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With the launch of Discovery Insure, the company started competing in the short-term market. Not unsurprisingly, the financial services firm has put together incentives such as 40% rebate on fuel costs.

The main features of the new product are as follows:

• Clients have to insure at least one vehicle comprehensively and can add buildings, contents etc.

• Discovery wants to make people better drivers. Each insured vehicle will be equipped with a tracking device (“DQ-Track”), which will not only measure the position of the vehicle, but also your driving behavior.

• Clients can subscribe to “Vitality Drive” for which you get rewards for improving your driving style.

• You can get a refund of up to 40% of your fuel costs at BP petrol stations only.

• You have to do an annual car check up at Tiger Wheel and Tyre, do online questionnaires etc. to prove that you are a responsible driver.

Advantages of Discovery’s offering

• Fuel cost refund (limited to R 1000 p.m. maximum spend)

• Heavy accidents will immediately trigger an emergency signal through the tracking device to Discovery to respond to the accident.

• Car hire is automatically included.

• No excess payable if you are not at fault (theft, hijacking, hail, storm or fire).

• Roadside assistance included.

• SmartService is aimed at providing a hassle-free car claims experience.

• A smartphone application can be downloaded to assist you with motor claims.

• Boosted Vitality and Discovery Credit Card rewards

• The fuel rewards can be allocated to an excess funder account. The funds can be used to offset your excess in the event of a car claim.

• The “All Risk” section gives you the “estimated maximum loss”, which means you do not have to specify all the articles to take away from home.

• Contents over R 750’000 must be valued free of charge before they can be insured.

Disadvantages of Discovery’s offering

• All claims are handled via a call centre. There is no broker involvement at all.

• The policy is not ideal for drivers that accelerate fast, brake hard, go fast through corners, drive at night / weekends and travel long distances.

• No commercially owned policies are possible.

• Funds from the excess funder account can only be withdrawn after 3 years.

• Only monthly policies are possible.

• You have to sign a consent form so that Discovery can share information with other insurers or use it for credit checks.

• Unlike other insurers, your policy cancellation period is 30 days.

• A copy of the police report is necessary to process certain claims. Knowing the level of service of SAPS, this might create delays in handling a claim.

• Vehicles will only be covered comprehensively once inspected by Discovery. Until then the cover will be 3^rd party only.

• Cars cannot be insured by telephone on short notice (e.g. on a Friday afternoon), due to the processes involved.

• You have co-payments if you use providers out of Discovery’s network, such as repairs to windscreens, towing services etc.

• If you have an accident outside the borders of South Africa, you are liable to get the vehicle to the border, thereafter Discovery will pay for the towing/transport.

• Foreigners must have a South African driver’s license within 12 months of having become a permanent resident.

• Personal liability is only valid in South Africa.

• The DQ could be used in the event of an accident and your claim could be repudiated if you were speeding etc.

• If your house is unoccupied for more than 60 days, you have to apply for cover and Discovery could decline insurance cover.

Comment

We have analyzed the policy benefits and welcome Discovery’s offering – it is a new approach to the insurance market and brings in new elements. It is certainly aimed at the motor insurance market and no real differences were brought in regarding contents and buildings insurance.

The policy will only suit policyholders that fall in the category of responsible drivers. The proposition suits drivers that have a BP station nearby and that use the Discovery credit card.

For more information or a quote, please contact our short-term insurance department or Mr. Kenny Williamson.