Right, so you’ve been tempted to buy a bargain of a car that has been in an accident and declared a write off by the insurance company. Or your own car has been in a bad accident and has been repaired professionally to a high standard and you would like to have it re-insured. But the problem you face is that you now have a car that has been declared Code 3 by insurance and your “coded car” will not be insured easily.
The problem with a Code 3 Car and Insurance
Many insurance companies are reluctant to insure a code 3 car as the standard that it has been repaired to varies and as such, it could be a liability in itself. Whilst it’s true that you coded car has to be road worthied and fit for use on public roads, who’s to say that it does not carry some sort of undetected defect as result of the crash? No doubt the vehicle was exposed to some tremendous forces when it was hit and even if the air bags didn’t fire off, it could be hiding a hairline fracture in a strut or wishbone. So it’s understandable that insurers are hesitant – but obviously you have found an exception and assessed the risk and are prepared to go ahead and buy the car.
Now their are a few insurance companies (Santam and MiWay) who are prepared to offer Code 3 car insurance – but they mostly pass the risk back to you by stacking the odds in their favor by doing two things:
A) They inflate the premium – around the 20% mark:
B) They won’t insure at full vehicle value – mostly about 70% of normal book value.
This would mean that you have found a car that offers incredible value, but will cost about the same to insure as a new or second hand car. This is definitely not ideal, so do your maths carefully when it comes to this purchasing decision. That and the fact that you cannot get vehicle finance for a Code 3 car, means you will probably be buying it cash or from the funds of a personal loan. You might want to consider one of Prime Meridians insurance options if you’ve used cash to finance the Code 3 car, as their insurance options might work out better in the long run.
Get your Code 3 Car Insured at Full Replacement Value
The Good news! There is a car insurance company that will insure your car at full value and it’s not one of the big car insurance companies. The company is called CIB Insurance and you can get a quote from them using the details below. As with all things related to car insurance, your personal risk profile is everything – so best give them a call to find out what they can do for you.
CIB Insurance Brokers
Tel: +27 (0)11 455 5101
CIB (Pty) Ltd is an Authorised Financial Services Provider (FSP No. 8425) Underwritten by Guardrisk.
What’s the difference between a Code 2 and Code 3 car?
A Code 1 car is a new car. A code 2 a used car and a Code 3 is a car that has been written off as accident damaged and rebuilt. Quite often it’s possible to get a Code 3 car at a very reasonable price but insuring it can be more expensive than you anticipated. This article should have help you get cheaper and full value car insurance for a Code 3 car.
Further Reading about Insurers that can help with Code3 Cars.
Santam calculates the market value of such vehicles at around 30% less than auto dealers, and the premium is usually loaded by around 20%.