Car Insurance Roundup: Why Opt For Third Party Car Insurance?
Very few of us have ever gone shopping for car insurance. Maybe it’s because of the way our system work. The moment you get to the nearest Post Office to pay for your vehicle license, you are told “you can’t buy the license if you are not insured” really? Anway the moment you hear those words, you want the quickest way out of that place and you are usually ambushed by Insurance Touts usually selling third-party insurance outside post offices and you cave in. Once it’s in your system, you will always opt 3rd party insurance.
Is Third Party Insurance Good?
For the pocket, in the short run, it is. In the long run, third-party insurance ( Third-party insurance is an insurance policy purchased for protection against the claims of another. In case you accidentally bump into someone’s car the insurance will pay for the damages) is not good. Why, because of 2 reasons 1 you are putting tremendous props on yourself as a good driver who will never have any other accident except bumping into someone’s vehicle. 2 depending on your vehicle the premiums between the first party and the third party are not mind-blowingly different. The opportunity cost for choosing first-party insurance or comprehensive insurance far outways the dollars you will save by buying third part car Insurance.
Why Do People Opt For Third-Party Insurance In The First?
- Some just have strong faith in their driving and the conditions of their vehicle, therefore, don’t feel the need to spend more on sunk costs.
- Most motorists believe they are paying for something they will never make use of.
- There is a general belief that full cover is expensive and very few people check to compare the differences and calculate the opportunity cost in forgoing one for the other.
So Why Must I Forgo Third Party Car insurance?
Because no one can predict anything on the road, therefore, you just need to be prepared for the utmost worst every time.
One of them is the fact that in the event of an accident, this insurance would not protect you from the damages occurred to your vehicle. The money you will probably spend paying for the damages to your vehicle will be so many times over the amount you would have paid for a first party car insurance in some instances. I remember with my old car, First Party was $210 a year. If I was involved in an accident there was no way I would have paid $210( that year) to get it back to an ok condition. Cumulatively it may seem like you are paying too much when paying for first party car insurance, but considering these payments are made once a year or once per term, we can’t really talk of the money we paid last year when nothing happened because it’s already a sunk cost like rent.
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Let’s say your car is stolen or damaged due to fire, your third-party policy would not be of any help. While these cases are few in Zimbabwe, they do happen. In case of these 2 tragedies, you will have to count your losses and probably buy a new car.
Why pay for insurance that will only take care of other people’s vehicles and not your own car. If you have utmost faith in your driving that you won’t be involved in an accident, how about if your car is stolen or if it burns, what will happen?
I honestly Cant Afford Comprehensive Car Insurance What Can I Do?
- You can strike up first party car insurance payment terms with your insurance provider. Contrary to what we think or made to believe, there are a few insurance providers who are open to this notion. Approach them, see if they are open to such an arrangement if not approach another provider until you succeed.
- Upgrade to third-party car insurance that covers theft and fires in case this eventuality happens.
- Become a very cautious and careful driver obviously.
