Posted by: Question | 2013/02/21

Top up

Hi, can a top cover my residual amount. When I sell my car?

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Our users say:
Posted by: Thanks | 2013/02/21

Thank you.

Reply to Thanks
Posted by: Amasi | 2013/02/21

There are many words missing in the above post but you will figure out what I was saying.


Reply to Amasi
Posted by: Amasi | 2013/02/21

Theo has a point, check your policy.
Top up is designed to cover the difference between market value of the car and a debt to the bank in case something happen which result in the insurance only paying for market value.

Why would anyone insure your debt to cover it in case you no longer wants it? Unless you are talking of the debt portion that was included in the residual.

A. R100k Cost
B. R30k Residual
C. R70k amount for instalments which is now at R50k as you have paid R20k
D. Market value R60k.

Now the following happens:
1. Theft or accident: Insurance will pay R60k but you owe the bank R80k (R50k balance plus R30k residual) then you will have a debt of R20k to the bank. TOPUP will pay that R20k for yourself.

2. You sell the car for R60k (market value) but you bank R80k  eish you are R20k short. No insurance can help you on that as you could have sold it to your cousin for even R55k or why not for R25k.

Hope this make sense.


Reply to Amasi
Posted by: T | 2013/02/21

Theo, they are still offering the cover. I recently bought a new car. I dont have it. They only mention in case of an accident, theft or highjack. Mara nothing about covering the short fall when I want to sell my car and get a new one.

Reply to T
Posted by: Theo | 2013/02/21

What is your insurance schedule saying regarding this? Please read it and you will have all the answers there.

Reply to Theo

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