With rising fuel and electricity costs putting pressure on South African households, financial experts urge consumers to prioritise insurance payments to avoid long-term financial setbacks.
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When the cost of living spikes overnight, people understandably look for anything they can cut, says Hayley Parry, Money Coach and Facilitator at 1Life’s Truth About Money.
She says, but cancelling or missing an insurance premium to get through this month can expose you to a much bigger financial crisis next month.
“One accident, one burglary, one unexpected loss, and a family can be set back by years. In tough times, protection matters even more,” she says.
According to Parry, just as many South Africans were beginning to feel a little breathing room, today’s sharp fuel price increase and electricity tariff hike are a stark reminder that household budgets remain under serious pressure.
Recently, petrol has increased by R3.06 per litre, while diesel has surged by as much as R7.51 per litre. At the same time, Eskom's direct customers are now paying an average of 8.76% more for electricity, with municipal increases averaging 9.01% from July 1.
These changes are immediately reflected in the wallets of consumers, not just at the pump and on prepaid meters, but across all transport, food, delivery, and everyday living costs. Parry says, and while South Africa’s headline inflation has cooled to 3.0% in February 2026, the lowest in two decades, that relief means little when the essentials that keep households moving and functioning are climbing far faster than the average.
She says in response, they are urging consumers not to make short-term cuts that could create long-term financial damage, especially when it comes to protecting their cars, homes, income, and loved ones.
When money gets tight, the wrong expenses get cut first
For many households, salaries are already “pre-spent” before payday. Rent, transport, debt repayments, groceries, and school costs leave little room for error. When a shock like today’s fuel and electricity increases hits, it becomes tempting to skip or delay what feels “non-urgent”, but insurance should never be one of them, she says.
The cost of being uninsured is often far higher than the premium
She says today’s fuel hike is expected to ripple through the entire economy. Higher fuel costs don’t just affect motorists; they push up taxi fares, delivery charges, food prices, and the cost of doing business. Meanwhile, higher electricity costs continue to squeeze households already managing rising utility bills.
This comes at a time when many South Africans are already dangerously over-indebted, with debt levels far outpacing income and little to no emergency savings buffer. In that environment, missing a premium may feel like a quick fix, but it can quickly become an expensive mistake, says Parry.
Tando Ngibe, senior manager at Budget Insurance, says now is the time for financial discipline, not financial drift. Consumers need to be brutally honest about what is essential right now. Insurance is not a luxury line item; it is a financial safety net. If your car gets written off, your home is damaged, or your family loses an income provider, the cost of replacing that protection out of pocket is simply unaffordable for most households. Staying covered is one of the smartest financial decisions you can make in a difficult month.”
What consumers should do today?
As costs rise from today, 1Life Insurance and Budget Insurance are encouraging South Africans to take five immediate steps:
Don’t assume cover is active if a debit order failed or an account was underfunded.
Rather, trim discretionary spending, subscriptions, takeaways, or non-essential purchases before touching your insurance.
If you’re under pressure, ask about options rather than simply allowing cover to lapse.
Your vehicle, your home contents, and life cover are often the very things your family can’t afford to lose.
Even a modest monthly amount can reduce the need to borrow or skip critical bills when costs spike unexpectedly.
Low inflation does not mean low pressure
South Africans may be hearing that inflation is easing and interest rates are starting to soften, but that does not change the reality at the till, at the petrol station, or when buying electricity today, says Ngibe.
“The financial wins many households hoped for in 2026 are being eroded by global shocks and local structural costs. Consumers cannot control the fuel price or electricity tariffs, but they can control how intentionally they respond. Protect what matters first,” says Parry.
Ngibe says this is the season for smart choices. “Keep the cover that protects your family from financial disaster. In a month like this, being insured is not just responsible, it’s resilient”.
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