Driving without car insurance in the Philippines: 8 alarming consequences you must know

Hello car owner, wanna feel safe and protected every time you hop in your car? The only way to do so is by getting your car insured, trust us - this will get you sorted and let you enjoy every drive, be it work or leisure, to the fullest. And when it comes to the Philippines, car insurance is all the more important, given the unpredictable nature of our roads, drivers, and even pedestrians, for that matter. Frankly speaking, it doesn’t matter if you live in the city or countryside, car insurance is a must, as accidents or theft have no boundaries. For instance, you might be cruising around the lush greens and a livestock appears out of nowhere, leading to a collision or car damage while protecting the animal, either way, having insurance will relieve you from all the financial stress. Or say you are travelling through the busy roads of Metro Manila and you bump the car ahead, here also, your car insurance will take care of third-party damages. Now, if you are new to the world of car insurance, here’s a quick intro. However, for a more thorough understanding of the topic, we’ll suggest you to go through our detailed blog on car insurance.

Car insurance in the Philippines - A quick revision

Car insurance is nothing but a financial agreement between the car owner and the insurance provider, wherein the latter promises to cover the cost of accident, theft or damage to the car in exchange for a monthly premium. Overall, it is a safety net protecting you from sudden financial stress involving your car. Thus, enabling you to lead a stress-free life. When it comes to car insurance in the Philippines, you’ll definitely encounter two terms: Compulsory Third-Party Liability (CTPL) insurance and comprehensive insurance. The former is mandatory by law and is needed for LTO car registration, so it is necessary to legally drive your car. As for coverage, it is quite minimal, restricted to third-party death and injury, and so it is affordable. Comprehensive insurance, on the other hand, is not required by the law, but is highly recommended. Why? Because of its wide scope of coverage that prepares you and your car against all kinds of damages - accident, theft, fire, flood, riot, vandalism, and more. For the same reason, this one is quite expensive. For a more detailed idea of car insurance costs in the Philippines. Click here.

Photo from Freepik

How important is car insurance?

Answer - Very much, so much so that it is compulsory in the Philippines for every vehicle. As mentioned, CTPL insurance is required during registration at the Land Transportation Office (LTO). Not just that, car insurance is essential because of the following provisions: financial safeguarding, legal compliance & security, and mental peace. To elaborate -

Car insurance will save your hard-earned money. Every time your car gets damaged due to an accident or something else, you won’t be required to pay anything from your pocket, insurance will take care of everything - be it medical bills or some repair or replacement work
Car insurance, even the basic CTPL, will keep you in the good books of the law and save you from fines and penalties.
Be it flood, fire, or theft, knowing that you are covered by car insurance takes away all the stress.

Now, you say? Isn’t it important and beneficial?

No car insurance - Here are the consequences

Still not convinced to get car insurance? Let's check out the consequences you’ll have to face for this decision.

Penalties & fine If caught driving without car insurance by the authorities in the Philippines, you will be looked down upon as an offender of the law. The consequences of which include - getting fined, possible suspension of driver’s license, and no vehicle registration at the LTO.
Impounding of the vehicle If you are caught by the authorities without insurance while involved in an accident, chances are your vehicle will be impounded. The situation accelerates when you are at fault and are not able to pay third-party damages.
Financial liability after an accident or car damage Without car insurance, you end up paying every repair or replacement cost, medical bills, property damage, legal fees, etc. There’s no help, the entire burden is on your shoulders, and mind it, the expense could go from a few thousand to even millions of pesos.
No protection against theft/natural disaster/riot With no car insurance, comprehensive to specific, you are left completely unprotected against several risks, with all the financial burden falling on your shoulders. So, you have no financial protection against vehicle damage, theft, vandalism, and natural disasters.
Stress due to loss of business In case you depend on your vehicle for livelihood and it gets damaged due to any reason, no coverage could leave your vehicle unrepaired for weeks or months, affecting your earnings badly.
Consequences of hitting a pedestrian In case you hit a pedestrian with your car, without insurance, you’ll be left taking charge of the injured’s medical and hospital bills. Not to forget the legal consequences you will face if you are at fault.
Criminal charges (in severe cases) When an uninsured car is part of an accident involving serious injuries or death, the owner, in most cases, ends up facing criminal charges. Further, there is no one to take care of compensation and legal costs.
No difficulty in getting compensation If you are uninsured and involved in an accident that is not your fault, it can be challenging to claim compensation from the other party.

