Motor Excess Protect, sometimes called Excess Insurance or Deductible Insurance, helps you pay the ‘excess’ or ‘deductible’ on your car insurance policy in the Philippines. Think of it as a safety net for your safety net, reducing your out-of-pocket expenses when you make a claim.
What Exactly is Motor Excess (or Deductible)?
Let’s break it down. When you get car insurance in the Philippines, the policy usually comes with an excess or deductible. This is the amount you have to pay yourself when you make a claim, before the insurance company pays the rest. It’s like this: Imagine you get into a fender bender and the repairs cost PHP 20,000. If your policy has a PHP 5,000 excess, you pay PHP 5,000, and the insurance company covers the remaining PHP 15,000.
The excess amount can vary widely depending on your policy, your car’s age, your driving record, and the insurance provider. Some policies might have an excess of PHP 3,000, while others could be PHP 10,000 or even higher.
Why Do Insurance Companies Use Excess?
Insurance companies use excess amounts for a couple of main reasons:
- Discouraging Small Claims: An excess discourages drivers from making frequent claims for minor damages. If every little scratch resulted in a claim, the insurance company would be swamped, and everyone’s premiums would go up.
- Reducing Premiums: Choosing a higher excess amount often leads to lower annual insurance premiums. This is because you’re taking on more risk yourself. Essentially, you’re saying, “I’m confident I won’t need to claim often, so I’ll pay more out-of-pocket if something happens.”
So, What is Motor Excess Protect Then?
Motor Excess Protect is a separate insurance policy that covers the excess you’d have to pay on your main car insurance policy. It essentially reimburses you for that PHP 5,000 (or whatever your excess is) up to a certain limit. This is helpful if you are in an accident and need to make a claim; you don’t need to shell out your excess.
Think of it like this: You have your regular car insurance (main policy providing comprehensive coverage). And you have Motor Excess insurance (provides coverage for your excess amount). You are in an accident. You claim your main insurance. You paid the excess. You file a claim with your Motor Excess Insurance to be reimbursed for that excess amount.
How Does Motor Excess Protect Work in the Philippines?
Here’s a typical scenario showing how Motor Excess Protect would work in the Philippines:
- You have a car insurance policy with a PHP 5,000 excess.
- You also have Motor Excess Protect, covering excess amounts up to PHP 5,000 per claim, maybe with a set annual limit, say PHP 20,000 for the year.
- You get into an accident and need to claim on your car insurance. The repair bill is PHP 30,000.
- You pay the PHP 5,000 excess to the repair shop (as required by your main car insurance policy).
- You submit a claim to your Motor Excess Protect provider, providing proof of the accident, repair bill, and the excess you paid.
- Your Motor Excess Protect provider reimburses you the PHP 5,000 (or whatever amount you paid as excess, up to the policy limit).
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Essentially, it bridges the gap and allows you to claim on your car insurance without the financial sting of the excess payment.
Who Benefits Most from Motor Excess Protect?
Motor Excess Protect isn’t for everyone, but it can be particularly beneficial for certain drivers in the Philippines:
- Drivers with Higher Excess Amounts: If you’ve chosen a higher excess on your car insurance to lower your premium, Excess Protect can provide peace of mind, knowing you won’t face a hefty out-of-pocket expense if you need to claim.
- Drivers with Newer Cars: Repairs on newer cars can be expensive, so even a seemingly small accident can result in a significant repair bill. Excess Protect helps cushion the blow.
- Drivers Who Are Very Careful But Still Want Protection: Some drivers are very skillful, but they know that accidents can still happen even when they are being cautious. Such as from other drivers. This is especially ideal for drivers who would claim if something happens even if it’s expensive.
- Businesses with Fleet Vehicles: The cost of claiming for multiple vehicles can quickly add up. Excess protect can bring down the cost of claims significantly.
- Drivers on a Budget: Although premiums are required, it can be a cheaper alternative to comprehensive protection. For times that you need to make financial claims, you will be covered for excess. Especially if you don’t have a good driving record, it can bring the costs down significantly.
