Basic Types of Car Insurance Coverage Explained

Published: September 2, 2020 | Updated: September 30, 2020 | Posted by: Ricky Publico | Car Insurance


Types of Car Insurance Coverage in the Philippines Explained | Moneymax

So you’re walking back to your car after a long day at work and you find a big scratch on the side of your car door. You’re pretty sure someone vandalized your car while you were away. Nightmare situations like this really make you consider the types of car insurance coverage you should be having.

It’s natural to get pissed off when your prized vehicle gets damaged in any way. If you’re like most drivers, you would immediately ask whether your vehicle insurance will cover the damage or not. Having your car stolen, or worse, getting involved in a motorist accident that puts lives in danger are other events where car insurance can be really useful.

To know whether you’re protected financially by your insurance company, you need to know about the different types of car insurance coverage in the Philippines. This can help you decide on what coverage to get when you apply for car insurance or have it renewed.

Types of Car Insurance Coverage in the Philippines

Liability Coverage

types of car insurance coverage - liability coverage

Liability coverage is one of the most basic types of vehicle insurance coverage in most countries. In fact, most countries require car owners to have liability insurance coverage before they can drive their vehicles. It covers the cost of the damaged property or the medical bills of people injured in the accident up to a certain amount as specified in your policy.

Should you be involved in a covered car accident that you are responsible for, this coverage will essentially pay for the other party involved. It won’t cover the damage costs and medical bills on your end.

In the Philippines, the Land Transportation Office requires car owners to avail third party liability (TPL) insurance as part of their car registration process. TPL insurance covers the medical or funeral expenses of the third party involved in an accident up to PHP 100,000. It costs from PHP 650 to PHP 1,300 depending on the type of vehicle you have.

Read more: TPL Insurance in the Philippines: A Quick Guide for Filipino Motorists

Comprehensive Coverage

types of car insurance coverage - comprehensive coverage

If your car insurance has comprehensive coverage, it means you can make a claim for car vandalism and other types of damages. True to its name, comprehensive coverage means you can protect your vehicle from a wide range of causes. From motorist accidents to acts of nature, rest assured your wallet won’t cry if anything happens to your car—provided you have a great car insurance deal.

And unlike TPL, comprehensive car insurance is not mandatory. It can also cost from PHP 8,000 to PHP 30,000+ per year. So why do you need it? Because with a comprehensive car insurance coverage, you can customize your vehicle protection.

Basic Coverage Included in Comprehensive Car Insurance

  • Own Damage/Theft. It covers car damage, loss, and damage/loss of declared accessories and spare parts. In extreme cases like car robberies, fire, or explosions, your car insurance will handle all repair expenses.
  • Property Damage or Voluntary Third Party Liability (VTPL). It covers damages caused by your vehicle to other people’s properties in the event of an accident. Regardless of who is at fault, your insurance will cover all property damages.
  • Personal Accident or Auto PA. It covers the insured individual and the unnamed passengers inside the vehicle in the event of injury, disablement, or death caused by a vehicular accident. Usually, this coverage comes free upon availing a comprehensive auto insurance policy.
  • Acts of God. It covers damages caused by extreme natural disasters such as earthquake and flood, and even animal contact. Acts of God is a popular coverage in the Philippines, thanks to the country’s unpredictable weather conditions. Remember the wild ostrich roaming the streets of Quezon City[1]? If it scratched or trampled your car in any way, it’s also covered.

You can also include add-ons to your comprehensive auto insurance to add more coverage. This can include legal assistance, roadside assistance, riots, strikes, and civil commotion coverage, and even pet injury coverage.

Read more:

Collision Coverage

types of car insurance coverage - collision coverage

While liability coverage takes care of the third party involved in a car accident, collision insurance takes care of the damages inflicted to your car. If your car received major dents from a freak collision accident, it will cover the repair costs. If your car got totally wrecked or if the repair costs exceeded the value of the car, collision coverage will pay the value of the car based on its fair market value[2].

Take note that collision insurance only covers damages that resulted from a collision accident, hence the name. It will cover damages caused by your moving vehicle hitting other cars or solid object and damages caused by a single-car accident (e.g., your car rolling or falling over a cliff). Good thing this coverage comes bundled with most comprehensive car insurance policies out there.

Personal Injury Coverage

types of car insurance coverage - personal injury coverage

Meanwhile, personal injury coverage takes care of the passengers involved in a road accident. Since the mandatory TPL insurance only covers the third party that was injured or deceased outside the car, you’ll need a personal injury protection to take care of you and your passenger/s’ medical expenses. Fortunately, this coverage is also a standard in most comprehensive car insurance plans.

Aside from yourself, you can also choose to cover your family members, regardless if they drive your car or not. Most car insurance companies in the Philippines offer group personal injury coverage that covers more than just the insured individual. You can also have unnamed passengers insured as long as they were inside the vehicle during the accident.

Some personal injury protection also provide financial aid after income loss resulting from a car accident. For example, if you can’t go to work because of your injuries, your personal injury coverage can help you recover financially.

Final Thoughts

A car is an important investment. By getting comprehensive car insurance, you do more than protecting that investment—you also spare yourself from the stress and the worry in case of unexpected events. Take these types of car insurance coverage to mind as you compare car insurance quotes, preferably through an online comparison website.

Get a Free Car Insurance Quote!

Looking for car insurance? Below is a list of top companies and their features. Compare your options and get a free car insurance quote from Moneymax!

Car Insurance CompanyFeatures
MAPFRE Insular

Get Free Quote
  • Alternative Transport
  • Overnight Accommodation Amount - P 3,000
  • Towing Amount - P 5,000
  • Vehicle Removal Crane Services Amount - P 10,000
  • 10 Years of casa eligibility
  • 366 accredited repair shops
  • P 5,000,000 Maximum total insured
New India Assurance

Get Free Quote
  • Overnight Accommodation Amount - P 1,500
  • Towing Amount - P 4,000
  • Vehicle Removal Crane Services Amount - P 10,000
  • 10 Years of casa eligibility
  • 30 accredited repair shops
  • P 3,500,000 Maximum total insured
SGI Philippines

Get Free Quote
  • Overnight Accommodation Amount - P 2,000
  • Towing Amount - P 5,000
  • Vehicle Removal Crane Services Amount - P 10,000
  • 5 Years of casa eligibility
  • 36 accredited repair shops
  • P 5,000,000 Maximum total insured
Stronghold Insurance

Get Free Quote
  • Alternative Transport
  • 10 Years of casa eligibility
  • P 3,000,000 Maximum total insured
The Mercantile Insurance Corporation

Get Free Quote
  • Overnight Accommodation Amount - P 2,000
  • Towing Amount - P 5,000
  • Vehicle Removal Crane Services Amount - P 10,000
  • 10 Years of casa eligibility
  • 77 accredited repair shops
  • P 5,000,000 Maximum total insured

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