How to buy Car Insurance for OFWs

Published: July 21, 2016 | Updated: December 13, 2019 | Posted by: Carlo Miguel Castañeda | Car Insurance


Buying a car takes time because it’s expensive and comes with a lot of responsibilities. A lot of OFWs think about buying a car for their personal use in the Philippines.

Some OFWs will go as far as buying a fleet of cars to start their own transport business, or sign up for one of the many ride-sharing apps available in the country. Many OFWs leave the country for their families.

These remittances contribute 13.5% to the country’s growth, according to the BSP. Some will get a home, support their families, and some will purchase cars.

How does it happen?

Most OFWs won’t be in the Philippines when their car is purchased. Most will simply ask their family members who are of age to deal with the purchase and registration of the vehicle itself.

If you’re working abroad, the car you want may not be available in the Philippines. Your best bet of acquiring the car is going to local websites of car dealers.

Determine whether you want to buy a new or secondhand one. You won’t inspect the car, so have who is buying the car send you photos.

An important thing to note is that because you aren’t physically present, your representative will require a letter authorizing them to make the purchase on your behalf, along with your identification, confirming your status as an OFW. The purchase itself will require a Special Power of Attorney, as your representative will have to collect documents, the money from the loan (if you took one out), and sign contracts on your behalf.

The insurance component

It is required to get a Third-Party Liability cover as mandated by law. Other covers are up to the car’s owner. Because the policy will be under your name, anyone you authorize to use the vehicle will have to be written into the policy as assignees.

Authorized users included in the policies will also require a duly notarized Special Power of Attorney to make claims on your behalf should the vehicle in question figure in an accident. One more thing you need to take note of when it comes to a SPA if it’s signed abroad:

The OFW or Grantor or executor of SPA must sign the SPA Document and proceed to a Philippine consular office to have it consularized (the equivalent of notarization here in the Philippines) and then have original copies sent here via courier.

The best way to look up other covers and prices is to use comparison websites. These websites can help you get value for money in a car insurance policy. As with looking at any insurance policy, you’ll want to ensure you get the right covers and inexpensive premiums. Comparing providers lets an OFW get options conveniently.

The purpose of your car can change its insurance coverage. Make sure to do your research on the difference between insuring a car for personal use and a car that might be used for Grab or Uber.

Final Thoughts

Being away from the country when you decide to buy a car is difficult but if you can arm your representative with knowledge, you might just end up driving off with the car of your dreams