What Does Motor Excess Protect Typically Cover?
Motor Excess Protect typically covers the following:
- The excess amount you pay when claiming on your main car insurance policy.
- Accidental damage, including collisions, scratches, and dents.
- Theft or attempted theft of your vehicle.
- Fire damage.
- Vandalism.
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However, it’s essential to read the policy wording carefully, as exclusions can apply. Common exclusions might include:
- Claims that are not covered by your main car insurance policy. If your main policy doesn’t cover the specific type of damage, Excess Protect won’t either.
- Wear and tear, or mechanical breakdown (unless caused by an accident)
- Driving under the influence of alcohol or drugs.
- Uninsured drivers (if you were driving without valid insurance).
How Much Does Motor Excess Protect Cost in the Philippines?
The cost of Motor Excess Protect depends on several factors, including:
- The excess amount you want to cover. The higher the excess covered, the higher the premium.
- The number of claims you can make per year. Some policies have a limit on the number of claims allowed.
- The overall policy limit. This is the total amount the policy will pay out in a year.
- The insurance provider. Different companies offer different rates so it’s important to shop around.
- Your age, driving record, and vehicle type. Just like with car insurance, younger drivers or those with previous accidents might pay more.
That said, most providers who offer Motor Excess Protection usually quote much cheaper premiums than comprehensive insurance. The price is usually dependent on the policy, excess amounts you want to cover, the number of claims, and insurance provider.
Finding Motor Excess Protect Providers in the Philippines
While less common than standard car insurance, Motor Excess Protect is offered by some insurance providers in the Philippines. The best way to find providers is to:
- Contact your existing car insurance provider: They may offer it as an add-on or know who does.
- Use online insurance comparison websites: Although not all websites specifically list Excess Protect, it’s worth searching.
- Speak to an insurance broker: Brokers can often find specialized insurance products that you might not find on your own.
When comparing providers, make sure to compare:
- The premium
- The cover limits (both per claim and annually)
- The exclusions
- The claim process
- The provider’s reputation for customer service
Important Considerations Before Buying Motor Excess Protect
Before purchasing Motor Excess Protect, consider the following:
- Is it worth it for you? If you rarely claim on your car insurance, the cost of the policy might outweigh the benefits. If you frequently claim and have a high excess, it might be a worthwhile investment.
- Can you afford the excess yourself? If you could comfortably pay the excess amount if you needed to, Excess Protect might not be necessary.
- Does it coordinate well with your current insurance? Ensure the Excess Protect policy aligns with your existing car insurance in terms of coverage and exclusions. You don’t want to end up in a situation where neither policy covers a particular event.
Making a Claim on Your Motor Excess Protect Policy
The claim process will vary depending on the provider, but generally, you’ll need to provide the following:
- Proof of the accident You will need to provide police reports filed for the accidents.
- A copy of your main car insurance policy.
- The repair bill.
- Proof of payment of the excess (e.g., a receipt from the repair shop).
- A complete claim form provided by your Motor Excess Protect provider.
It’s crucial to submit your claim promptly and accurately to avoid delays or rejection.
Statistics on Car Accidents and Insurance Claims in the Philippines
While specific statistics on Motor Excess Protect usage are not readily available, understanding the overall landscape of car accidents and insurance claims in the Philippines can highlight the potential value of this type of coverage. Unfortunately, comprehensive, publicly accessible data on car accidents and insurance claims specifically broken down for Motor Excess Protect is limited in the Philippines. However, general road safety and accident statistics can provide some context.
For example, reports on road safety from organizations like the Metropolitan Manila Development Authority (MMDA) often highlight key accident-prone areas and contributing factors. While these reports don’t detail insurance claims, they underscore the prevalence of road accidents, emphasizing the need for comprehensive coverage. A rise in registered motor vehicles also contributes to insurance risks such as motor accidents.
