19.12.2022 • Liisi Toots
So you have insurance, but you’re not being compensated? Here’s why
We understand the customer’s frustration if, in the case of an accident, they receive a response that their claim is not covered by their insurance. For example, vandals have broken your car’s windows, but that is not covered by your Motor third party liability insurance.
The reality is that there are different types of insurance coverages which cover different damages. In this blog post, we want to raise your awareness about these different types of insurance and invite you to assess your risks – and consider Casco for your vehicle.
Two types of insurance for your vehicle
The insurance company cannot compensate damages that aren’t included in your insurance coverage. For cars, you can choose two insurance products – Motor third party liability insurance (also known as MTPL or Traffic insurance) and Casco.
Option 1: Traffic insurance (compulsory)
Traffic insurance is compulsory – all cars on the road must have this. This is the insurance that covers any damages you cause to other people and vehicles on the road. It does not cover any damages you cause to your own vehicle.
Traffic insurance is similar all over Europe and insurance sums take care of personal injuries and disabilities for up to 5,6 million euros and damage caused to things such as cars, buildings and lamp posts up to 1,2 million euros. Every car that takes part in traffic should have active traffic insurance cover.
So, you need to be alert that you will have a continuous policy ( you cannot take part in traffic when the car is without Traffic insurance!). The only exception when you don’t need Traffic insurance is when the car is not in use.
Sometimes customers with Traffic insurance believe that they have complete insurance coverage for all damages, but this is false. Traffic insurance does not cover the damages to your own car. If your car and passengers are victims of, for example, a car collision (some other car caused the accident), then this other car’s traffic insurance will cover any resulting damages to your car and affected passengers.
Option 2: Casco insurance (optional, but recommended)
The other type of motor insurance is Casco insurance. This is voluntary insurance where the owner can protect their own car. For example, in cases when you are the liable party in the accident and traffic insurance will cover the damage to other cars, Casco would let you claim insurance for any damages to your own car, as well.
Casco insurance also covers theft and vandalism. So, if vandals broke your car’s window and you have Casco – you can file a claim. But, if you only have Traffic insurance – then vandalism isn’t covered and your insurer won’t be able to cover any damages.
Casco insurance protection comes in handy when you don’t have sufficient resources to repair your car at any point of time. If one can repair the car at any point with their own money, they don’t need the insurance.
Is insurance pricing unfair?
Insurance premiums are calculated based on the risk of the car and its usage. For example, insurance companies rate the risk for taxi drivers as high because they spend more time on the road and therefore the insurance premiums are high. But, one might argue that the more you drive, the more experienced you are.
Plus, the way insurance pricing decisions are made for taxis is by considering ALL taxi insurance accident history and applying these trends to individual drivers. But this doesn’t account for the personal experience and behaviour of the individual driver.
Cachet is here to change that
Our goal is to make insurance prices affordable to ride hailing drivers based on their actual driving hours as a taxi plus taking into account their driving habits. Many companies say that they want to be customer centric – we say we want to be person centric. Cachet stands for your rights and helps to negotiate with insurance companies in order to get fair insurance premiums for platform workers.
The main argument to insure via Cachet is the flexible pricing – you only pay based on your actual driving habits:
- if you drive less than 40 hours a week, you can pick a smaller Casco package and save a lot of money vs other offers
- changing your policy when you decide to change how frequently you drive your taxi is just a couple of clicks away
- with the Cachet app, you can track your driving history and find the most suitable deal for you. It can also be used to conveniently submit claims in case of an accident
One more thing about Casco insurance for taxis. Some people buy a regular Casco for their car, even though they drive it as a taxi, because it is cheaper. The risk here is that the insurance company can decline the claim or reduce the indemnity proportionally by how much you paid less for regular Casco compared to Casco for taxis. Some insurance companies are asking for a 3-5 times higher deductible, if the proper usage type has not been selected. In order to avoid disputes after an accident and make sure you get full coverage, it is always worth buying the right insurance for taxi usage – both traffic insurance and a comprehensive Casco plan.