There are various reasons why vehicle owners fail to get insurance. For some, it could be that they find the instant gratification from buying the latest iPhone more satisfying than having collision coverage. For others, it could be that hearing the word “insurance” alone overwhelms them to the point that they just give up.
Lastly, some believe that they don’t need to get their auto insured as they have excellent driving skills. However, Filipinos need to be aware that having a car insurance is required by the law if you own a vehicle.
Regardless of these factors, one thing is true: Accidents can happen anytime, anywhere. And it can happen to anyone.
As much as having and driving a vehicle you can finally call your own can be exciting, it has its own fair share of risks. Whether your car suffered damages from a collision, a fire, or a flood, vandalism, having adequate car insurance coverage will give you the financial assistance you need to recover in the case of an accident.
Road accidents are becoming increasingly common in our society today.
Car insurance will help you when you get on car accidents
While no one wishes for accidents to happen, you need to anticipate possibilities that can cost you your life, car, savings, and others’ as well. This is where the importance of selecting the right vehicle insurance comes into play.
On that note, before we share with you some helpful advice on how to find the right plan for your needs, it helps for you to understand the following first:
Key Benefits of a Car Insurance Policy
1. Collision Coverage
As the name suggests, a car insurance policy will protect you from financial responsibilities regarding vehicle repairs if you get into a car collision. For the most part, you will be covered regardless of who was responsible for the accident.
This can be particularly helpful especially if you have a brand new (or relatively new) car as car parts and repair are quite expensive.
2. Property Damage Liability Coverage
If you are at fault for an accident, this coverage will protect you from financial responsibilities involving repairs for car, property, and other non-human damages.
For example, if you have slammed your car against a neighbor’s fence, this coverage helps pay for the fence repairs or replacement. This also covers legal fees if a case related to the incident is filed against you.
However, keep in mind that this coverage does not include the damages to your own vehicle.
3. Bodily Injury Liability Coverage
This coverage protects you from financial responsibilities in case you hit or injure a person in an accident.
This includes the medical treatment and rehabilitation costs of the injured party. In some cases, it also includes lost wages, pain-and-suffering costs, emotional distress damages, legal fees, and funeral expenses.
In the simplest sense, bodily injury liability coverage covers the damages other parties suffered from an accident that you are responsible for. This includes your passengers as well as the other drivers, passengers, and pedestrians involved.
4. Comprehensive Coverage
The first thing you have to remember when you come across this term is that it does not contain all the coverage you’ll need—despite it being called “comprehensive.” Car insurance terms can be misleading, so you’ll have to pay extra attention.
Comprehensive coverage covers damages resulting from events other than a collision. These events can be theft, vandalism, fire, riots, falling objects, and natural disasters.
This coverage also protects you in case your car and/or its contents get stolen.
5. Compulsory Third Party Liability (CTPL)
This is mandated by the Land Transportation Office (LTO) whenever you purchase a new car or have your vehicle’s registration renewed.
CTPL protects you from financial responsibilities related to bodily injuries, permanent disabilities, and even death to third parties involved in an accident.
With that said, this does not cover you as the vehicle owner as well as your passengers. Buying only CTPL will leave your family and passengers exposed to great financial risks in case of an accident.
1. Voluntary Third Party Liability
This provides you with additional coverage on top of your basic CTPL.
2. Personal Injury Coverage
This covers the medical and hospitalization fees for your own injuries as well as your passengers.
3. Loss of Use
If your vehicle becomes unavailable for use after an accident, this allows you to reimburse any transportation expenses incurred during the time your car was being repaired.
4. Acts of God Coverage
Also referred to as “Acts of Nature,” this helps you pay for repairs for damages due to natural events such as flooding, typhoons, and earthquakes.
5. Roadside Assistance
In case your vehicle breaks down in the middle of the road, this will help you easily and conveniently get a towing service. This is usually an optional added service.
READ ALSO: Top 10 Best And Rated Car Insurance Companies
READ ALSO: Top 10 Best Insurance Companies In The World
READ ALSO:Top Best 4 Types of Insurance Policies And Coverage You Need
Eight Smart Tips for Choosing the Right Car Insurance Plan
Getting auto insurance is a practical decision to make, considering all the potential risks involved in driving. However, it helps to remember that it is also mandatory in the Philippines for you to have your vehicle insured.
The law requires you to acquire at least the CTPL. Since you are going to have your vehicle insured anyway, why not grab the opportunity to do it well?
The common mistake drivers make is that they purchase a policy right after they buy their first car for the sake of compliance. While this helps you comply with the legalities of owning and driving a car, this is not practical in terms of your finances.
