First Time Driver? Here’s How to Get the Right Car Insurance for You
By: Venus Zoleta
Published on: October 14, 2019 . Last updated: September 5, 2020 Category: Car Insurance
Being a new and young driver comes not only with perks but also responsibilities, like maintaining your car regularly, driving safely, knowing and obeying the traffic signs and rules, and getting a driver’s license. An equally important but often overlooked task: getting one’s car insured.
Before you hit the road and enjoy your newfound freedom, make sure you have the right insurance for first time drivers. This means getting a policy with enough coverage at the right cost. This way, you won’t be burdened too much with repair bills should something happen to your car, another person or property, or yourself after an accident.
Here are some tips on choosing car insurance for first time drivers in the Philippines.
Table of Contents
- 1. Pick the Right Car
- 2. Figure Out the Car Insurance Coverage You Need
- 3. Compare Car Insurance Quotes
- 4. Choose the Right Car Insurance Company
- 5. Decide Where You’ll Buy Car Insurance
- 6. Understand the Policy Before Buying It
- Final Thoughts
1. Pick the Right Car
Several factors drive the cost of car insurance up or down, including the vehicle’s price, type, and safety. This is why some vehicles cost more to insure than others.
For example, luxury brands like Mercedes-Benz and BMW are more expensive to insure than the likes of Suzuki, Toyota, Honda, and Mitsubishi. In terms of vehicle type, hatchbacks and sedans are cheaper to insure than SUVs and sports cars.
Cars that are safe to drive tend to have lower insurance prices than cars that are accident-prone. It’s because vehicle damage and repair costs affect car insurance premiums. The higher the risk of a car figuring in an accident, the more expensive it is to insure.
So, if you’re still shopping around for a new car, look not only at the vehicle’s selling price but also the cost of insuring it. Insurance for first time drivers is one of the car ownership costs to consider during a car purchase.
So what’s the perfect car for the practical first time driver? Choose a car that’s safe to drive and cheap to own and insure.
2. Figure Out the Car Insurance Coverage You Need
Coverage is as important as the cost when it comes to car insurance. So take the time to decide which kinds of coverage you need as a newbie driver. Factor in your driving habits, skills, and situation when choosing the right car insurance coverage.
You don’t want to end up having less coverage than you actually need because you opted for a cheaper premium. At the same time, it’s impractical to overpay for a coverage you won’t likely use.
Must-Have Coverage on Insurance for First Time Drivers
New drivers in the Philippines should consider these six types of car insurance coverage:
1. Compulsory Third-Party Liability (CTPL) Insurance
CTPL insurance is required by law for all drivers in the Philippines before applying for car registration with the Land Transportation Office (LTO). When you hit a pedestrian while driving your car, for instance, this type of insurance coverage will pay for the third party’s medical or funeral expenses.
2. Comprehensive Insurance
The coverage of CTPL insurance is rather limited—it covers only the victims of an accident involving your car. It won’t reimburse you for when your car gets stolen or damaged due to collision, fire, or an incident that’s out of the driver’s control. Comprehensive car insurance coverage provides basic coverage for the driver and the vehicle in such situations.
3. Personal Accident Insurance
CTPL insurance doesn’t cover the insured driver and his/her family and relatives, so it makes sense to include a Personal Accident cover in your policy. Personal Accident insurance provides death benefits and permanent disability benefits, as well as pay for medical expenses when the driver and passengers get injured or die due to an accident involving the insured car.
Getting this coverage is a must if you’ll be driving regularly with family members, like sending and picking up kids from school or your spouse from work.
4. Acts of God/Acts of Nature
Living in a disaster-prone country, both experienced and inexperienced drivers in the Philippines need to get an Acts of Nature (AON) coverage for natural disasters such as typhoons, floods, and earthquakes. This type of insurance coverage is a requirement when you buy a car through an auto loan from the bank.
5. Roadside Assistance
For first time drivers, experiencing a car breakdown or getting into an accident is the worst nightmare on the road. Being alone with a stalled or wrecked car and nobody to assist you immediately can be very stressful.
