CTPL vs. Comprehensive Motorcycle Insurance: A simple guide for riders

Two-wheelers, particularly motorcycles, are quite popular in the Philippines, especially for the ease of riding required for everyday use and commuting. Furthermore, if you reside in cities like Metro Manila, Davao City, etc, the traffic congestion situation makes buying a two-wheeler a practical choice.

However, the story doesn’t end with buying a two-wheeler. As a rider, you also need the following documents: motor vehicle registration papers (OR/CR), driving license, and an insurance policy. All this paperwork together will make you a responsible rider, who can legally ride on the public roads, but will also guard you against unexpected and unfortunate events like collisions, accidents, etc.

If you are a new or prospective motorcycle owner, then make sure to get all these essential documents. While the LTO, i.e., Land Transport Office, takes care of the motor vehicle’s registration and licensing needs, it’s the insurance you need to figure out.

Motor Vehicle Insurance in the Philippines

The process begins with researching insurance providers and comparing the quotes, followed by analysing the policy for coverage inclusions and exclusions, and lastly reading the fine print both before and after (for errors) finalising the deal. While this is just an overview of the motorcycle insurance process in the Philippines, there’s much more that you need to understand and do.

We have already discussed motorcycle insurance and why it is important for every Filipino rider. It’s time to expand your knowledge further and discuss the two major types of car insurance policies in the Philippines - the CTPL (Compulsory Third Party Liability) and the Comprehensive insurance policy.

Before going ahead, here’s a snippet of information about motorcycle insurance in the Philippines, especially for those who haven’t read our previous blog.

Motorcycle insurance in the Philippines

Did you know that to be able to register your motorcycle at the LTO, you require insurance? Yes, so having motorcycle insurance isn’t just a smart and responsible move, but is legally required too. Here are some key pointers to note -

Motorcycle insurance is your first line of defence in case of unexpected events like collision, damage, accident, flood, vandalism, etc.
It doesn’t matter if you live in the city or the countryside (with less traffic and accidents), insurance is a must. It is required by the law.
In the Philippines, motorcycle insurance is broadly categorised into two segments - CTPL and Comprehensive insurance. While both offer protection, but operate at a different level; therefore, it is essential to understand the two in detail.

So, without further ado, let us begin understanding CTPL and Comprehensive motorcycle insurance.

Motorcycle CTPL Insurance

What is CTPL insurance?

Compulsory Third-Party Insurance is the most basic insurance policy out there. Further, it is also the bare minimum insurance a rider needs in the Philippines. Not to forget, you need this for registering your motorcycle at the LTO.

CTPL coverage

Wondering what protection CTPL offers and why it is considered as bare minimum insurance required by a rider? Let’s find out -

CTPL insurance offers financial protection to the policyholder against third-party injury/death caused due to the insured motorcycle. Here, a third party can be a pedestrian or another car or a motorcycle rider on the road. Nothing else is covered, not even the policyholder and the insured motorcycle; all the related expenses will be made out of the policyholder’s pocket.

Why is it mandatory? It offers a safety net to everyone using the public roads in the Philippines. Meaning, if anything happens to anyone due to a fault of a vehicle running on the road, the injured will be fully covered.

What if you don’t have CTPL?

If you still dare not have CTPL insurance for your motorcycle, here’s what you need to be prepared for -

No LTO registration for your motorcycle.
Legally not permitted to ride your motorcycle on the public roads.
If caught by authorities, you’ll need to pay a fine, or even your vehicle might get impounded.
In case of an accident involving your motorcycle, third-party liability will fall on your shoulders.

Advice: Do not think about skipping CTLP Insurance for a few pesos. In the long term, it will save you from legal trouble and take over third-party liability fully.

Is basic CTPL coverage all you need?

This is one of the most common questions asked in the motorcycle insurance arena, and the answers depend on several factors. Now, if you tick one or more of the boxes below, then CTPL insurance is enough; no need to spend money on comprehensive or other add-on coverages.

You do not ride often, and if you do, that’s within a limited, nearby area.
You just want to comply with the law, so the CTPL is just for LTO registration, which is a must.
For you, every penny counts, and you can't afford anything more than the CTLP insurance premium.
You live and/or ride in a relatively safe area with low chances of flood and theft.
You consider yourself a safe rider with no chances of mistake on the road.
You don’t mind taking the financial risk of not having a comprehensive insurance policy.

Photo from Freepik

Motorcycle Comprehensive Insurance

Unlike CTPL, comprehensive insurance is not mandatory, but it is highly recommended. Why? For the wide range of protection it offers to the policyholder, however, all this extra coverage comes at a cost, i.e., a high premium. Therefore, if your pocket allows, go for comprehensive coverage, as you never know what tragedy hits and when, especially on heavy traffic roads like ours.

