Chris Dominguez
Yes. You read that right. You don’t need one. Why would anyone actively want to avail an insurance for their car? It’s just mind-boggling. You spend PHP 15,000.00 to PHP 30,000.00 above for what? A piece of paper that is just going to add to the clutter of your dashboard compartment and will never see the light of day again.
All you have to do is be a GOOD driver and you will be fine — or at least that’s once we all thought when we did not know any better… uhm right? Or do you still think this way?
If that is the case, we are not faulting you. Lots of people are just very confident with their skills and that’s fine but we all have to realize that sometimes, skills just aren’t enough. Well, lots of the time actually.
I already have CTPL. Comprehensive Insurance is redundant.
Or is it, really? Compulsory Third Party Liability or CTPL is the minimum coverage that every car must have for it to be registered with the Land Transportation Office (LTO). As the name suggests, it gives the policy owner coverage for any damages incurred to a third party in case of an accident. “Third party” here means friends, acquaintance, and co-workers (who aren’t your subordinates) or just about anyone you have no blood or legal relations with and who are OUTSIDE the vehicle when an accident happens. “Damage” means bodily damage; injuries be they minor or major, disablement, and death.
And… well, that’s it. No coverage for the property damages incurred to 3rd parties, for your passengers, for you and for your car if it sustains a fender-bender after some guy mindlessly cuts you so you had to make an impulsive swerve towards a barrier. Road safety is borne out of the cooperation of multiple parties. One error from one or more of them and it can go sour in the blink of an eye.
Aside from the very limited coverage, the amount that you’re assured with is also quite meager. A mere total of PHP 100,000.00. Anything above that, you’re going to have cover with your life savings.
A comprehensive insurance on top of your compulsory third party liability isn’t redundant. Even saying the former complements the latter is an understatement. We call it “comprehensive” (complete) for a reason. Not convincing enough? Well, let’s get that legal-sized envelope your insurance agent has sent you, or that PDF rather, since almost everything is online now.
What’s in a policy?
Now let’s check the inclusions one by one. All these stuff that you gave a once-over and never looked at again:
Own Damage/Theft – Basically the value that your car is priced at based on the list released about yearly by the Insurance Commission, factoring only each specific model’s depreciation rate. Whatever amount it is that you are seeing there, that’s the total consumable amount of money you are going to receive if your car gets any damage; from the minimum repairable damage allowed up to being totally wrecked or stolen.
In 2018, PNP reported 326 car thefts. Very small number, right? But what about daily car accidents?
According to Metropolitan Manila Development Authority (MMDA), in 2019, there were 121,771 car accidents reported. That means 334 road accidents are being reported every day. And since our road traffic is almost back to normal now, the daily numbers should have already returned to normal as well. Just how many of the 334 cases today would have to take on debt had they not been insured? How many actually took on and will take on some debt because of having no insurance? Surely, many ( if not most) of these people are decent or even great drivers who never quite expected to be involved in something that they are used to only seeing happen in other people. They are very much like ourselves, really.
Oh and just to add, even cases such as when someone steals your side mirror or when an angry ex “keys” your car are covered as well – assuming that the total damage cost is above the minimum amount allowed for a claim. The threshold is different for every car insurance company so you will have to personally check that with your insurance provider.
Third Party Liability (Bodily Injury) – This is CTPL but better. Increases the total assured amount. In a car accident, hospitalization can easily burn through PHP 100,000. Having a higher limit is always better.
Third Party Liability (Property Damage) – You rear-ended someone because of a slippery road? Or perhaps you hit a public property like a signage or a concrete barrier? This coverage will ensure that you won’t have to pay tens of thousands for recompense.
Auto Personal Accident Coverage for Passengers – Probably the most important coverage to many. The coverage that will financially protect your family, friends, and yourself — the people that naturally matter to you the most. Coverage for this is usually PHP 50,000 per passenger. Take note though that number of passenger slots insured can not exceed the seating capacity of your car. If your car officially is a 7-seater, only 7 passengers can be covered by your insurance regardless of how many more people you can actually squeeze into it. A reminder to never overload. You wouldn’t want to choose who among your passengers needs the coverage the most during an accident. Of course you wouldn’t have to choose if your car is not insured in the first place but that’s never a good thing.
Acts of Nature Coverage – With acts of man covered, the gaping hole left in your protection is acts of nature. Floods, fire, earthquake, falling debris, a cow ramming your parked car out of nowhere, everything that can be considered an incident that no man directly caused is covered if you have this coverage.
Just recently, many parts of the country experienced a massive downpour that flooded roads in an instant. Many roads became completely impassable. Those who were currently on their way home or work were stuck. One second they were mindlessly driving through their daily route. Next thing they know they are swimming through waist-deep muddy waters with their vehicles slightly afloat at their backs.
The Philippines is hit by about 20 typhoons each year and about 5 of those are almost always destructive. We’re also in the pacific ring of fire and many of our major roads and cities directly stand upon fault lines. It’s just foolish to assume your car will never get to face nature’s wrath throughout the years that it’s going to be in operation.
Will you take the chances?
Land transportation still remains as the most dangerous way to get from point A to B. It causes more fatalities and property damages on average even if we are to consider the fact that it’s the most common means of travel. It’s a surprise that most of us are more anxious when we do air travel than when we drive or when we are passengers in someone else’s car.
Driving is already a gamble. The only reason why you would not need a comprehensive car insurance is when you’re fine with the high stakes involved or if you are only intending to put your car on display. No, you need not take in any more risks than necessary. Secure everything that can be secured. Sometimes a piece of paper can be the only difference between a bad scenario and the worst.