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13 April 2022

Comprehensive Car Insurance Benefits

Two cars facing each other

If you’re planning on driving a car on Hong Kong’s roads, then the car needs to be insured.

Under Hong Kong Law, any vehicle obtaining registration to operate on a public road must show proof of a minimum level of insurance protection. This minimum level is known as “third party car insurance” and represents the most basic coverage it possible to receive in Hong Kong and still satisfy your insurance requirements to the law.

Comprehensive Car Insurance”, as you may have guessed by the name, offers a far higher level of protection than a Third-Party policy, but comes with a much higher cost. Newer more expensive vehicles will normally be covered under a Comprehensive policy, while older more generic models will usually see the protection of a Third-Party plan. This is simply due to the fact that Comprehensive insurance, with a much broader scope of coverage, is far more expensive than any third-party protection.

But that expense comes with a number of benefits that don’t exist on Third-Party only policies.

Third Party Car Protection

This type of coverage is mandated, under law, by the Hong Kong Transport Department and represents the minimum level of protection required to drive on Hong Kong’s roads. At law, every driver and vehicle must be covered for HK$ 100,000,000 in respect to Third Party Death or Bodily Injury, and HK$ 2,000,000 for third party property damage.

All car insurance in Hong Kong starts with Third-Party Liability at its core. This means that when you purchase an insurance policy for your vehicle you will receive insurance coverage against any damage to third-party property you may cause. You also receive insurance against your risk of causing a third-party injury while driving.

Third-Party means “someone else.” So, if your accelerator got stuck and your car jumped the curb running into a building and damaging that structure, your insurance would cover your liability towards the owner and/or tenants of the building for the damage you caused.

Third Party Protection is included in all Comprehensive Motor Vehicle insurance coverage. But where Third Party insurance plans will normally go no further in their benefit offerings, comprehensive products offer much more.

Claim Free Discount Protection

All car insurance products in Hong Kong provide a no-claims discount (NCD) to policyholder. If a policyholder is claims free for 5 or more consecutive years, then they may receive up to 60 percent off their total premium.

However, it is possible under some Comprehensive Motor Vehicle Insurance plans to receive “Claim Free Discount protection.” Under this benefit, if the policyholder does not exceed a specific claim limit (normally in the region of HK$50,000) per period of insurance, then the policyholder does not lose any existing premium discounts they may have earned via an NCD. This is unusual as any claims submitted under a Third-Party car insurance policy will result in the immediate loss of all previous no claims discounts.

It is important to note that while NCD can be transferred to different insurers, NCD preserved via a Claim Free Discount Protection benefit will not. As such, if you have received protection under your plan preserving your NCD status, that status will normally no longer exist if you chose to move your car insurance to a different insurance provider.

Medical Expenses following a Car Accident

Part of the core coverage provided by Third-Party car insurance protection is your financial liability towards accidents you cause ending injury or death. However, because this is Third Party liability that financial coverage is provided to other parties to indemnify the policyholder. As the owner of a Third-Party Car Insurance coverage, you often enjoy no personal benefit from your policy; it exists to protect other people from you.

Under some Comprehensive Car Insurance plans, as the policyholder, you can receive medical protection even if you were at fault for the accident.

Under a comprehensive car insurance plan in Hong Kong if the policyholders or named drivers of a vehicle experience a bodily injury as a result of an accident which results in Death, total or patrial blindness, or dismemberment of hands or feet, then it is possible for a Comprehensive Car insurance plan to compensate the injured parties up to HK$ 100,000. In addition to this, a comprehensive plan may also indemnify the insured, their named driver, or any other occupants of the vehicle up to HK$ 5,000 following a violent traffic accident.

While this benefit is highly restricted, having the additional protection of a Comprehensive Car insurance policy to supplement your personal accident or Hong Kong health insurance plan can prove invaluable. This is especially true for individuals who have no supplemental insurance beyond their car insurance protection.

It is not recommended that you solely rely on the highly specified amount of health insurance protection afforded to you by a Comprehensive Car Insurance policy.

Windshield Replacement and Roadside Assistance

If you have a third-party car insurance policy and your windshield cracks or breaks, you’re largely on your own; its up to you to pay for the fix.

Under many comprehensive car insurance policies in Hong Kong, however, it is possible to receive a benefit that allows you to have windshield cracks and repairs done, for free, under your plan. If the cost to fix your windshield is less than HK$ 4,000 then many comprehensive car insurance products will cover that, free of charge, with no deductible payment required.

In addition to this, many insurers offer comprehensive policyholders complimentary 24-hour emergency roadside assistance and towing. As long as the individual cost for each assistance situation is lower than HK$ 2,000 and the cost for any tow is less than HK$ 2,000, then these services can be provided, free of charge, to the policyholder.

This type of coverage can be invaluable in the event that your vehicle suddenly breaks down. Depending on the fix, the insurer may (at its own expense) opt to repair the vehicle on the side of the road, or choose to have it towed to a garage. Obviously having your car towed is an inconvenience, so in addition to the roadside assistance provisions of many Comprehensive Car insurance plans, there is an additional benefit covering the use of a hire car, or rental, while awaiting your vehicle to be returned to functionality.

While roadside assistance is available to third-party car insurance policyholders, no matter what the cost of those services the insured individual will have the burden of those costs place on their own wallet.

Comprehensive Car Insurance in Hong Kong

Comprehensive Car Insurance is more expensive than a Third Party Only policy, or even a Third-Party Fire and Theft Car Insurance plan, but it comes with far more utility and impact on your everyday life.

If you would like to learn more about the excellent comprehensive car insurance options available in Hong Kong, please Contact Us to arrange a free, no-obligation consultation with one of our expert advisors.

Alternatively, you can request a free car insurance quote comparing the options best meeting your specific needs by completing the short form at the top of this page.

Whatever your insurance needs, don’t forget to Ask CCW – we’re simplifying your insurance.

About Author

Michael Lamb is an insurance industry professional with many years of experience within the Hong Kong Insurance market. Focusing on APAC coverage issues, Michael is able to provide extensive analysis and insight to a range of pressing topics. Previously, Michael provided insurance broker Globalsurance.com with their most highly valued articles and was a key influence in the development of all the content on Pacificprime.com, Michael has a passion for insurance matched by few others in the region.

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