by Moneymax, on category "Car Insurance"
April 8, 2019
Buying car insurance is a lot like buying a fire extinguisher: you pray that you’ll never need it, but you feel better knowing it’s there anyway. However, many car owners are concerned about car insurance cost and whether they can afford it or not.
You might be wondering: “Why does car insurance cost so much?” While you may think of the cost of car insurance as an added expense, it’s worth knowing that the annual premiums are there for a reason. You’re buying not just an insurance policy but also peace of mind knowing your budget won’t blow up should you need to bring your car to the casa for repair.
What you can do is research on car insurance costs, compare car insurance quotes, and find the policy that fits your needs at a rate that fits your budget.
Here’s what you should know about car insurance costs in the Philippines.
In the Philippines, car owners are required to get Compulsory Third-Party Liability (CTPL). This type of car insurance covers passengers or third parties who get injured or killed due to an accident involving your car. It’s recommended to get CTPL insurance before registering your vehicle with the Land Transportation Office (LTO).
CTPL insurance costs a minimum of PHP 650 annually for private cars, and covers a maximum amount of PHP 100,000 within the limits prescribed by the law.
CTPL insurance premiums are regulated by the Insurance Commission (IC). This means CTPL rates are the same across models of the same vehicle type, and no insurance provider is allowed to charge more than what’s set by the IC.
Aside from the basic CTPL coverage, you may also opt to extend your car insurance to cover other untoward incidents such as road accidents, car theft, or natural calamities. Extending your coverage can be helpful if you’ve invested in a luxury vehicle, or if you live in a flood-prone area.
For basic vehicles on the lower end of the price scale, the average cost of a good car insurance policy may range from around PHP 12,000 to PHP 20,000 per year. That’s more or less PHP 1,000 per month.
To find out how much it will cost you to insure your vehicle, compare cheap car insurance quotes for free at Moneymax. Using this online tool will let you know that, for example, if you own a 2018 Toyota Vios J Base Model 1.3L Gas M/T, the cheapest policy will cost around PHP 12,800.
The cost of your car insurance premium relies heavily on a number of criteria, mainly the market value of your vehicle. As a rule, insurance premiums for brand-new vehicles are higher than that of second-hand vehicles due to factors such as depreciation. If you’re buying a new car, chances are that your dealer will have either in-house insurance or a list of accredited insurance providers on hand for you to consider buying from. Remember that it is not necessary to buy from such dealers. You have the option to choose.
Car insurance premiums may cost even higher depending on your car’s value and type, i.e. whether it’s a sedan, sports car, or an SUV. SUVs, for instance, cost more than PHP 30,000 to insure per year.
You can get basic CTPL from any car insurance providers, but you can also purchase additional coverage such as voluntary third-party liability, excess bodily injury, property damage, and roadside assistance.
While car insurance cost is a primary consideration for car owners with limited budgets, it shouldn’t be the only factor to look into when choosing a car insurance policy. Several car insurance providers now offer specialized car insurance packages, and what’s best for you may vary depending on your specific needs.
If you can afford it, get a comprehensive car insurance plan that offers all the coverage you need. Pay close attention to the terms of the policy, as insurance providers may make some exemptions in their coverage.
To ensure you don’t overspend on your annual car insurance premium, do your research on factors that could lower or raise the price you pay in insurance. Examples include your age, location, vehicle type, participation fee, and whether the car will be used for private or commercial purposes.
As a car owner, you must exercise caution before you invest in car insurance. It’s not uncommon for shady fly-by-night operations to sell fake CTPLs at irresistibly low rates or at convenient locations close to major LTO hubs.
Whether you’re getting basic or comprehensive coverage, see to it that you choose a reputable insurance provider with a background in non-life insurance products. When you make a car insurance comparison here at Moneymax, you’ll find a variety of options from the most trusted providers in the Philippines. Start your search for the right car insurance here!