To help you choose the right car insurance for your needs, here are eight smart tips worth following:
1. Familiarize yourself with car insurance jargon
If this is your first time purchasing auto insurance, seeing all the technical words can truly be overwhelming. That said, you must learn the insurance jargon at least one word at a time. This will make it easier for you to browse through your options later on and find the right plan for your needs. This will also help you communicate with your advisor better and make them understand what you truly want your car insurance policy to include.
Reading these terminologies can be confusing at first, but you will become familiar with them the more you read and use them.
2. Examine your driving habits
The best car insurance plan is the one that adequately covers your needs. You will not be able to find the right policy if you don’t know your driving habits, needs, and typical risks.
Before you start looking around for quotes, it’s best to assess your situation first. Do you usually drive in flood-prone areas? Or do you drive mainly in the city and often pass by accident-prone areas? Do you love going on out-of-town trips?
Looking at your driving habits and the routes you usually take help you find the best car insurance for your lifestyle.
Your driving habits will speak volumes when it comes to what type of coverage you need to prioritize when building your plan.
3. Look for reputable and reliable insurance companies
One of the most straightforward ways to ensure that you will get good protection is to partner with reputable insurance companies.
Especially if you are a first-time buyer, it pays for you to do your research on the different insurance providers in the company before proceeding with anything. You may look up the car insurance company you are eyeing on the Internet to learn about their reputation, especially when it comes to claim settlement.
Learn how long they take to process a claim and how well they are faring in terms of their finances. Doing your research diligently will help you steer clear of inconveniences once you’ve signed a contract.
4. Compare quotes
Some people tend to settle with the first quote they get. While this can be convenient for some, this will not be helpful for you, especially if you want to get the best value out of your insurance policy.
The best practice would be to look around for other providers and gather at least three quotes that you can choose from. Closely examine the coverage and features offered in these quotes along with their rates. You may also speak to an agent if you want to clarify some items specified under the coverage.
This may seem like a tiring process, but it will certainly help you find a better deal. If you are looking for a time-efficient way to do this, you can conduct your comparison shopping online through online platforms such as Kwik.insure.
5. Consider your budget
Aside from your vehicle and your driving habits, you must also consider your budget when you compare quotes. It helps to remember that if you want more coverage and more security, you will need to increase your expenses most of the time.
If you feel that something is lacking after examining the coverage and rates of your choices, you can opt to include add-ons to them. Find the coverage you think you need to add and create a forecast of your expenses with these additional items. While top-ups will require you to pay extra premiums, it will give you more benefits.
At the end of the day, you have to allocate your funds wisely. Do not overextend your budget and get only the coverage you need. This will help you be able to pay for your policy’s premiums without fail, even if your financial situation drastically changes in the future.
Considering your budget as you build your car insurance plan will help you maintain a healthy financial standing.
6. Maintain a good credit
When applying for vehicle insurance, your driving history and type of vehicle will be taken into consideration to determine how much you will pay for the policy. Aside from these, your credit score will also be examined.
To get a favorable result, you must regularly check your credit score even before you start working your car insurance out. Insurance providers check this to help them predict insurance losses, so a low score may negatively impact your premium.
Here are some key factors that you must pay attention to:
Payment history (e.g. late payments, delinquencies, etc.)
Length of credit history
Types of credit (e.g. credit cards, loans, etc.)
7. Make the most out of discounts
Certain factors make you a “low risk,” such as your age, marital status, driving record, and even the driver training programs you have attended. If you are considered low risk, certain discounts will be made available to you.
Getting anti-theft and safety equipment installed in your vehicle may also reduce your premium. You must make the most of these factors to bring down your costs and achieve a better car insurance deal.
8. Read before you sign anything
If you have already built an insurance plan covering your needs, it’s best to give it one last look before signing the papers. Take your time to go through the items specified in the coverage for you to know and understand the details of the policy.
Once you’re satisfied with the clauses and terms, it’s time to affix your signature and enjoy some peace of mind knowing that your vehicle—and you and your loved ones—are well-protected.
Getting the right vehicle insurance boils down to identifying your needs and making sure that your policy adequately covers them.
- Final thoughts:
Car insurance is mandatory in the Philippines, especially the Compulsory Third Party Liability Coverage or CTPL. Driving without one and getting caught in an accident will entail large penalties and serious consequences.
Since you are getting your vehicle insured to comply with the law, it makes sense for you to do it well while you’re at it.
The process does not need to be a stressful and complicated one. You can get started by familiarizing yourself with the terms and concepts involved in insurance plans, like the components and add-ons mentioned above. If you aren’t quite sure how to get started in finding the right car insurance plan for your needs, you may also consult the tips mentioned above.
Your car is one of your valuable possessions; it’s a fruit of your hard work. To protect it and keep your loved ones safe as well, devote the time and effort to study your options—with adequate policy, you will be glad you went the extra mile.
