Inflation is on the rise in South Africa; however, there has been an increase of 13.8% in car sales over May 2021. SUVs were the best sold segment, while bakkies and LCVs did not do so well. According to the Automotive Business Council, 39.177 vehicles were sold last month.

This means a gasp of air for an industry that suffered a great blow with the COVID-19 pandemic. Also, the recent floods caused damage to the supplies of the Toyota company. This adds turmoil for an industry that is actually facing rising costs, higher interest rates, and problems with the supply chain.

The vast majority of this sales were made to dealers, but the other sector that bought many cars in 2022 is car rental industry. The sales of this sector represented 10% of sales.

With the rise of gas price and a depreciated Rand, the economy is in the midst of an inflationary crisis. People are finding it harder to get by, and so they turn to the market for cheaper cars. For this reason, the car sale industry is offering bakkies, and SUVs which are fuel-efficient and more appealing to the people’s pockets. With a car that uses less gas on average, they can save quite a considerable amount of money. In times of soaring inflation, cutting down expenses is of the utmost importance.

Of course that as prices are on the rise, this is no different in the insurance market. However, you should under no circumstance cut out your car insurance completely. If you are finding it hard to pay for your car insurance, what you could do is find other reliable but less expensive car insurance providers. Also, you could think of downgrading your insurance for a while until you are up on your feet again and go with your regular insurance. The monthly cost of owning a car has increased considerably, but there are options you could consider.

You could consider using a car insurance calculator to find the best deals for car insurance. These useful online tools allow you to compare prices and benefits. Remember that in car insurance, there are different levels of coverage. The more coverage you get, the higher the premium. However, the lower the premium, the less money your insurance will cover. This means that you need to carefully consider a balance between what you pay and what you can get.

Depending on the insurer, there are different plans you can opt from. However, the most common are Third-party insurance that will only cover for damages you cause to others. Comprehensive insurance that will also cover for damages caused to your own vehicle. Between these two general plans, there will be benefits that you can add for greater coverage.

What kind of insurance you should buy will depend on your budget, how you use your car, and so on. For instance, if you rarely use your car, and you live in a quiet area, you might not need the same level of insurance as someone living in a busy city and who drives the car most part of the day. Talk to your car insurance advisory to find the coverage that best suit your needs and your pocket.

The inflationary crisis is making it difficult for South Africans to get by. Soaring fuel prices have meant an increase in prices of everything else: cost of living, rent, food, insurance, etc. Hopefully, the country has recently undergone the fifth COVID-19 and the government did not need to enforce lockdown restrictions that would have damaged even further the economy.

In order to navigate this crisis, it is important that you make a budget and prioritize your expenses. As it was already said, cutting out your car insurance is not the way to go. There might be other activities that are draining your money, such as eating out, for instance. You might want to reduce those expenses until the economy of South Africa gets back on its feet.