The cost of comprehensive car insurance varies based on factors like the location, vehicle’s value, driver’s history, and chosen coverage limits.
The comprehensive insurance is a policy coverage that helps replace or repair your car as a result of theft, fire, vandalism, accidental damage or collision. The cover could also include legal liability arising from death, property damage or bodily injury to a third party.
All stemming from the use of the insured’s vehicle. If you own your vehicle, it’s a voluntary coverage on your car insurance policy.
However, if you lease your car or it is under a higher purchase arrangement, you may have to hold comprehensive car insurance.
Cost of Getting Comprehensive Car Insurance
The cost of Comprehensive car insurance in Nigeria varies significantly based on so many factors but on average, falls within the range of 3% to 5% of the vehicle’s value. It can range from ₦150,000 to ₦250,000 or more annually. It covers every risk pertaining to driving or owning a vehicle. For this reason, it is perceived as one of the most expensive insurance policies.
However, the cost of this insurance on a particular vehicle is largely dependent on the cost of the vehicle.
In Nigeria, to buy a comprehensive insurance policy, most insurance companies charge between 3% – 7% of the total value of your vehicle yearly. The value placed on the car is the cost of buying the car. Some insurance policy offers additional services like car tracking devices at a price. This is only available to a comprehensive car insurance policy holder.
Upon complete purchase of your comprehensive car insurance policy, you will be issued a certificate of insurance. This confirms your eligibility to report a claim in the event of any unforeseen circumstance on the vehicle.
Types of Auto Insurance In Nigeria
- Comprehensive Insurance: Comprehensive Insurance protects your car against unforeseen circumstances beyond collisions. It is often required alongside collision coverage if your are financing your vehicle. Examples Include: Theft, Vandalism, Fire or animal collision. Comprehensive Insurance is the most extensive coverage you can opt for.
- Third Party Fire and Theft Cover: Third Party, Fire and Theft (TPFT) covers damages done to a third party’s vehicle or property and their medical bills if you are at fault in an accident. TPFT is a more affordable option compared to comprehensive Insurance and it is the minimum legal requirement for car Insurance in Nigeria.
- Special Perils Insurance: Special perils Insurance protects your car against fire, riot, lightening, storms etc. It can be purchased as an add-on for specific risks not included in your standard plan.
- No Deposit Car Insurance: The No deposit car Insurance is a term that requires you to spread your car insurance payment on a monthly basis instead of requiring a large one time deposit.
4 Factors to Consider When Buying Car Insurance
1. Vehicle value and Insured declared value: This is a major factor influencing your premium. A more expensive car with a higher IDV will naturally cost more to insure comprehensively. IDV represents the maximum sum the insurance company will pay in case of total loss (theft or irreparable damage) of your vehicle. It’s typically based on the car’s current market value, considering depreciation. Â Choose an IDV that reflects your car’s value. A very low IDV might leave you financially responsible for a gap between the payout and repair/replacement cost.
2. Driver’s Profile: Insurance companies access your risk profile as a driver. Younger drivers with less experience tend to pay higher premiums. other factors that affect your premium includes drivers experience, age, occupation, and location.
3. Types of Coverage: There are different levels of coverage available in Nigeria which include Third party Only (TPO), Third party fire and theft, and comprehensive. Choose the level of coverage that best suits your needs and budget.
4. Compare Quotes: Get quote from multiple reputable insurance companies in Nigeria to compare coverage options and pricing before making a decision.
Pros and Cons of Auto Insurance
Pros
- Financial protection
- Legal requirement
- Peace of mind
- Medical coverage
- Additional service
Cons
- Cost
- Coverage limits
- Exclusions and limitations
- Complexity
- Claim process
Frequently Asked Questions
What Covers are Provided by Motor Insurance?
Motor insurance protects you and your vehicle against liability in case of an accident. It gives you financial compensation for injuries caused by accidents.
Is Engine Cover in Comprehensive Car Insurance?
Yes, a standard car insurance policy may cover engine damage. It will cover the costs used in repairing or replacing the engine system of your car.
Comprehensive Car Insurance Price in Nigeria?
In Nigeria, to buy a comprehensive insurance policy, most insurance companies charge between 3% – 7% of the total value of your vehicle yearly. The value placed on the car is the cost of buying the car.
Conclusion
Many might fall into the temptation of devaluing their vehicle in order to beat the cost of premium charged on the vehicle. People do this because they don’t know why they need car insurance.
Not only is this a wrong insurance practice, but you risk the chance of making any claim on the vehicle in the future invalid when the unexpected happens.
Also, given the cost of car insurance in Nigeria, endeavor to check regularly if your car insurance is active.
