Car insurance is an important topic, and in our opinion every owner should acquire it. However, the local consumers do not go for car insurance in Pakistan for multiple reasons. So, in this article, we will discuss car insurance, its law in Pakistan, how is it beneficial for car owners? How does it work? What is the process of claim after an accident or theft? And what Pakwheels.com is doing to provide auto insurance? So, let’s dive in and discuss this crucial topic.
Law on Car Insurance in Pakistan
Surprisingly, there is a formal legislation on car insurance in Pakistan, which bounds every owner to insure their car. The law requires that the owners must have Third Party Insurance. This essentially means that other vehicles that face some damage in an accident, including driver injury, perpetuated by you must be compensated for their loss. Otherwise, you will face a fine and some degree of punishment. The law only exists in documents as there is no implementation in the country. A large number of people either don’t opt for vehicle insurance or don’t have any knowledge about it.
Types of Car Insurance in Pakistan
There are mainly three types of car insurance in Pakistan, which are:
- Third-Party Liability Car Insurance
- Comprehensive Car Insurance
- Collision Car Insurance
Comprehensive Car Insurance
This is the best car insurance type for the owners as it covers the driver, their car, and damages to the third party involved in the accident. Furthermore, this insurance covers you in case of all kinds of accidents, including floods, riots, theft, and fire.
This type of motor insurance allows you to claim for accidents that happened because of your fault. Then, in case of theft, it will help you replace the car easily. Moreover, it will cover you whether it was your mistake or not in case of an accident. And last but least, it provides ease.
Third-Party Liability Insurance
As told you earlier, this insurance covers the damages of the third party after an accident due to your fault. However, it doesn’t cover damage to your car and theft of your vehicle. This insurance will only pay for damage to a third party’s car and injuries of the driver/passenger of the other vehicle. In short, it will protect you against damage caused by you.
Collision Car Insurance
This insurance covers the damage to your car by another vehicle in an accident, crash with an object like a fence, and single-car rollover accident. Importantly, this insurance doesn’t cover damages due to natural disasters or weather conditions in Pakistan.
Furthermore, collision car insurance doesn’t cover injuries to other drivers in an accident, accidents with animals, theft/vandalism, and losses other than auto damage in a collision.
How to Get Car Insurance in Pakistan
There are three ways:
- Car Finance
- Car Company
- Pakwheels.com
In the first case, it is a must to get car insurance because the bank will not hand over the car to you without it. Secondly, you can get insurance through the car dealership from which you are buying your car. You can tell the dealership about your preferred car insurance companies after calculating various car insurance quotes with the help of a car insurance calculator.
The third and simplest method is to visit Pakwheels.com and get car insurance online from the comfort of your home. You simply need to follow the steps listed below:
- Visit Pakwheels website and visit the car insurance section
- Put your car details and select the car insurance company of your choice.
- Team PakWheels will call you for confirmation and refer your request to the relevant company.
- The insurance company will contact for pre-inspection scheduling and documents.
- “Cover note” will be issued for 7 days (a trial period) after the pre-inspection report is received.
- The policy will start from the day when “Premium” is paid, and the policy will be issued in written form as well.
- Furthermore, a surveyor from the company will do a pre-inspection of your car to check the car’s condition in detail.
Also, PakWheels offers the facility to consult a car insurance calculator so that you can calculate all possible expenditures related to the car insurance policy. This car insurance calculator will be a great facility for you and help you make an informed decision.
How to Claim Car Insurance in Pakistan?
Most importantly, it depends on what kind of insurance you have; if it is comprehensive, all of your losses will be covered. Meanwhile, specific damages and losses will be covered in the other two types of insurance. So, there can be different scenarios for claiming the policy, which is:
- Theft/Vandalism
- Accident (Total Loss)
- Accident (Partial Loss)
Theft/Vandalism
In case of theft of your car or a part of your car, you have to follow these steps:
- File a police report/FIR about the theft or vandalism
- Contact your car insurance company, tell them about the incident, and file a claim. The company will send you a confirmation message.
- If you have gotten your car from a bank, visit that bank and fill out the claim form.
- In the car company’s case, visit its dealership and share the essential documents. The exact process is applied by the insurance company.
- You have to hand over the police report, CNIC, and Car Registration Card.
- If your car is vandalized, meaning some part is stolen, then a surveyor from the company will visit you to confirm the vandalism.
- Then the surveyor will estimate the damages, and the process will start as you and the company will decide on a workshop/dealership for reinstalling that spare part; you will visit that outlet and get the new part.
- It is important to remember that you have to pay a specific percentage of whole payment, also called depreciation, and it will only be applicable only on parts, not on car paint.
- Also, in case of car theft, the process may take a longer time period, and the insurance company will offer you payment or a car as a replacement, depending on the car make.
Accident (Total/Partial Loss)
As mentioned earlier, if you have comprehensive insurance, it will cover your and third-party’s damages. Meanwhile, Third-party car insurance will only cover the loss of other person if the accident happens due to your fault. Before telling the process, let us tell you that there are two types of accidents, i.e., total loss (40 – 60% damage of your car) and partial damage to your vehicle.
Moving forward, in case of an accident:
- Call the car insurance company, and it will appoint a surveyor, and they will check the estimated loss.
- Surveyor will assess and prepare a report.
- The insured car can either go to the appointed workshop on the insurance company’s panel or go to a workshop of his own choice.
- We suggest you visit the workshop on the company’s panel because the insurance company will undertake all expenses (except depreciation).
- Meanwhile, in case of the workshop of your choice, the owner will pay all dues on his own at that time, while the insurance company will reimburse the payment within 15 to 30 days after receiving the surveyor’s final report. It means it will be more hassle for you.
What is Depreciation?
We have mentioned the word “depreciation” a couple of times above, and you may be thinking what it is? Worry not, we will tell you. In easy words, depreciation is the percentage of the money you will pay in case of accident or theft. If your car is new, you will pay 5% depreciation within six months of purchase and 10% after a year. And it will continue to increase by 10% on an annual basis, and its maximum limit is 60%.
In other words, as your car gets older, the depreciation will continue to rise with the passage of every year: the older the vehicle, the higher the depreciation.
Age Chart of Car Insurance in Pakistan
Most of the companies cover ten-year-old vehicles for car insurance in Pakistan, but some offer plans for 2005 onwards as well. So, if you own an old car, check the company’s policy before getting insurance.
What Car Insurance Doesn’t Cover
The car insurance in Pakistan does not cover:
- Lamps, tires, mudguard, bumper, and paintwork.
- The insured vehicle/ accessories damaged due to fire by an external explosion,
- Self-Ignition or Lightning during regular running hours while in any garage or on the road.
- Lastly, commercial vehicles are only covered in the case of “Total Loss.”
Is Car Insurance in Pakistan Transferable?
The insurance policy cannot be transferred to a person, but it can be transferred from one car to another. It means the plan can be transferred from vehicle to vehicle, which means the client can avail adjustment for his new car for the remaining tenure.
Geographical Boundary of Insurance
Most of the car insurance companies cover the loss/damages across the country. However, there are some companies who deal provincially, so always check this aspect before getting a policy.
Does Insurance Cover Mechanical Losses?
No, car insurance covers accidental losses not mechanical.
