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What You Need to Know Before Getting Car Insurance in the Philippines

Accidents are expensive, so it’s time to be prepared.
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Suck at money? Congrats. You’re part of the 99 percent of people in their 20s floundering when it comes to finance. Adulting is hard, and money is harder—especially when it’s your own and not your parents. My Two Cents is here to break down everything you need to know about finance, business, and entrepreneurship. We’ll tackle all the basics, from how to get a business permit to how to invest in stocks, to educate the fledgling adults on how to not go broke.

Welcome to the idiot’s guide to money. Lesson No. 23: Getting car insurance in the Philippines.

In 2019, the Metropolitan Manila Development Authority (MMDA) reported that a total of 121,771 road incidents took place in Metro Manila, a 4.16 percent increase from the number of accidents in 2018. That means that on average, there are 334 reported accidents every day in the city. There were 372 accident-caused fatalities in 2019, as well as 20,466 non-fatal accidents and 100,933 accidents that involved damaged property (aka vehicles).

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The two most common types of collisions in Metro Manila were sideswipes (9,299 incidents) and rear-ends (4,712 incidents). The least common types were hitting a parked vehicle, hitting an object, and head-on collisions. The major roads that had the most accidents were EDSA, Commonwealth, C5 Road, Roxas Boulevard, and Quezon Avenue.

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Given the high number of accidents that takes place in Metro Manila alone, it might be better to be safe than sorry and invest in both health and car insurance. You can never anticipate an accident, but you can prepare for one.

What does car insurance cover?

Car insurance is meant to help you cover the expensive costs of vehicular accidents, which usually go beyond just damaged property. That’s why most car insurance providers often offer three types of protection: damaged property, liability, and accident-related medical expenses. That means car insurance can do all the following: Pay for the damages on your car, pay for the damages on another person’s car (if the accident was your fault), and pay for hospital bills (yours and a third party’s) caused by car accidents.

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Some car insurance providers also offer coverage for non-collision caused damages, like damage caused by vandals, theft, explosions, falling objects, and even ashfall. This is called comprehensive car insurance, which considers other incidents in comparison to just collision coverage.

Is it worth it?

Absolutely. Aside from the threat to your wellbeing, accidents can drive you to bankruptcy if the damage is big enough. Also, getting car insurance ensures that you can extend your help like a good Samaritan and financially assist third parties in any accidents you might inadvertently cause.

Car insurance is not nearly as pricey as health insurance or life insurance, and the average premium for an entire year is only about P10,000 to P15,000. And that’s for the entire year, mind you.

It’s also important to mention that car owners in the Philippines are required to get Compulsory Third-Party Liability (CTPL), which is meant to cover third parties who get injured or killed in an accident involving your vehicle. CTPL only costs P650 per year.

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How do I get car insurance in the Philippines?

There aren’t as many car insurance providers as healthcare or life insurance providers, but all the ones that do exist have very affordable premiums. Money Max, iMoney, and eCompareMo have gathered and compared most available car insurance providers in the country.

But before choosing one, you need to look at the fine print. How many accredited repair shops does the provider have? What is the maximum amount that can be insured? If you have a secondhand car, does the provider accept cars older than 10 years? Does it have 24/7 roadside assistance?  

For comprehensive insurance coverage, does the plan cover theft? What types of “acts of nature” does it cover (floods, typhoons, earthquakes, eruptions)? Does it cover loss of use (reimburse expenses incurred while the car is being repaired)? Does it cover damages incurred by riots, strikes, and commotions? Does the plan also protect your car’s accessories?

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How easy will it be to claim your car insurance if you do happen to get into an accident? How quickly can the insurance provider help you after the accident?

These are all questions to keep in mind when scouting for car insurance in the Philippines if you want to avoid doling out millions of pesos in uninsured damages.

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About The Author
Anri Ichimura
Staff Writer, Esquire Philippines
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