Automobiles are indisputably high up on many people’s list of life’s necessities, and saving to buy one is a common endeavour.
After people buy their cars, and regardless of whether they are new or used, motor insurance becomes an essential need if owners want to protect themselves against theft, accidental damage or fire. Voluntary motor-insurance policies fall into many categories, and what you need will generally depend upon your risk aversion and how much you can afford to pay.
If you are an extremely risk-averse car-owner, you will need comprehensive coverage, although that is expensive. Premiums are determined by the age of your car and your claims history.
Comprehensive policies usually provide collision coverage no matter what it is your car hits, as well as covering bodily injury or loss of life of passengers, drivers and third parties, damage to third-party property, fire, theft and bail bonds.
Typically, insurance companies don’t bother playing dirty tricks if the insured car’s driver is not at fault and the crash is not a serious one.
However, there are many stories about insurance companies playing tricks to avoid claim payments if vehicles and property are seriously damaged and the insured cars are more than 10 years old.
I know of one case in point. It concerns a driver losing control of his car on the Expressway and becoming involved in a collision with another vehicle.
The damaged car was taken to a garage recommended by the owner’s insurance company, but the owner felt this garage was incapable of restoring the car to good condition. So he took it to another garage that had no regular business relationship with the insurer.
The owner was forced to undertake all of the claim procedures himself rather than these being handled by the garage and the insurer. The latter spent a week checking the cost of spare parts and three weeks after the accident had still not indicated who would take charge of the repairs or approve an auto-salvage purchase.
Then the insurer proposed buying the vehicle, because it was made in 1994 and not worth the cost of repairs. It claimed the policy allowed it to opt for auto-salvage purchase if the estimated cost of repairs amounted to more than 80 per cent of the insured sum. However, the right of approval for this procedure remained with the vehicle’s owner, and in any case repair estimates were less than 80 per cent of the insured sum.
Failure to make timely contact is a regular insurance-company ploy to force policyholders to sell damaged vehicles for auto salvage instead of getting them repaired.
The owner of the car in question spent nearly a month attempting contact with the insurance company before it eventually agreed to repairs.
Buyers of car insurance must accept that insurers adopt such tricks to protect their own interests, and even comprehensive policies will sometimes fail to get cars back on the road as fast as companies will have owners believe in the sales process.
Pwangkaew Bunnag, a car-owner with a comprehensive insurance policy, says she has had no bad experiences with her insurance company, because her car is only three years old.
“It’s possible that motor-insurance companies might offer different services for new and old cars,” she says. “Prices for new cars are relatively high, and it’s worthwhile repairing them if they’re damaged.
“Besides, premiums for new cars are higher than those for old cars. I think this is unfair, because service from insurers should be equal regardless of the age of the car.”