So how much is that shortfall, you can calculate. So let's say you get hijacked, or maybe you crush you car and it becomes a right off. And the insurance company now needs to pay you out. What will happen is they will pay you out the amount that retails or the amount that you are insured for, the amount your car is actually retailing for.
And if you want to settle at the bank, because perhaps, maybe now you really actually can't afford to buy second car, because it means that you might need to buy a car that you are paying at the bank and you're more at the bank and it's not worth it, or you can find yourself in the situation where you make a decision to pay off the car loan and you don't want to take up another car and you want to settle that loan.
You may find that you are in a shortage of certain amount of money, which is the fourteen thousand rand so that how the credit insurance came up. It is important to read like any other insurance policies. It is important for you to read when and how and what the insurance claim is going to pay for.
So if you do find this situation where you do get into an accident and maybe you find this situation where you have been hijacked, and they need to pay out some of the money, you may find that there are some certain instances that credit short fall insurance will not pay.
The first one is if you have a balloon payment, very important for you to know that most credit shortfall insurance claims do not pay for the balloon payment. The second thing that you need to be very clear on is finding out from the insurance companies which part of your car extras are covered under the insurance.
So here is the thing that happens quite a lot, people get their car, then they do additional things on their cars and this shoots their retail value of the car. So let's say you put in an additional tow bar, you upgraded the radio and all those things are not necessarily insured under credit shortfall insurance.
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