Buying a car in the Philippines or anywhere else in the world isn’t just about paying the purchase price. Instead, it’s an investment that involves several expenses, both minor and significant, that the owner will incur as long as they have the car. If we break down the costs of car ownership, we’ll see the following components: price, insurance, registration and taxes, maintenance, running costs, and depreciation.
Among these components, insurance is one of the most crucial yet often overlooked factors, especially if you are on a tight budget. If you're looking for a reliable car with low ownership costs, consider a vehicle with a low premium. Generally, a lower premium indicates a less expensive car with lower maintenance costs.
Additionally, you are in luck, as this guide is perfect for you. Why? Here, we list some of the cheapest cars to insure in the Philippines, along with factors that influence premiums and tips to help you save money on insurance. But before all that, it’s essential to understand the basics of car insurance and premiums in the Philippines.
So, let’s begin…
Car insurance in the Philippines - What it means and why it matters
Car insurance is a safety net provided by an insurance company to a car owner in exchange for a premium. This safety net offers financial protection against accidents, theft, and damage.
In the Philippines, every car must have at least Compulsory Third Party Liability (CTPL) insurance, which covers injury or death of a third party and is required for vehicle registration. Additionally, car owners are advised to obtain comprehensive insurance that covers damage to their insured vehicle. The table below provides a brief comparison between CTPL and comprehensive insurance.
|
CTPL insurance |
Comprehensive insurance |
|
|
Car insurance premium - What it is and how it’s calculated
What is a car insurance premium? It is the cost you pay to the insurance company to get the vehicle insured against potential risks, such as accidents, fire, theft, and natural disasters. It can be considered a membership fee, which you pay to get protection against the unexpected.
How is the insurance premium calculated? Insurance premiums don’t work on the one-size-fits-all principle. Not even two cars have the same premium, as companies take into consideration several factors to determine the cost of coverage they are offering. This includes -
- Vehicle type and value: Expensive cars typically have higher premiums, while compact or low-value cars often have lower premiums.
- Car age: Older cars may have lower premiums compared to brand-new units that require more coverage.
- Driver’s profile: Driver’s age and driving history influence the premium cost, as insurers assign a risk score based on these factors as well.
- Driving history & claim record: Safe driving habits in the form of a clean record and few claims are rewarded by insurers.
- Usage: Vehicles used for personal use are cheaper to insure compared to those used for commercial purposes.
- Location: Living or commuting to an accident-prone or high-crime location can increase the premium.
- Coverage type: CTPL insurance is generally more affordable than comprehensive insurance. Add-ons further increase the premium.
- Safety features: Cars equipped with safety features like ABS, airbags, and GPS tracking often qualify for insurance discounts.
- Deductibles: Choosing high deductibles can lower the premium.
- Modifications: Modified cars often attract higher premiums.
Photo by FreepikCar insurance cost in the Philippines
Let us have a look at the average car insurance cost in the country -
|
Type of insurance |
Est. cost |
|
CTPL |
PHP 600 - PHP 1,200 |
|
Comprehensive |
PHP 8k - PHP 20k (for economy cars) PHP 20k - PHP 60k (for SUVs & luxury cars) |
Cheap cars to insure in the Philippines
Here are the top budget-friendly cars with affordable premiums -
|
Toyota Wigo |
In addition to being backed by the Toyota name, the Wigo has a reputation for being a reliable and low-maintenance car. |
|
Suzuki S-Presso |
The S-Presso is a compact-sized car with low repair costs, which in turn is a low premium. |
|
Mitsubishi Mirage |
The Mirage has a strong reputation amongst buyers for being fuel-efficient. Plus, its parts are readily available, meaning quick repair. |
|
Honda Brio |
The Brio is a safe and efficient car loved by many Filipino families. It also has a moderate insurance cost. |
|
Toyota Vios (base 1.3L model) |
The Vios is a well-rounded sedan renowned for its stylish design, reliability, safety, and comprehensive features. It is also popular among insurers for its easy repair and part availability. |
|
MG3 |
This one is not as popular as the others, but the hatch is slowly gaining popularity due to its affordable price tag. |
|
Geely Emgrand |
A good option for buyers looking for a sleek and stylish car that is also affordable to insure. |
|
Changan Alsvin |
This emerging sub-compact sedan is available with competitive insurance premiums. |
Tips to lower your car insurance premium
- Compare quotes from multiple providers—don’t settle for the first offer. Online comparison tools can be invaluable.
- Installing safety devices, such as dashcams and alarms, can make your car appear safer and more reliable to insurers, potentially lowering your premium.
- Choosing higher deductibles can boost the insurer's confidence in you, resulting in lower premiums.
Photo from FreepikInsurance companies in the Philippines
There are many insurance providers in the Philippines, but here are a few to consider (in no particular order):
- Malayan Insurance
- Oona Insurance
- Pioneer Insurance
- AXA Philippines
- Prudential Guarantee
- BPI MS Insurance
- Standard Insurance
Bottom line
Do you want to save money on insurance? If yes, then we’d suggest buying cars that attract a low premium. There are a few cars that have a significantly low ownership cost, which includes factors like insurance, registration, taxes, maintenance, running costs, and depreciation. While most of these parameters are not under control, insurance cost can surely be influenced. How? By picking up a car that’s from a reliable brand, low on maintenance and can be easily repaired.
FAQs
Q1. What car brand is cheapest to insure in the Philippines?
Ans. Several brands are affordable to insure, Toyota being one of them, all thanks to its low maintenance costs and easy availability of parts.
Q2. Is the CTPL insurance package enough for my car?
Ans. CTPL insurance is mandatory in the Philippines, but it typically offers limited coverage, primarily for third-party injury or death. Consider upgrading if your car is new, under loan, parked in unsecured or flood-prone areas, or if you want more comprehensive protection.
Q3. Can car insurance be bought online?
Ans. Yes, you can obtain quotes from various providers and apply for the policy that best fits your needs and budget.
Q4. What documents are needed for online car insurance?
Ans. Typically, you'll need your vehicle’s OR/CR, a valid ID, and vehicle details.
Q5. Does car insurance cover natural disasters, such as floods and typhoons?
Ans. Yes, if your policy includes Acts of God/Nature (AON) coverage. AON is usually part of comprehensive insurance or available as an add-on.
Q6. I have a budget car. Should I invest in comprehensive insurance?
Ans. Although it may be more expensive, comprehensive insurance is highly recommended for those who live or commute in high-risk areas.
Q7. Can I switch car insurance providers mid-year?
Ans. Yes, you can switch providers at any time if your current plan no longer meets your needs or budget.
Q8. Is same-day insurance available in the Philippines?
Ans. Yes, Zen Insure offers same-day coverage when documents and payments are verified.
Q9. How often should I renew my car insurance?
Ans. Car insurance in the Philippines typically lasts one year, so annual renewal is required.
Q10. What is the best insurance company in the Philippines?
Ans. Many reliable providers exist; the best depends on your needs and budget.
Q11. How does the car model affect insurance costs?
Ans. Cheaper, low-maintenance cars are generally less expensive to insure, whereas those with high repair costs or a higher risk of theft tend to be more costly.
