What is the purpose of car insurance?

Car insurance is like an invisible layer of protection for your automobile and whatever it hits given third-party liability is in effect. In the event that something happens to your ride, insurance will be there to help you shoulder the costs associated with repairing and even protecting you and your vehicle as well as cover expenses that you may incur. That’s the purpose of insurance in a nutshell. Like most things in this world, it gets a little more complex than that. Let’s get a little more specific. 

Spending money to save money seems counterintuitive, but insurance is there to keep you from spending more money. Car insurance will help protect your financial standing in case you get into an accident and get issued a repair quote that will shake up your bank account. Getting an insurance policy is on average more affordable than getting a major repair done to your car. That being said, if you have to shoulder the cost to repair another vehicle, the right insurance policy will be able to help you cover the costs. 

The term "totaled" is an insurance term that means that the cost to repair your car exceeds a certain percentage of its value. The vehicle is written off as a total loss by the insurance company, and you may recoup your money if ever this happens. The terms and payout will depend on your policy and your insurance provider. 

It’s a dangerous world out there filled with sharp edges and corners that can scratch up your paint and destroy your car’s bodywork. Driving can also endanger your life, as a high-speed accident may result in bodily harm or injury to you, your family, or people around you. That being said, the right insurance policy will help you foot the bill in case of any unfortunate accidents, and repair your car. 

Following an accident, you will be left with a damaged car, no injuries—hopefully, and a lot of wasted time. You also have to put in the time to get your car to a shop or the dealership to get it repaired. Heaven forbid that you need to spend time in the hospital and find a way to pay for everything. Good insurance providers with the appropriate policies will help you pay for your bills so you won’t be turning over your couch cushions trying to scrounge up money to pay off your bills. As a bonus, a good insurance provider will also have accredited service centers and shops that they can go to in order to get your car repaired, which means you won’t have to lift a finger. 

Right after an accident occurs, it’s also much simpler to present an insurance policy rather than to negotiate your way through to a settlement with a third party. A good insurance provider will also have towing services at the ready to assist you in case your car is unroadworthy. 

Compulsory Third-Party Liability (CPTL) is the most basic car insurance that you will need to drive in the Philippines. Without it, you cannot legally drive your car on the road. It’s a part of registration, but the best kind of insurance will be a comprehensive policy. CPTL will only cover the third party that is affected by the vehicular accident. You and your car will not be covered, so it would be best to get a comprehensive insurance policy from a reputable insurance provider.