Car scratch and dent insurance

You pay a premium, either monthly or as a single amount for a fixed term, and in return the insurer pays for a set number of minor cosmetic repairs during that term. Repairs are done by an approved network, usually technicians who come to you and use paintless dent removal or localised repair techniques rather than replacing and respraying a whole panel.

Claiming on it should not touch your comprehensive policy, so your motor excess and your claims record on that policy are normally unaffected. Confirm that with the provider, because it is one of the main reasons to buy the product at all.

The cover is almost always a short-term insurance product underwritten by a licensed insurer, frequently through a cell captive arrangement, with the dealer or administrator as the distributor. The insurer's name belongs on your schedule.

Wording varies between products, so treat this as the usual pattern rather than a rule.

The most important row is the size limit. Products define eligibility by measurement, and a dent slightly larger than the stated maximum is not a borderline case, it is simply not covered. Ask for the actual measurements in writing before you buy.

Four numbers decide whether the product is any use:

• The maximum value of a single repair
• The number of claims allowed per year or over the term
• The total rand value claimable over the life of the policy
• Any excess per claim, which some products do apply

There is normally a waiting period at inception, often around a month, and an inspection or photographic record of the car's condition when cover starts. Any damage already present is excluded, which is why the inspection matters and why you should keep a copy of it. If nobody inspected the car, take dated photographs of every panel yourself on day one.

Also check whether the cover follows the car if you sell it, and whether any unused premium is refundable if you sell early or settle the finance.

Pricing is indicative and varies by vehicle and term, but scratch and dent is a low-premium product in the same order as other dealer-sold add-ons rather than anything close to a motor premium. What matters more than the monthly figure is how you pay it.

Dealers frequently add value-added products to the finance agreement as a single up-front premium. That means the amount is financed over the term of the loan and you pay interest on it, so a product that looked like a few hundred rand can cost meaningfully more by the end. It also increases the amount you owe, which widens the gap between the settlement balance and the car's insured value in the early months.

Ask for the rand cost of the product on its own, and ask what the instalment would be without it. If the answer is vague, that is your answer.

It tends to earn its keep when cosmetic condition has a financial consequence. A car on a balloon payment or a lease you will hand back, where return condition is assessed, is the clearest case. So is a newer car you intend to trade in within a few years, a car parked in tight public parking every day, or a household with new drivers who will scuff bumpers.

It tends not to be worth it on an older, lower-value car where nobody will much care about a light scratch, on a car you plan to keep until it dies, or where the claim limits are so tight that one repair exhausts the cover.

A reasonable middle path: decline it at the desk, then price it separately afterwards if you still want it. Removing the time pressure of a signing appointment usually improves the decision.

Add-on products bought in a dealership finance office are still insurance, and the normal protections apply. You are entitled to full policy wording, not a brochure, and to know which licensed insurer carries the risk. Short-term policies normally carry a cooling-off right of at least 14 days from receiving the documents where no benefit has been paid and no insured event has occurred.

You cannot be required to buy an optional product to get finance approved. If you were told otherwise, say so in writing to the dealership and to the insurer. Cover you did not agree to, or that was never explained, is a conduct issue.

If a claim is rejected or badly handled, complain to the insurer in writing first and ask for reasons. If that fails, the National Financial Ombud Scheme South Africa (nfosa.co.za) will look at it free of charge. The NFO took over short-term insurance complaints from the former Ombudsman for Short-Term Insurance (OSTI) when the ombud schemes merged in 2024. Complaints about the advice or the sale go to the FAIS Ombud instead. Conduct is regulated by the FSCA, and insurers are licensed under the Insurance Act by the Prudential Authority.