Comprehensive insurance coverage

One of the biggest perks of comprehensive insurance is the crazy protection it offers to a motorcycle rider. The list includes protection against -

Acts of God (flood, typhoon, earthquake, etc.)
Collision coverage
Theft and carjacking
Fire & explosion
Riots, strikes, & vandalism
Damage due to some malicious acts
Personal accident coverage
Third-party property damage

Amazing, right? Well, to your surprise, some insurance companies also offer add-on coverage over & above comprehensive insurance. For instance, Roadside assistance, towing services, Loss of Pay, zero depreciation, and more. Surely, all this comes at an additional cost, but it does add value to the package.

Advice: Not every insurance policy is the same, don’t think that if your friend’s insurance policy from the same insurer includes a certain coverage, yours will too. Always read the policy thoroughly to avoid any surprises later.

Is it essential to have comprehensive insurance?

We won’t say that you can’t survive without comprehensive coverage for your motorcycle, no, that’s not the case. But it is also true that having comprehensive insurance makes your life much easier; it allows you to ride worry-free, knowing that if something bad happens, someone is there to safeguard your finances.

Having said that, comprehensive insurance becomes essential for a rider when -

Your’s is a brand-new, expensive motorcycle.
You live or ride in areas that are prone to flooding and/or have a reputation for vehicle theft.
You want to enjoy a stress-free riding experience.
You plan to resell your motorcycle in the future (getting comprehensive coverage will hike the unit’s value).

Motorcycle CTPL & Comprehensive insurance - Coming together

Are you thinking of getting both CTPL and comprehensive insurance for your motorcycle? We’d say, go ahead, you are making the right choice as the duo will offer you complete financial protection and peace of mind while on the go. So, you’ll get -

Vehicle registration
Third-party injury/death coverage
Financial protection against your medical bills, motorcycle repair & replacement costs, and even legal fees, due to all the acts covered under comprehensive insurance

CTPL vs. Comprehensive Motorcycle Insurance

It’s now time to compare CTPL and comprehensive insurance against different parameters, like cost, coverage, etc., to give you a better idea and understanding of the two.

Parameters	CTPL Insurance	Comprehensive Insurance
Required by law	Yes, CTPL insurance is mandatory in the Philippines.	Comprehensive insurance is not required by law, but it is highly recommended for motorcycle owners.
Owner coverage	It does not cover motorcycle owner injury/death.	It offers financial protection to the owner in case of an accident or damage.
Third-party injury/death coverage	It offers coverage against third-party injury/death.	It also offers coverage against third-party property damage.
Theft, fire, vandalism and natural calamities	Coverage against such acts is not offered.	It offers protection to the policyholder in case the motorcycle gets stolen, catches fire, or gets damaged due to a natural calamity
Add-on coverage	Not offered	Several add-ons are offered, like roadside assistance, towing service, loss of use, etc.
Cost	Quite affordable; starts at PHP 280.	It’s expensive compared to CTPL; it ranges from PHP 2,000 to PHP 9,000.

Bottom line

If you are a motorcycle owner in the Philippines, then you need to at least get Compulsory Third-Party Liability (CTPL) Insurance - it is not only required for registration of your vehicle, but will also protect against third-party liability (injury and death). However, if you are looking for wider protection, comprehensive insurance is the thing for you. While it comes at a higher premium, it offers coverage against a wide set of acts like natural disaster, fire, theft, vandalism, theft, and more. In case you are still not satisfied and wanna experience the ultimate peace of mind, opt for the add-on coverages offered by the insurance company.

FAQs

Q1.) What is motorcycle insurance & why is it needed?
Ans. Motorcycle insurance is a contract between you and your insurance provider, wherein the latter offers financial coverage against premiums (paid monthly or annually). It is essential because it frees you from financial liability like unexpected repairs, medical bills, and third-party liability.

Q2.) Does motorcycle insurance cover theft?
Ans. Comprehensive motorcycle insurance offers coverage against motorcycle theft.

Q3.) Are passengers included in motorcycle insurance?
Ans. Some motorcycle insurance policies include passengers; however, it’s best to confirm at the time of finalising the policy. It is advisable to go for a policy that covers both you and the passenger in case of an accident.

Q4.) What factors influence the cost of motorcycle insurance?
Ans. Factors like model, usage, and type of coverage influence the cost of motorcycle insurance in the Philippines.

Q5.) Are helmets covered in motorcycle insurance?
Ans. Most motorcycle insurance policies do not cover helmets; however, they are mostly covered if you opt for extended coverage.

Q6.) I have multiple motorcycles. Will I get an insurance discount?
Ans. Most insurance providers in the Philippines offer multi-vehicle discounts, wherein if you insure more than one motorcycle, you get to save by bundling the policies.

Q7.) Is it possible to cancel a motorcycle insurance policy?
Ans. Most insurers in the Philippines allow you to cancel the policy; however, each has varied terms that you need to check.

Q8.)What will happen if I sell my insured motorcycle?
Ans. In such a case, you can either cancel your insurance policy or transfer it to the new owner.