How Points Could Cost Your Car Insurance

What Licence Points Really Mean for Car Insurance Owners 

For years, South Africans have been warned of the impending AARTO system. Although it won’t come into effect until 2027, compliance will still have to be followed by businesses, ensuring all the appropriate processes are met and in place for the time being. 

So far, the country has confirmed a roll out across 62 municipalities from the 1st of July 2026, set to expand to another 150 municipalities. 

How is this even relevant to car insurance? 

Well, road accidents nationwide cost over R180 billion annually, having uninsured drivers driving up the numbers and putting others (who may have or may not be insured) at risk. BusinessTech reported that almost 70% of vehicles in the country are not insured, which becomes a problem when one of the drivers can’t make payment for the damages.

How the System Affects Car Insurance 

The new AARTO system was first signed into law back in September 1998, but the demerit points were heavily delayed for decades because of legal and technological obstacles. However, 2026 has shaken things up for motorists, or so AARTO likes to think. 

So, how does the system work? Think of it like a “credit score” for your car insurer.

The moment you commit an offence or traffic infringement on the road; you’ll accumulate points against your licence. If you or other drivers commit enough offences, you could lose your licence completely or have it suspended. 

The rude awakening here is that your car insurance provider will consider points as part of your driving record. Accumulate enough penalties and you could lose your cover and licence altogether.
 
From the cheapest offence to the most expensive and severe penalties, you can find more info right here: AARTO’s new demerit points: Traffic laws every South African should know. 

An AARTO infringement notice is an official document that motorists get for committing an offence under the AARTO (Administrative Adjudication of Road Traffic Offences) Act. 

From traffic violations to administrative procedures, missing any infringement notices can become an inconvenient issue:

1. You may receive a summons or courtesy letter.
2. You may be blocked from renewing your driver’s licence card or licence disc.

How to Pay AARTO Fines

To avoid being suspended and cancelled by both your provider and eNatis, you can opt to pay in a few ways: 

Pay traffic fines online via the AARTO portal or through third-party platforms like PayCity or Fines SA

The real question is, do you need car insurance? And sure, this could be considered a personal choice for private car owners, but is it a wise one? This obviously excludes fleets and business vehicles where insurance isn’t exactly an opt out option.
 
Van Deventer Dowlath and Marx Inc Associate Director, Tanya De Villiers explained to IOL, “We’re looking at over 2,000 accidents a day on roads where an estimated 65% to 70% of vehicles aren’t insured, according to data from the Automobile Association and South African Insurance Association.
 
MasterDrive CEO, Eugene Herbert says businesses should take the points system, as well as insurance pretty seriously. He said, “Every fine issued to a company vehicle is now linked directly to its official business Registration Number via eNatis. Fines can no longer be ignored or delayed.” 

As for private car owners, insurance can only save you when you consider the types of cover, and how factors like the demerit system come into play (when and if you’re ever involved in an accident).

How Much is Car Insurance Per Month in South Africa? 

The cost of your car insurance per month will vary -- from vehicle model and location to driving behaviour and type of cover. There’s no one-size-fits-all cost when it comes to monthly premiums. 

From Comprehensive Insurance to Third-Party, Fire & Theft, the type of insurance cover you choose makes a big difference to your monthly spending. Your lifestyle and driving habits, which is where premiums come in also influences your cover, the riskier your lifestyle or vehicle, the more expensive. 

As for excess and how it affects your insurance premiums, this is the amount of money you’ll pay out at your own expense in the event of making a claim. The only thing people don’t consider is when one of those factors goes up, the other comes down. If you choose to pay a lower excess, you’ll end up paying more for your premium and vice versa.
 
Learn more about how car insurance excess works here. 

The impact that traffic fines have on a motorist’s record goes beyond paying fines online, it becomes an insurance nightmare too. 

It’s really about one thing above all the rest: to minimise the risk of accumulating too many fines. It’s as simple as obeying the traffic laws, avoiding road rage and reckless driving, and taking an advanced driving course. If you feel that the fine against you is unjustified, you may be able to contest it so that your driving record remains intact and doesn’t raise alarms with your insurance provider.