How CIB Calculates your Vehicle Credit Shortfall Premium
CIB’s Vehicle Credit Shortfall cover is available on any vehicle that is comprehensively insured and can be included at an additional monthly premium.
With this additional cover, CIB will pay the duly registered finance company the difference between the reasonable retail value and the settlement balance outstanding under a valid credit agreement, subject to the total payment not exceeding R200 000.
The way CIB calculates your vehicle credit shortfall monthly premium is by charging you 1% on the invoiced/financed amount of your vehicle factored over a 12 month period.
For example, if you financed your vehicle for R500 000, 1% thereof is R5000. This amount is then divided by 12 to calculate your monthly premiums.
R5000 ÷ 12 = R416,66.
Based on this example, if your vehicle is stolen, hijacked or written off and you still owe the company that financed your purchase R400 000, of which the retail value is R300 000 and the outstanding finance cost (interest and other charges) is R100 000, CIB will then cover the shortfall of R100 000.
Please note that CIB Vehicle Credit Shortfall cover pays up to a maximum amount of R200 000 in indemnity. Terms and conditions for the cover are contained in the proposal, alternatively, you can obtain a copy from our office.
Warm regards
CIB Insurance
