Here are the procedures to easily figure out how much your participation fee will be:
- Calculate the amount of your deductible. Multiply the FMV of your car by 0.5 or 1 percent (depending on vehicle type). If the total exceeds PHP 2,000 (or PHP 3,000 if you own a business vehicle), you must pay a deductible fee. Otherwise, you should simply pay the deductible fee that is required.
- Calculate the cost of depreciation. Multiply the cost of your vehicle repair or replacement part by the depreciation rate specified in your policy’s depreciation schedule. If your car is four years old, for example, your depreciation rate is 20%. If your vehicle is less than three years old, you can skip this step.
- Calculate the cost of your participation. To calculate your participation charge, add your deductible fee and depreciation fee (if applicable).
Sample Participation Fee Computation
For example, your four-year-old automobile with a fair market value of PHP 1 million gets involved in an accident, and a damaged part costs PHP 10,000 to replace.
- PHP 5,000 (deductible charge) + PHP 2,000 (depreciation fee) = PHP 7,000 (participation fee).
This means that if you file a claim for PHP 10,000 to have a broken car part replaced, you’ll have to pay PHP 7,000 for the participation charge, and your insurance company will cover the rest (PHP 3,000).
How much is participation fee for a car?
The premium is the amount you pay for your insurance coverage. This is usually calculated using the basic coverage package plus any additional items.
When you are in an accident and file a claim with your insurance company, you will be requested to “participate” in the cost. This is often a minor fee of.05-1 percent of the car’s worth. This is done to guarantee that you don’t take advantage of the insurance coverage by claiming minor losses and to dissuade people from filing false claims.
What is deductible in motor insurance?
A deductible on a car insurance policy is the amount you must pay out of pocket before the insurance coverage kicks in. For example, if you file a claim for Rs 15,000 in damages and the deductible is Rs 1,000, you would be responsible for paying Rs 1,000 toward the repair and the insurance will cover the remainder.
Comprehensive car insurance policy :
Protects against natural and man-made disasters causing loss or damage to the vehicle and its insured accessories. These disasters can be divided into two categories: natural disasters and man-made disasters. Fire, explosion, lightning, flood, typhoon, hurricane, storm, tempest, inundation, cyclone, hailstorm, frost, landslide, rockslide, fire, and shock damage due to earthquake are examples of natural calamities.
Burglary, housebreaking, theft, riot or strike, externally caused accident, malicious act, terrorist action, and damage while traveling by road, rail, inland waterway, or air are examples of man-made disasters. This policy also offers personal accident coverage, which covers the vehicle’s driver in the event of an accident while driving.
Personal accident insurance for passengers in the car can be purchased by the owner. A third-party legal liability insurance policy is also required. It shields the owner from legal culpability in the event of an accident that results in permanent disability or death, as well as property damage. It also covers fire and theft as long as the cars are parked in a garage and not in use.
Third Party car insurance policy :
The insurer and the insured are the two parties involved in an insurance policy. As a result, a third party is defined as someone who is not the insured or the insurer. Pedestrians, fare-paying and non-fare-paying passengers in a vehicle are the most common third parties. Third parties include the driver, owner, and passengers in the vehicle. Passengers who travel in public transportation, such as taxis, auto rickshaws, and buses, must pay a fare.
Non-Paying Passengers Passengers are those who are permitted to travel for free in a vehicle. Your legal duty for any compensation due to an accident caused by your vehicle is covered by the Third Party car insurance policy. It covers culpability for death or harm to other parties such as pedestrians, other vehicle occupants, and non-passengers.
Pillion riders and passengers in private vehicles are likewise considered covered. As the owner of the vehicle, you are covered in the event of death or harm to passengers in the vehicle for hire. In the event of death or harm, the liability is unlimited. The insurance policy will normally cover damage to the property of a third party.
What is authorized repair limit?
In addition to deductibles, insurance companies use a countermeasure known as the permitted repair limit.
An authorized repair limit is the amount that a policyholder can spend on repairs without obtaining approval from the insurance company. It’s normally calculated as the deductible plus the towing fee, but it’s always a good idea to double-check with your provider.
So, if you have a PHP 3,000 deductible and a PHP 500 towing fee, your permitted repair maximum is PHP 3,500. Don’t bother filing a car insurance claim if the repairs cost more than PHP 3,500 because it will be denied.
What is non Casa clause?
CLAUSE WITHOUT A CASE (FOR VEHICLES MORE THAN 60 MONTHS OLD) If the scheduled vehicle is damaged, including loss or damage to its attachments if they are covered, claims will be settled based on the reasonable cost of repair or installation at “non-casa” motor shop prices.
How much of car insurance is deductible?
The average vehicle insurance deductible is $500, which will generally be less than the cost of repairs in the event of a catastrophic accident if a claim is filed. You should not file a claim if the cost of repairs is less than your deductible. Any repairs below the deductible are not covered by your insurance, and submitting a claim can raise your insurance rate.
For example, if you are in an accident and only your windshield is damaged, it may cost roughly $400 to replace it completely. With a $500 deductible, you’d cover the entire cost rather than relying on your insurance, and you wouldn’t have to file a claim. However, if you are involved in a covered accident that damages the structure of your car and necessitates substantial repairs, the cost of repair might be north of $3500. With a $500 deductible, you would only be responsible for $500 of the repair costs, with the balance covered by your insurance company.
What is a 10% deductible?
After the deductible has been paid, several health insurance plans require policyholders to pay coinsurance. When you pay coinsurance, you and the insurance company divide a portion of the cost according to the conditions of your policy. Coinsurance is typically 10%, 30%, or 20%. For example, if you have 10% coinsurance and a $2,000 deductible, a $10,000 surgery will cost you $2,800 $2,000 for the deductible and $800 for the coinsurance on the remaining $8000.
What is standard deductible for auto insurance?
In general, drivers have deductibles of $500 on average. According to WalletHub, common deductible levels include $250, $1000, and $2000. You can also choose separate deductibles for comprehensive and collision coverage. You may, for example, have a $1000 collision deductible and a $500 comprehensive deductible, or vice versa.
WalletHub utilized a same method to obtain sample Progressive collision insurance quotes over a six-month period and discovered the following averages: