now be 35 to 45 and older which means ‘age’ is no longer the key to experience from a driver risk point of view. 

SA vs UK:  

We’re not quite sure why the writer raises the subject of the UK, but an interesting point is that because of our high crime rate in South Africa, the fact that a tracking device with all the standard security features is included in the Pay As You Drive ‘package’ is a very appealing benefit for South Africans.  In the UK, however, where the crime rate is lower the inclusion of the tracking system isn’t such a selling point or attraction to buyers of insurance.

The Risk / Premium Link: 

Concerning Hollard’s Pay As You Drive concept, the ‘drive less pay less’ concept is mainly  about how much time a person spends on our roads and therefore how much time that person is exposed to the ‘risk’ of having an accident. 

So, if a person spends ten minutes driving to work and back each day, their risk is much less than a person who spends two hours or more a day driving in the conditions described very well by the writer.  All the driving conditions described so clearly help to highlight why those who spend less time on our roads deserve a fair break when it comes to insurance.

Business Loading: 

An extra benefit brought about by the ability to accurately monitor mileage is that no ‘business usage’ loading is charged with Pay As You Drive.  This business usage loading can be as high as 30% but with Pay As You Drive the focus is on how far you drive and not why you go there. 

In addition, quite a few business people have company cars and a privately owned vehicle, sometimes used for business.  So their private car no longer has to be insured to include a ‘business use’ loading on the premium. 

We encourage more people to be involved in drawing attention to things that need sorting and compliment the writer of this letter for getting involved and caring to take action. 

Keep a safe following distance!

Erik Harkema is the Manager, Actuarial Team, Hollard Insurance

Comments:
There are no comments at this stage. Be the first to comment!
Please Login To Comment On an Article - Click here To Login

ITInews invites comments at the foot of each of its articles in which readers can respond freely - anonymously if they wish - to various topical issues and industry debates. However, comments submitted by readers that are defamatory or deemed, by the editors, to be racist or obscene will be deleted from the database. Furthermore, ITInews's editor would like to caution potential posters on its websites that while it welcomes robust debate, it will not hesitate to make the IP addresses of the authors of such defamatory statements available to the authorities, in the event of a court order compelling them to do so.



Get car, home, life and business insurance quotes in 3 easy steps


Hollard Insurance


Join us today

More from Hollard Insurance
Protecting your Pocket and Sanity comes Standard with a Home Warranty
Professional property inspectors is the first step towards peace of mind
Technology makes business loading on motor insurance a non-issue for low mileage users
Many business people are in fact clocking up fairly low kilometres
FGA now wholly owned Hollard subsidiary
Preparing for imminent launch of Black Empowerment entity, Etana
Stop photocopying insurance solutions that don’t fit Africa
Like snow damage cover on the equator, says Hollard’s Israel Muchena
Hollard provides free online toolkit to get BEE assessment sorted
A dramatic simplification of procurement reporting
Hollard is the first South African insurer on Wikipedia
Quantum leap into the future
Hollard has a new CEO at the helm from July 1 2007
Well equipped to navigate innovative courses ahead
Hollard launches ‘medical aid’ for motor cars
An ethically transparent extended motor warranty with clearly defined benefits
Mothers have the vaccine for the ‘gimme-that-now’ epidemic
What kind of adult am I trying to help my child to be when they are big?
SA’s hospitality industry lags behind global standards in insurance and emergency preparedness
Take charge of risk rather than merely having the risk dictate the premium


Archived Articles featuring this company ...


Insurance Quotes


Car Insurance Quotes
Household Insurance Quotes
Business Insurance Quotes
Funeral Insurance Quotes
Life Insurance Quotes

Read the InsuranceQuotes Blog
ITM Website Design Cape Town
Copyright © 2005 - 2015 ITInews Online Publications (Pty) Ltd. All rights reserved Insurance Times & Investments Online and ITInews. ..::ISSN 1995-1256::.. No part of the materials including graphics or logos, available in this Web site may be copied, photocopied, reproduced, translated or reduced to any electronic medium or machine-readable form, in whole or in part, without specific permission from ITInews Online Publications (Pty) Ltd. Distribution for commercial purposes is prohibited.