Car insurance in the Philippines: CTPL, comprehensive and filing a claim

Two kinds of car insurance

Every registered car in the Philippines needs Compulsory Third Party Liability insurance, or CTPL. The Insurance Code makes it unlawful to operate a motor vehicle without it, and the LTO won't register or renew a car until the insurer has sent the certificate of cover.

Comprehensive insurance is optional under the law. If you are paying off a car loan, though, the bank will require it for the life of the loan, and many owners keep it after the loan is paid. The two are separate policies, and you usually buy CTPL when you register.

What CTPL covers

CTPL pays for death or bodily injury that your car causes to third parties, such as pedestrians and people in other vehicles. It does not pay to fix your car, the other car, or a wall you hit. Many first-time owners don't realize this until after a fender bender.

Insurance Memorandum Circular 2024-01 doubled the CTPL limit for death indemnity to ₱200,000 per person and raised the no-fault indemnity to ₱30,000 from ₱15,000. No-fault means the insurer pays that amount without anyone having to prove who was negligent, as long as the claim comes with proof such as a police report and medical or death records. Premiums stayed at their 2006 levels: ₱560 for a one-year private car policy, plus small IT and authentication fees. In 2025 the Insurance Commission released a draft to raise the limit again to ₱400,000, so ask your insurer which limit your policy carries.

Under the Insurance Code, a notice of claim against CTPL must be filed within six months of the accident or the claim is waived.

What comprehensive adds

A comprehensive policy is a bundle. The exact mix varies by insurer, but a typical private car policy includes these parts:

• Own damage and theft: repairs to your car after a collision, fire or malicious damage, and payment if the car is stolen.
• Excess bodily injury: liability for injuries to others above what CTPL pays.
• Third party property damage: repairs to another person's car, gate or property that you damaged.
• Auto personal accident: fixed benefits for the driver and passengers if they are hurt or killed.
• Optional add-ons: Acts of Nature, roadside assistance, and sometimes a loss-of-use allowance.

Acts of Nature and flood cover

Standard own damage cover usually excludes typhoons, floods, earthquakes and volcanic eruptions. To be covered you need the Acts of Nature (AON) add-on, which raises the premium. Ask for two quotes, one with AON and one without, so you see the real price difference.

If you live, park or commute anywhere that floods during the rainy season, we'd treat AON as part of the policy rather than an extra. One flooded engine can cost more than many years of the add-on.

Read the flood exclusions closely. Some policies exclude engine damage caused by starting or driving a car that is already in deep water. After a flood, leave the engine off, take photos, and call the insurer and a tow truck.

Participation fee and depreciation

The participation fee is the amount you pay out of pocket each time you claim, similar to a deductible. It can be a fixed peso amount or a percentage of the insured value, and your policy schedule states which. Some policies set a higher participation for AON claims. For small scratches, paying the shop directly can cost less than the participation fee.

Depreciation shows up in two places. First, the insured value drops at each renewal to follow the car's market value, so a total loss in year four pays far less than the original price. Second, many policies deduct a depreciation charge on replacement parts once the car passes a certain age. The schedule is in the policy wording, so check it before you renew.

How to file a claim, step by step

• Make the scene safe. Turn on hazard lights and set up your early warning device. If someone is hurt, get medical help first.
• Take photos of all vehicles, plates, damage, the road and any traffic signs. Get the other driver's name, license, plate number and insurer.
• Report to the police or traffic enforcer and request a police or traffic accident report. For theft, report to the police right away. For a minor single-car incident, some insurers accept a notarized affidavit instead.
• Notify your insurer or agent as soon as possible, ideally the same day. Most policies require prompt written notice.
• Submit the claim papers: claim form, copy of the policy, OR/CR, driver's license, the police report or affidavit, photos, and a repair estimate from an accredited shop.
• Wait for the adjuster to inspect the car and approve the estimate. The insurer then issues a letter of authority to the repair shop.
• Pay the participation fee and any depreciation charge to the shop when you pick up the car, and inspect the repair before signing the release.

If the insurer is slow to pay

The Insurance Code gives the insurer 30 days to pay a non-life claim after it receives proof of loss and the loss has been assessed. If the assessment isn't done within 60 days, payment is due within 90 days of receiving the proof of loss. An insurer that unreasonably delays can be made to pay interest at twice the ceiling set by the Monetary Board.

If your claim stalls, ask for the reason in writing. If that goes nowhere, file a complaint with the Insurance Commission.

Buying tips

• Get at least three quotes at each renewal. The dealer's tie-up insurer is convenient but not always the cheapest.
• Check that the insured value matches the car's current market value. Too high wastes premium; too low shortchanges you on a total loss.
• Ask which shops are accredited and whether dealer repairs are allowed for a newer car.
• Read the exclusions: unlicensed or drunk driving, use for hire, and racing are standard. If you plan to drive for a ride-hailing service, tell the insurer first.
• Save the insurer's hotline and your policy number in your phone. A paper copy in the glove box won't help much if the car is stolen.