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Different types of car insurance

A Guide To
The Different Types of Car Insurance

Just like a real estate property, your car is a major investment that you need to protect. Nowadays, we hear and see accidents happening here and there. For this reason, having car insurance has become a necessity. Getting involved in an accident is expensive when paid out of your pocket. It also gives you peace of mind that any accident-related expenses will be covered by your provider. 


However, finding car insurance can be daunting given the plethora of coverage options available. When planning to buy one, you need to do your research in ensuring that you will get the right one for your needs. In this article, we shall take a look at the different types of car insurance available for you to choose from.

1. Compulsory Third Party Liability (CTPL)

Compulsory third party liability insurance is required by law under Section 373c Chapter VI of the Insurance Code of the Philippines upon registration. CTPL covers the costs of damages or injuries caused to a third party as a result of an accident or collision.  With a CTPL, the third party and their immediate family will receive financial assistance of up to P100,000. The coverage amount are as follows: 


  • For the death of the third party, P70,000 for indemnity and P30,000 for funeral expenses. 
  • For any injuries to the third party, the P100,000 will cover hospitalization expenses worth P500 a day for a maximum of 45 days and medicine expenses worth P20,000
  • For permanent dismemberment, the TPL insurance will cover P50,000 for loss of limbs, hands, fingers, toes, and feet as well as loss of sight for both eyes and total disablement


However, CTPL does not cover damages or injuries that you or your passengers will incur during the accident. Thus, you need another type of insurance for your protection and that of your passengers during an accident. 

2. Comprehensive Car Insurance

What CTPL does not cover, comprehensive car insurance will. Since CTPL has a maximum limit of P100,000, any excess amount can be covered by a comprehensive insurance policy. It is not mandatory but will provide you with a wider scope of coverage. 


Comprehensive car insurance provides coverage for acts of nature, theft and vandalism, property damage, injuries, disability, hospitalization, and others. Comprehensive car insurance is more expensive than CTPL, which is self-explanatory already. This type of insurance is ideal if you want an all-around policy that will spare you from making out-of-the-pocket payments.

3. Collision Coverage

Collision coverage pays for the cost of repairs to your vehicle when it is hit by another vehicle or object. Collision coverage can be used whether you are at fault or not. Unlike other types of car insurance, there is no limit for coverage. It will usually be based on the actual cash value of your vehicle. However, you will be responsible for paying your selected deductible. 


Collision coverage pays for damages that happen when your car hits another vehicle, is hit by another vehicle, and hits an object like a fence or sign. Collision insurance will only provide coverage for damages to your vehicle. However, it will not pay for damages to another vehicle or property. Also, collision coverage does not cover all damages to your vehicle like theft, vandalism, floods, fire, or hitting an animal. 

4. Uninsured Motorist Insurance

Not every car owner has insurance coverage. If you happen to come across one in an accident, it can become troublesome for you especially if they are the ones who were at fault. Normally, they will be the ones who should shoulder the costs for repairs or damages to your car. But since they do not have one, that could be a problem.  


This is where uninsured motorist insurance comes in. With this kind of policy, you can get protection from the cost of damages or repairs incurred from an accident or collision with the vehicle of an uninsured motorist. Uninsured motorist insurance can be useful if the other driver has insurance coverage that is not sufficient to cover the costs of damage or repairs to their car as well as yours.

5. Personal Injury or Accident Insurance

Car insurance does not have to cover just your car but can also protect your passengers as well. Personal injury protection shoulders certain medical expenses and loss of income resulting from an accident. Personal injury also known as “no-fault insurance” pays out accident-related expenses regardless of who is at-fault.


Depending on your insurance policy, personal injury/accident can pay for 80 percent of medical and other expenses that you incurred from an accident. This is not a mandatory policy but it can be a great add-on to your current insurance policy. It might be a little costly but you can’t put a price tag on peace of  mind. 

6. Medical Payments Coverage

Medical payments coverage is more specific. You can’t claim anything else except medical bills from an accident. It covers medical costs of personal injury from an accident regardless of who is at-fault.  It is another nice to-have coverage on your car insurance as medical bills can be expensive when added up. 

Medical payments cover things like doctor’s visits, medical treatments, surgeries, and procedures, ambulance fees, and others. This type of coverage shoulders the medical costs of the driver and passengers. It can also cover you as a passenger in another car.

7. Gap Insurance

Gap insurance is a kind of specialized insurance that you can get for your vehicle. Your car’s value can depreciate rather quickly so an auto insurance settlement might not be enough to cover the cost of the loan if your car is under financing. 


With gap insurance, you can cover the amount you owed on a car loan if your car is totaled or stolen. If your vehicle has not been fully paid yet, gap insurance is highly recommended.

8. Classic Car Insurance

This type of insurance is more geared towards classic cars. It provides specialized coverage that caters to the unique needs of car collectors of vintage or classic cars. You will be surprised to know that the premium rates for classic car insurance is much lower than that of a modern car because they spend more time in the garage than on the road. 


With classic car insurance, it might be a good idea to consult your agent or insurance provider. When finding the best deals, make sure you understand the terms and conditions of the policy before signing it.

An Assurance.PH car insurance policy provides you with the protection that you need during accidents on the road while driving your vehicle. Get in touch with an Assurance.PH advisor for more details at / 09157052031 or 09052050402.

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