Understanding Insurance for Used Cars in South Africa: A Practical Guide

Overview

Buying or owning a used car in South Africa brings specific insurance considerations: the type of cover available, previous claim history, write-off classifications and how insurers value salvage. This guide explains common policy types, what happens when a used car is damaged or written off, and pragmatic steps owners can take when deciding whether to repair or sell. The guidance is aimed at private owners and small fleet managers in Johannesburg, Cape Town, Durban and surrounding areas.

Types of cover and what they mean

• Comprehensive: Covers accidental damage to your vehicle plus third-party liabilities. Typically the widest protection but with higher premiums.
• Third-party, fire and theft: Covers damage you cause to others and loss by fire or theft to your car, but not own-vehicle accident damage.
• Third-party only: Covers damage to others only; your vehicle’s repair costs are not covered.

How insurers classify write-offs and salvage

Insurers may declare a vehicle a write-off when repair costs exceed a percentage of the car’s pre-accident market value, or when it is uneconomical or unsafe to repair. South African insurers use categories for write-offs; a vehicle declared a write-off often becomes salvage and may be sold at auction or retained by the insurer. If you buy a used car with a history of write-off or structural repair, ensure the insurer knows this - non-disclosure can void claims.

Repair cost vs value retained

Estimates above are illustrative ranges for South Africa and will vary by model, year and local labour/parts costs. Always get an insurer or reputable workshop quote for accurate figures.

If you want an overview of how selling a non-running vehicle works or the options available, see our Sell Non-Running Car page and learn how salvage and insurance outcomes can influence a sale.

When to sell vs repair

Choosing between repairing a used car and selling it for salvage or to a specialist buyer depends on insurance cover, repair cost estimates, residual market value and personal tolerance for ongoing risk. Consider the following factors:

• Insurance payout: If the insurer declares a write-off and pays market value, selling privately may not be possible without disclosure. Understand whether the insurer retains salvage or allows you to keep it.
• Out-of-pocket repair costs: If repairs exceed the car’s market value or a high portion of it, selling for parts or to a buyer who handles salvage may yield better net cash.
• Ongoing reliability: A repaired vehicle with structural damage may carry higher future maintenance costs and reduced resale appeal.

For a step-by-step view of how selling a damaged vehicle can work in South Africa, including free towing and paperwork solutions, read our About / How it works page.

How the process works (insurance and claims)

When damage occurs to a used car, the typical insurer workflow in South Africa is: notify insurer, arrange assessment by an appointed assessor, receive assessment report and repair estimate, insurer decides on repair approval or write-off, and then settlement or repair commences. Timelines vary but expect initial assessor contact within days; full settlement can take weeks depending on complexity and documentation.

Practical steps when making a claim

• Notify your insurer promptly and be honest about the vehicle’s condition and history.
• Keep clear photos and a damage log; these help assessors and any subsequent buyers.
• If you’re offered a write-off settlement but want to retain the vehicle, check the insurer’s salvage-retention policy and how that affects the payout.
• If the car is under finance, the finance provider must be notified; settlements are often paid to the lender first.

Damage types vs typical offer impact

Legal & paperwork in SA

Insurance settlements, transfers and deregistration carry specific paperwork in South Africa. If a vehicle is sold after a settlement, the owner must ensure transfer documents are correct and notify the insurer of any sale if salvage was retained. Vehicles under finance require lender consent for transfer or write-off settlement. Deregistration and transfer steps are covered by the Registrar of National Roads Traffic Act procedures; if you choose a specialist buyer instead of private sale, they often handle deregistration and paperwork for you.

Tips to maximise your outcome

• Get multiple repair and valuation estimates so you understand true costs and insurer valuations (quotes in R help with comparisons).
• Disclose prior repairs and claims when insuring a used car to avoid future disputes.
• If selling a damaged used car, prepare clear photos, service history and claim documents - buyers pay more for clean, verifiable records.
• For non-running or salvage vehicles, consider specialist buyers who offer free towing and paperwork help to reduce logistics and time costs; see our Sell Damaged Cars page for typical services available.

What happens after collection (if you sell or retain salvage)

If an insurer collects salvage, they will typically auction it or use it for parts. If you retain salvage and sell it privately or to a specialist, ensure transfer documents correctly note the vehicle condition. Buyers in the salvage market look for clear title, documented damage history and whether the vehicle was under finance. If you work with a professional buyer, they often manage deregistration and give a clear receipt for settlement amounts.

For a quick orientation to our process when you decide to sell a non-running or damaged car, our homepage explains the steps and what documents you’ll need: Sell Your Damaged Car - homepage.

Final note

Insurance for used cars in South Africa requires careful record-keeping and honest disclosure. When damage occurs, compare repair quotes, understand insurer decisions about write-offs and salvage, and weigh repair costs against the car’s market value. Practical preparation and clear paperwork preserve value and simplify claims or a sale.

Sources

• Financial Sector Conduct Authority (FSCA) - regulator guidance for insurers
• Ombudsman for Short-Term Insurance - complaint handling and dispute resolution
• AA South Africa - consumer advice on buying used cars and insurance basics