Cost of driving without insurance - Case studies

Case I: You bump into a parked vehicle Without insurance, you have no coverage against third-party injury/death and third-party property damage. Leaving you with the sole responsibility to cover the repair cost that could be PHP 10,000 or more, depending on the car. Also, if the other party sues, you’ll have to pay the legal fees by yourself. However, with car insurance, you’ll be free from the above-mentioned expenses.

Photo from PHM

Case II: You get involved in a major car accident If you and your car are a part of a major car accident involving damaged vehicles and injured passengers, and are without car insurance, get ready to pay the following from your pocket: medical bills and repair costs for the involved cars. Further, you might face a legal lawsuit wherein your vehicle might get impounded and you get severe jail time.

Tips to secure affordable car insurance

We hope by now you are convinced to get your car insured, however, if you are worried about managing your monthly premium, here are a few tips to secure a pocket-friendly deal. Research and compare This one is the number one rule. Research about all the available insurance providers, shortlist the ones you feel confident about, and request quotes from them. Next, compare the policies, in terms of inclusions, exclusions, cost, and customer feedback. A small tip, use online comparison tools for the purpose. Bundle your policies If you have multiple cars or assets that need insurance, rather than insuring them individually, go for a bundle policy with a single company. This might get you a discount. Don’t over-insure When it comes to car insurance, picking the right coverage is important. Take your sweet time to decide what you need. Here you can factor in your driving skills, your driving route, your locality, etc. There is no point in overpaying for something that’s not needed. Here are some coverage suggestions from our end -

CTPL insurance
Comprehensive insurance
Acts of God
Personal accident
Roadside assistance

Evaluate your buying option In the Philippines, you can purchase car insurance from multiple sources like car dealerships, banks, or online brokerage companies. Each comes with its own set of pros and cons, in terms of insurance cost and customer service. Ask for a discount When out there to buy car insurance, don’t forget to ask for a discount. You can get discounts on the basis of safety features in your car, your driving habits, etc. Bottom line If you are a car owner in the Philippines, then driving without insurance is not an option. Furthermore, the legal trouble and financial consequences that you’ll face without car insurance are just not worth it. It doesn’t matter if yours is a brand-new car or a pre-loved unit, or if you are a new driver or an experienced one, understanding the importance of car insurance and then getting the essential coverage will save you unnecessary stress, time, and money. Here we’d also like to add that while CTPL insurance is mandatory by law. Still, if you choose not to get it, it can lead to a fine, penalty, and even impounding of the car in some cases, but remember, it is not enough, as it offers coverage against third-party injury/death. If you need protection for yourself, your passengers & car, get comprehensive coverage. FAQs I have only CTLP insurance. Will it offer enough protection in case of an accident? CTPL insurance will only cover third-party injury/death in case of an accident. It offers no protection to you or your car. Will I still get coverage in case someone else was driving my car? Here, you have to check your car insurance terms; often, no coverage is offered if an unauthorised driver is involved. Is it essential to renew my car insurance policy? Yes, if you want to continue enjoying the financial protection offered by the car insurance policy. Make sure to initiate the renewal process before the policy expires and to avoid any gap in the coverage. Can I drive my car without insurance in the Philippines? It is illegal in the Philippines to drive a car without CTPL insurance and could lead to a fine, penalty, or even the impounding of the vehicle in some cases. What is the cheapest car insurance policy available in the country? Compulsory third-party liability insurance is the cheapest option. It costs between PHP 600 and PHP 1500, depending on the vehicle. However, it offers limited coverage.