I’ve talked a little about insurance in the past on this site, but mostly those articles have been related to health insurance, and medical issues. The other day, somebody left a comment here on LiP asking about insurance, but instead of health insurance, he was asking about other types of insurance. He specifically mentioned flood insurance, basic contents insurance and such.
I have had some personal experiences with insurance here, and I thought that this would probably be a good time to share my experiences along these lines.
The person who asked about such insurance is PaulB. Paul left the following comment on my recent article about Warranties in the Philippines. Paul wrote:
Thanks for the information.
My request is a little along the path from warranty…. Can and does Insurance operate in the Philipinnes! I want to get basic contents, flood insurance for the house we have just built. Any ideas how I go about this,? Who would do you recommend in Davao? If I did get it, would it pay up if required? I think the answer is ” Are you kidding!” but I thought its worth a comment…..
I offered this reply to Paul:
Hi PaulB – I am going to do something on this comment that I have never done before… I am going to specifically NOT answer your question. The reason is because what you are asking is too complicated to put in a comment. I need to write an article about this, and I will do that soon. So, tune in again, and I will write an article in the next 2 weeks answering your question about insurance, and my experience with insurance in the Philippines.
The reason that I did not answer Paul’s query in the comments was several fold:
- Not all readers of the site read all of the comments, especially on an article that is a few days old already. Since this is an important topic, I wanted to give the topic a little more proper venue than in a comment, a place where everybody interested would see that the information is available.
- The topic is a little complicated, and perhaps too long-winded for just a comment, and actually deserves fuller coverage in the way of an article.
- I felt that the topic of Insurance was quite different from the topic of the previous article – Warranties, so I decided to make it a new article altogether.
As I said earlier in this article, I have indeed had experience with insurance here in the Philippines. When living in the West, in the USA for me, it is the common practice to have insurance on practically everything you own. It is just part of our western culture to carry such insurance. Here in the Philippines, most people do not carry insurance on many of the things that a westerner would normally insure.
Car insurance is mandated by law here, however, the amount of insurance that you must carry is very small. In the past, I carried full insurance on my vehicle. However, as my car is now over 10 years old, I no longer carry such full coverage insurance. I go with the minimal insurance that is required when you register your vehicle. I personally would recommend getting full coverage if your vehicle is relatively new, perhaps newer than 5 or 6 years old.
As a renter, we do not need to worry about homeowner’s insurance, that is the responsibility of the house owner. So, this is not something that I concern myself with at all. If you are renting your place of residence, though, the thing you need to think about insuring is your household belongings. This would include anything in your house – furniture, appliances, whatever is under your roof. Homeowner’s insurance is readily available here, as is insurance on the contents of your dwelling place.
Other types of insurance are also readily available. I am sorry, but I do now know about flood insurance, though.
Now, let me relate my experience with insurance, and you can decide what kinds of coverage you should have, based on my experience.
In 2000, we moved to General Santos City. One thing we found there was that we experienced earthquakes on a fairly regular basis. We had contents insurance on our goods, but that insurance did not cover earthquake damage. If you wanted earthquakes to be covered, you needed to buy a separate rider for your insurance policy to cover any damages from earthquakes. Upon consideration, Feyma and I decided that it would be a good idea to purchase an earthquake rider for our policy, so we inquired with an insurance agent that we knew. I do not recall the price of the earthquake coverage, nor does Feyma, but I have it in my mind that it cost us about P15,000 in 2000, which at that time was roughly $375.
On New Years morning, 2002, at about 5am, we were shaken from our sleep by a 7.2 Magnitude quake in General Santos City. It was a real shaker! I have experienced many earthquakes in my life (I’ve lived in California and other earthquake prone areas), but never one of this size. I honestly thought at the time that we may die in the quake! As it turned out, thankfully, we all lived through the quake, but there was substantial damage to much of our belongings in the house. Things like bookshelves, cabinets and such were almost all shaken to the point that they fell over. Dishes fell from the cupboards. Many things were broken.
After everything calmed down, the cleanup effort began. Mostly it was a matter of picking things up, putting them back in place and such. I told Feyma to contact the insurance agent so that we could find out what to do in relation to our insurance coverage. The agent told Feyma to gather any broken items into one place so that they could be inspected and a claim made. So, this is what we did. The agent was supposed to come and visit our house to check on the damage.
Notice I said “supposed to”. Well, she never came. We went to the office and some papers were filled out, but that was the end of it. Nothing was ever paid to us. No further contact came from anybody in the insurance company, except for frequent inquiries from us, but nothing in return.
This experience turned my mind around about insurance in the Philippines. I cannot say for sure that this experience is common, or normal, but what I know is that it was my first and only experience with insurance in the Philippines. After this, we have pretty much gone with only very minimal insurance at all, and mostly no insurance at all. Things that must be insured, like the car, have the minimal insurance required. Other than those minimal policies, I consider myself to be self-insured. If something is broken or destroyed, we just replace it ourselves. Is there risk in this? Sure there is, but life has risk.
So, PaulB, this is my experience with Insurance in the Philippines. Your experiences may vary from this, and I wish you the best of luck in this type of thing.