Post includes an affiliate link to Naked Insurance.
This post is about how I reduced my monthly car insurance premium from R812 to R450 by simply getting a new quote. You might already be with a great insurance company who offers you a fair price, but it is unfortunately a reality that one needs to get new quotes for insurance or try to negotiate every now and then. So even if you can’t save money now, it’s definitely worth getting a quote as it’s only a 90 second process.
In fact, take a listen to Tebogo on how he found extra money in his budget.
I first heard about Naked when they commented on one of my Twitter posts. I liked their site but was a little apprehensive about doing a quote as I expected a long complicated process. I must admit I didn’t try the quote process on my first visit, but I did try it the following day. Good thing I did!
The quote process
The quote process was really easy! I just did in on my phone via the website (you don’t need to download the app just for a quote). There are fewer questions than expected and it takes a minute or two. It’s also great that you can specify a driver other than yourself (if you need to)
You get led through the process by a AI “bot” called Rose who asks you some personal details, details about the car and some questions regarding your insurance history. Was a lot simpler than expected!
After the final step you get your quote immediately and can then adjust your excess (see the post on insurance excess explained) and you can optionally add extras. If you’re happy you can simply confirm a starting date and pay by card.
Tip 1: If you are changing insurers select a start date which gives you sufficient time to cancel your current insurance (I selected the 1st of next month)
Tip 2: Make sure that the bank card you want to use is activated for internet transactions. Mine wasn’t so I just had to visit the bank.
It’s almost too easy, especially in comparison to some call centres and complex forms that I have had to deal with in the past.
So why is my new premium so much lower?
I decided to get in touch with Naked and asked Ernest North (one of the co-founders) some questions.
So why is my new premium lower?
“Our AI technology means that car insurance (and most claims) happens in seconds. Not only does it remove the frustration of dealing with call centre agents, but because we don’t have a manual process the cost saving means much lower premiums.”
I’ve never heard of Naked before and I’m scared to move to a new insurer, will Naked Insure really pay my claims?
“While Naked is an independent authorised FSP, our product is underwritten by Hollard Insurance Company. It means they get a small portion of the premiums and in return they guarantee that all valid claims will be paid, even in the years when catastrophe hits and the premiums we charged weren’t enough.”
The Pause Cover is a great feature, how exactly does it work?
“When you aren’t driving your car for a couple of days, you can save money by pausing your accident cover with a few taps on the Naked App.
We instantly refund you the accident portion of your premium for the rest of the month, which is roughly 50% of your premium.
You will still be covered for flood, fire, theft and any other stuff that can happen while your car is standing still (even runaway airport trolleys). When you want to start driving the car again, you simply reactivate the full cover with one click on the App.”
Cancelling my current insurance
I was a little nervous of cancelling my existing insurance and was expecting them to try to convince me to stay. To avoid an awkward phone call I simply mailed them requesting that they cancel the car insurance at the end of the month. Surprisingly, they responded within 15 minutes to say it was done. There was no need to negotiate or confirm my decision to move.
It might not always be so easy though so be mentally prepared for a negotiation from their side. Remember though that if they are suddenly prepared to lower your premium, then why didn’t they give you a better price right from the start?
Why I like Naked
Insurance often feels overly complex and although I have had really good service from my old insurer, I’ve always been a bit apprehensive about claiming. I always expect insurance companies to find some small little clause somewhere that will get them out of paying. I think there’s a general mistrust of the industry as a whole!
However, reading the website, using the app and chatting to Ernest has left me with a good feeling. It really seems as though Naked have made things as simple as possible and have set up their company in such a way that it doesn’t help them financially to not pay claims. Just watch the video on their home page.
Also, the quote process and the app are great! I’m a software developer so I love cool technology and this is really easy to use! I also love that I’m able to change my details, pause my cover, make a claim, contact Naked, etc – all through the app. Love it!
And finally, the “Pause” feature is awesome! I have used it a few times now and it’s literally money for nothing! Basically, when you know that your car won’t be driven for a day or more (eg you’re away for the weekend or you’re overseas) then you can “pause” your accident cover and save up to 50% off your daily premium. So let’s say your monthly premium is R600, that means that a daily premium is 600 divided by 30, thus R20 per day.
When you pause your accident cover you would save around R10 per day using our example. It doesn’t seem like much but you really do nothing for it; it’s just “free money”. Imagine a trip away for 14 day – that would be R140 free money at absolutely no cost or effort from you. And of course the higher your premium, the more you would save.
It’s a great concept and even though it may just be a few days here or there, I’ll take any savings I can get!
Insurance is a grudge-expense. I hate paying it and wish I had enough money not to have to worry about it, but it’s unfortunately essential to have. I’ve had to deal with my car being stolen when it wasn’t insured and that was a not a nice experience. Read up about my worst money mistake here.
Find an insurer that works for you. Compare prices, reputation and ease of use.
Don’t be afraid to make a change when you need to.
It’s your money, you make the decisions.