How insurers value used vehicles
South African insurers reference industry valuation guides (TransUnion AutoVision, Mead & McGrouther) to establish the value of used vehicles at policy inception and at claim settlement. The same vehicle has three published values: retail (price at a dealership), market (typical private-sale price), and trade (price you’d get trading in to a dealer).
The basis your policy uses determines settlement at write-off. A R300,000 retail-value vehicle has a market value around R275,000 and a trade value around R250,000. The R50,000 spread between retail and trade is the surprise drivers find at claim time when they assumed retail and the policy specified trade.
Retail, market, trade — which is right for you
Retail-value cover is the most expensive but pays out closest to replacement cost from a dealership. Best for drivers who would replace via a dealership purchase if the vehicle were written off.
Market-value cover is the most common default. Pays out close to private-sale prices. Best for drivers comfortable buying replacement vehicles privately or who have the means to bridge the gap.
Trade-value cover is the cheapest but the smallest payout. Genuinely problematic if the vehicle is financed — the gap to outstanding balance can be substantial.
Disclosure of used-car history
Insurers verify used-vehicle history through industry databases. Disclosure of prior accidents, repairs, modifications, and any non-factory equipment is essential at policy inception.
A vehicle with prior accident damage (even repaired professionally) may attract premium loading or specific exclusions. Honest disclosure is the only protection against decline if the same area of damage is re-claimed later.
When TPF&T or TPO start to make sense
For older used vehicles (15+ years, under R80,000 value), comprehensive cover starts to lose its economic case. The premium reflects ongoing risk pricing; the payout is capped by depreciated value. At some point the math favours TPF&T or TPO and self-insuring the smaller absolute risk.
The threshold isn’t precise but a useful guide: if your annual comprehensive premium approaches 15% of the vehicle’s market value, the comprehensive structure is becoming uneconomic. Covered in detail in our cheapest-cover guide.