The Department of Transportation reported that there are estimated to be around 13.8 million registered vehicles in the Philippines in 2022. According to Land Transportation office, 2023 hit 14.3 Million in registered motor vehicles. A recent Philippine Statistics Authority (PSA) report highlights the growing number of registered vehicles, indicating the increased probability to meet accidents in the Philippines. This can be linked to the potential need for Motor Excess Protect, particularly for those seeking to mitigate out-of-pocket expenses after an accident.
Therefore, while specific numbers on Motor Excess Protect claims are hard to come by, the general understanding of traffic conditions and accident rates in the Philippines suggests a valuable role for such products.
Example Scenario: When Motor Excess Protect Makes Sense
Let’s imagine you own a small delivery business in Metro Manila. You have three vans constantly on the road. You’ve chosen a higher excess (PHP 7,500 per vehicle) to keep your insurance premiums manageable. One of your vans gets into a minor accident. The repair cost is PHP 25,000. Without Excess Protect, you’d have to pay PHP 7,500 out-of-pocket. But with Motor Excess Protect, you claim that PHP 7,500 back, shielding your business from unexpected expenses.
Now, imagine this happens a few times a year. The savings from Motor Excess Protection can quickly add up, making it a worthwhile investment for your business.
Motor Excess Protect vs. Lowering Your Excess
You might be thinking, “Why not just lower my excess in the first place?” That’s a valid question! Lowering your excess will definitely reduce your out-of-pocket expenses if you make a claim. However, lowering your excess will also increase your insurance premium. This is because it involves the insurance provider taking on more risk. Ultimately, deciding between Excess Protect and lowering your excess comes down to comparing the costs and risks involved.
Here’s a simple comparison:
| Feature | Motor Excess Protect | Lowering Your Excess |
|---|---|---|
| Premium | Potentially lower than increasing your car insurance premium | Higher car insurance premium |
| Out-of-Pocket Expense (Claim) | Pay excess initially, but claim it back | Lower upfront expense |
| Overall Cost | Depends on frequency of claims and cost of Excess Protect | Higher overall cost due to premium increase regardless of whether you claim or not |
| Best For | Drivers who want lower premiums but protection against excess costs, businesses with fleet vehicles | Drivers who want predictable costs and are happy to pay a higher premium. |
FAQ: About Motor Excess Protection
Here are some frequently asked questions regarding Motor Excess Protection:
What happens if the total repair cost is less than my excess?
If the total repair cost is less than your excess, you will have to pay the full repair cost yourself. Motor Excess Protect only covers the excess amount up to the claim.
Can I claim multiple times per year with Motor Excess Protect?
Yes, but your insurance policy will have a claim limit and a total coverage limit for the year. Read your policy carefully to understand these limits.
Does Motor Excess Protect cover damage to other vehicles or property?
No, Motor Excess Protect only covers your excess. Damage to other vehicles or property is covered under the third-party liability portion of your main car insurance policy (assuming you have that coverage).
Is Motor Excess Protect the same as “gap insurance?”
No. Gap insurance covers the difference between the amount you owe on your car loan and the car’s market value if the vehicle is totaled or stolen. Motor Excess Protect covers the excess, deductible or participation amount for your insurance when you make a claim on your car. These are two completely different insurance plans.
What if my main car insurance claim is rejected? Will Motor Excess Protect still pay out?
No. Motor Excess Protect only kicks in if your main car insurance policy approves the claim. If your main policy rejects the claim (e.g., due to a policy violation), Excess Protect won’t pay out either.
How long does it take to get reimbursed by Motor Excess Protect?
The time it takes to get reimbursed varies by provider. However, typically, it takes a few weeks after submitting all the required documents for claims to be processed.
References
- Metropolitan Manila Development Authority (MMDA) Road Safety Reports
- Philippine Statistics Authority (PSA) Reports on Registered Motor Vehicles
- Department of Transportation (DOTr) Statistics
Don’t let unexpected excess payments derail your budget. Protect yourself from unexpected expenses. Get a quote for Motor Excess Protection today and drive with peace of mind! Speak to your provider or broker for a detailed discussion. Don’t worry; you’ve got this!
