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For many Filipinos, a car is more than a mere utility. It is a sign of accomplishment, a social status and a symbol of one’s hard work paying off. Aside from serving individual mobility needs, it is also a family’s primary means to enjoy moments together, travelling and creating memories as they go through the journey of life. 

That is why, there is nothing more heartbreaking to a car owner, and more so a car enthusiast, than seeing his car slowly disappear under flood waters during a deluge. The recent floods caused by back-to-back typhoons Rolly and Ulysses only highlight the helplessness of car owners against the wrath of nature. 

While we do have preventive measures to get our cars safely out of harm’s way, there is an element of time involved in order to make these happen. Given ample warning, we can transfer our vehicles to higher ground or multi-level parking facilities in order to keep them safe and dry. Commercial establishments for example, have learned their lessons from Tropical Storm Ondoy in 2009 and now regularly offer free parking space as refuge for vehicles during a strong typhoon. 

But the sudden rise of water levels, oftentimes happening during the night or, as with Ulysses, with unexpectedly rapid pace, leaves car owners distraught with the inability to protect one of their most prized possessions. 

It is during times like these, as what the onslaught of Ondoy had once taught us, that the importance of having a comprehensive insurance policy with Acts of God (AOG), or Acts of Nature (AON), coverage is once again brought to the limelight.

For brand-new car purchases that go through financing, this is already a standard inclusion. Of course, banks would want to see the property they funded through the car loans they provided to buyers, protected from loss. Car dealerships and lending institutions have been quite creative in making this more affordable and accessible to a car buyer. 

“Some insurance companies have made staggered payments for comprehensive insurance policies possible,” says Joy Mariano, a top-selling automotive sales consultant from Mazda Alabang. “Other insurance companies  provide policies for free during the first year of ownership with the condition that the owner will keep renewing the same insurance policy until the full amount of the vehicle has been settled. But for cash buyers, this is not a requirement,” clarifies Mariano. 

This is also true if you are buying a second hand car with your own money. And this is where the pain of loss can potentially overwhelm a car owner. 

A flooded car, especially one that has been completely submerged, is almost always declared a total loss by insurers. And it is not just an arbitrary call by either the owner or the insurance company. “An insurance company or provider determines the repairability or admissibility to be written off of flooded vehicles based on a procedural system,” shares Eric Deguito, a Branch Manager of Alpha Insurance & Surety Company, Inc.

“First, a thorough inspection is required and that is normally provided by the casa or an accredited motor shop. That inspection would conclude the auto parts to be replaced or repaired via a written report inclusive of the labor cost. Thereafter, that report will be submitted to the claims department for final assessment and approval,” explains Deguito.

And while many insurance companies can take days or weeks to declare a loss, there are two other indicators that a vehicle will most certainly be written off. “Submerging points are the factors wherein we establish the affected level of each vehicle such as flooring, seats or if the water reaches the dashboard. Because a higher water level equates to a higher risk of the vehicle being considered as total loss,” adds Deguito. 

Second is the cost of repair as Deguito reveals. “Another circumstance is when a casa or accredited motor shops’ evaluation and quotation exceeds 75% of the sum insured, the insurance company automatically deems it as total loss. That implies that 75% below is the cut-off cost of repair.”

In broad strokes, this is where insurance companies draw the line. And while the amount of money that will be handed over to you to cover the cost of the vehicle may vary depending on age, mileage, and depreciation rates, it is still better than receiving nothing for your loss. 

While car owners who are not bound by their insurance policies may opt to have their vehicles repaired, this will be at their own expense. Even with a comprehensive insurance policy, the owner will still bear a portion of the cost of any repair. The complexity of today’s modern cars with their multitude of computer boxes, sensors and electronics, all make repair jobs a financial nightmare. And seriously flooded cars that are resurrected for duty will almost always never run as smoothly or feel and smell as fresh as before.

But what happens to your car if it is declared a total loss? Deguito gives as an idea. “After further process of total loss declaration and settlement with the policy holder, vehicles that are written off are then endorsed for detailing. This to consequently sell to “salvage buyers” or any party or entity interested through a bidding process.” Car heaven is not as rosy a picture as we once thought, especially when we know that our once valued ride will end up sold in pieces.

So what should car owners do to avoid this tragic fate? Simple, invest in your car’s comprehensive insurance policy. Make sure it includes the Acts of God or Acts of Nature coverage. And do so every year while you retain ownership of your vehicle. 

A comprehensive insurance policy with AOG coverage  is not only for flood damage, it also covers earthquakes, typhoons, as well as other physical damage, bodily injuries resulting from vehicle collision, theft, fire, or any damage that might happen during the course of your ownership. And with our country so prone to natural disasters, road incidents and even carnapping, the odds are we will make use of the benefits of this type of insurance at least once during the span of our ownership. 

According to Mariano again, the cost of comprehensive insurance depends on the bank or lending institution’s ongoing promotions. “A comprehensive insurance policy for a subcompact ranges from P30,000 to P35,000. A compact sedan’s policy can go from P45,000 to P48,000. A pickup policy can cost you from P50,000 to P55,000. A popular compact crossover, from P55,000 to P60,000.  And a 7-seater SUV policy can cost from P65,000 to P70,000.” 

And true, these are not cheap. But neither is a brand new car. 

If you are one of those now asking where to have your flood-damaged car restored after Typhoon Ulysses, well, the answer would have been much easier to come by had your car been enrolled in a comprehensive insurance policy. As they say, there are no regrets in life. Just lessons learned. 

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