But with a roadside assistance coverage on your insurance policy, you can rest easy knowing that your insurer will help you with towing, replacing a flat tire, arranging for ambulance or hospital admission, or any vehicle-related or personal assistance you might need.
6. Third-Party Property Damage Liability
If you have this coverage, the car insurance provider will reimburse others for damage you may cause to somebody else’s vehicle, building, fence, lamp post, or other property.
3. Compare Car Insurance Quotes
After deciding on the types of coverage you need, you can start getting cost estimates from different car insurance providers. Car insurance premiums vary from one provider to another, so it’s important to compare multiple quotes to find the best deal. Don’t make the mistake of buying the first car insurance quote you get because chances are, you’ll be missing out on a better deal with another company.
The fastest and easiest way to get the cheapest quotes for free is to visit a comparison site like Moneymax. Simply enter your personal and car-related information on the site, and you’ll instantly get quotes from at least three insurance providers in the Philippines.
When comparing car insurance quotes, don’t just check out the prices. It’s also crucial to compare the coverage that comes with each policy. A cheap policy may offer fewer benefits or lack the coverage you need. Conversely, an expensive policy doesn’t mean it’s the best—it might have too many inclusions that you don’t need.
4. Choose the Right Car Insurance Company
Cost and coverage are two critical factors when choosing the right car insurance for first-time drivers. When you’ve found the right prices and coverage online, it’s also good to research the companies that offer them.
Read online reviews and ask feedback from family and friends about the insurance providers you’re considering. Pick a reputable car insurance company with good financial standing and a good track record in terms of customer service and claims processing and payment.
As for the financial performance of car insurance firms, check the Insurance Commission website.
5. Decide Where You’ll Buy Car Insurance
Car owners in the Philippines can purchase a car insurance policy through a bank, a car dealership, or an online brokerage company. Each option has its pros and cons, particularly in terms of convenience, insurance costs, customer service, and reliability.
For instance, banks and dealerships provide the most convenient way to buy car insurance (with the policy already bundled with the car purchase), but they charge expensive premiums. On the other hand, online brokers allow comparing a variety of quotes and finding cheap car insurance rates.
To make an informed choice, read the following articles about the best ways on getting a car insurance:
- Should You Get Car Insurance Through a Bank, Dealer, or Online Broker?
- Reasons Why You Should Get Car Insurance Online
6. Understand the Policy Before Buying It
A lot of frustrations and unmet expectations involving car insurance stem from failing to read one’s policy before signing the dotted line.
Make sure you understand what you’re buying. Take the time to read and understand your car insurance policy before purchasing it.
Pay close attention to these key details provided through the insurance policy:
- The persons covered
- What are covered
- Start and end period of coverage
- How much coverage will be provided
- Any coverage exclusions or limitations
- The annual premium cost
- How to pay for your premium
- How to file a car insurance claim
A policy, being a legal document, is filled with technical terms that are difficult to understand, especially for first time drivers. It helps to ask your agent or an insurance professional to explain in simple terms anything in the policy that you don’t understand.
Getting car insurance for first time drivers require a bit more time and legwork because, obviously, you’re doing it for the first time—and you want to make sure you’ll have enough coverage at a reasonable price.
After buying your first policy, review your insurance every year to check if you need to increase or decrease your coverage. Or you may need to add or remove a type of coverage from your policy. Later on, you might also realize you can get a better deal somewhere else. Your situation and car insurance needs change over time, so don’t forget to review your existing policy before renewing it.
Compare Car Insurance Quote from Top Providers
Below is a list of top companies and their features. Compare your options and get a free car insurance quote.
Venus is the Head of Content at Moneymax, with over 15 years of combined experience in digital marketing, corporate communications, PR, and journalism. She invests in stocks, mutual funds, VUL, and Pag-IBIG MP2. Outside of work, she’s crazy about cats and Korean dramas. Follow Venus on LinkedIn.