Five Reasons You Might Need Car Insurance

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“She is not just four wheels and an engine. She is home” -Author Unknown

Owning a car is possibly one of the biggest investments you can make. And what do you do with your investments? You protect them with insurance. Protection aside, there is a myriad of reasons why you would need auto insurance—in some cases, it is required by law, and at other times, it is also for your own protection. Seeing as the car is already a big investment by itself, you might think that having auto insurance is just another unnecessary expense. But take note, if you can afford to buy a car but not insurance, then you cannot afford to purchase a car. In any case, before you buy a car insurance in the Philippines, here are some excellent reasons to strengthen your resolve to do so:

1.) It is required by law

In the Philippines, traffic mayhem is rife which makes auto insurance essential. By law, you are required to get basic Compulsory Third Party Liability car insurance (CTPL) to protect against possible liabilities to third parties. Third parties could be anyone but the driver, passenger, family member or household member of the one who owns the vehicle. CTPL is necessary as it would protect any pedestrian from potential damages or injuries that might have resulted from driving and use of an insured car. The coverage extends from body injuries to deaths that could be up to a hundred thousand pesos. However, damage or loss of property is not covered by CTPL and is limited in this regard.

2.) Your car is an expensive asset

The average brand new car in the Philippines would cost you almost half a million. As a result, it would be the second most expensive purchase most individuals would make in their lives. Furthermore, most people would buy cars as it would make any of their trips convenient owing to the service they provide to their owners. With all this combined, you can easily see how protecting it adequately is paramount. Getting yourself car insurance is one way to protect this new asset.

3.) You cannot have a new car without it

In some cases, you cannot purchase a new car that includes a loan as you would not qualify if you do not have a full auto insurance policy. Additionally, you would not qualify to lease a vehicle either. Most lenders would want the assurance to be paid. So, as a necessary consequence, if you figure in an accident without car insurance to defray the repairs, you would not be able to pay the company that provided you with a car loan. To ensure you keep paying this, you should get your car insured.

4.) Cars are important

If you use your car on an everyday basis and skip on car insurance, you would not be able to use your car if you get into an accident while driving it. This is especially the case if it sustains damage wherein you cannot afford to have it repaired. Repairs and fixes are things covered by auto insurance and would help you get to where you need to be and make your necessary daily trips more convenient.

5.) Provide legal protection

No matter how cautious and mindful we are, accidents are an inevitable consequence of driving—whether we like it or not. Furthermore, accidents that involve third parties would likely land you in a legal snag—regardless of whether it is your fault or theirs. This means that there is nothing stopping anyone from suing you and even if you do win the case, you would still have to pay the necessary fees in litigation. Your auto insurance would help you and serve as a buffer between any legal claims and your wallet. Some coverages would include providing an attorney to handle lawsuits arising from automobile accidents.

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Five Things You Should Know About Auto Insurance

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In the Philippines, the average brand new car costs almost half a million pesos nowadays. Considering the exorbitant price you pay, it is readily assumed that your vehicle is one of the biggest investments you would ever make in your life. To protect this expenditure and asset, getting an auto insurance should not be a matter of the question when—but rather, it should be automatic. For this reason, it is imperative to include an auto insurance when you are calculating your budget. After all, you would not only be paying bills to defray the cost of your car loan—but your car insurance as well.

However, do not just simply buy whatever auto insurance you can immediately find. You need to be a little meticulous about how you select an insurance for your car—take into account more than just the monthly premium you will be paying and think about what the insurance policy actually covers. Experts may encourage you to buy as much auto insurance as you can afford, but this is not necessarily helpful. To have a better understanding of what you are paying for, it is best if you know the basics of how it works and which coverage you should have and skimp on. Understand what the best auto insurance coverage is for you and select that. So, if you are planning to buy a car insurance in the Philippines anytime soon, here are a few things you should know:

1.) Some of the most helpful coverages are the cheapest

Typically, liability insurance would be the most expensive and as it should be. Most common coverage limits would mean that your insurance is on the hook for a great deal of money for any kind of damage that you do. However, not all coverages are the same, and most of them would be capped by the value of your car. You might neglect to get optional coverages such as roadside assistance, rental reimbursement, and gap coverage but these are actually necessary for optimal protection with just a little price increase. Paying a bit more than usual would not be all for naught. After all, it could potentially save you a lot of money in the future.

2.) Many factors would affect your insurance rate

Your car insurance rate does not only depend on the make and price of your car. Depending on the auto insurance company, the criteria can mean a myriad of things when it comes to evaluating an insurance application. Guidelines in each company differ in the sense of which drivers they want to accept and ow much they would charge those groups they consider to be at a higher risk. Underwriting is the term given to the process of evaluating an application. It is usually done automatically and by a software behind the scenes.

3.) Insurance prices vary by company

Much like how life insurance prices differ from one company to another, auto insurance prices vary a lot by company as well. This is because each company has its own formula to assess and evaluate a risk. From there, they will evaluate how much you pay for the coverage. As a consequence, no two insurers would offer the same price for the same policy. Considering this, comparing prices is paramount to choosing the best insurer. After all, if you do not compare rates, you would likely end up overpaying or lacking in some coverages.

4.) You will potentially pay more if you let your policy lapse

Auto insurance companies view drivers who have licenses but without car insurances as reckless, irresponsible and risky. Considering this, letting a policy lapse means that you are likely to pay more when you do buy insurance. Prevent this, make sure to acquire and pay for your car insurance before your current policy is canceled.

5.) Discounts can make a significant difference

You might think a safe driving record, anti-theft devices, and car safety features are negligible things, but it actually contributes to a significant difference in what you pay for your auto insurance. Many companies would offer you discounts for this such as this—most especially if you opt to pay in full.

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