What motor insurance protects
Motor insurance addresses two different needs. The first is protecting the driver's liability to other people: if a third party's car or property is damaged through the fault of the owner or driver, or if someone's health or life is harmed, the insurance company pays the damage within the limits of the policy. The second is protecting the car itself against damage, destruction and theft. In Kazakhstan the first need is met by compulsory motor third-party liability insurance (MTPL), and the second by voluntary comprehensive motor insurance (CASCO).
MTPL is required by law: you may not drive a car without a valid policy. CASCO is taken out at the owner's discretion, but it is often required by a bank or leasing company if the car was bought on credit or under a lease.
MTPL and CASCO: what is the difference
- MTPL covers only harm caused to third parties. The at-fault party's own car is not repaired under this policy. The terms and the payment procedure are set by law, so they are largely the same across different insurers.
- CASCO covers damage to your own car regardless of who is at fault, as well as theft if that risk is included. The terms are defined by the insurer's rules and the contract, so programs differ noticeably.
- Additional options include a voluntary increase of the liability limit above the compulsory policy, personal accident cover for the driver and passengers, towing and roadside assistance.
Main risks under CASCO
Full CASCO usually combines the "damage" and "theft" risks. Damage generally means:
- a road traffic accident, including one where the at-fault party is not identified;
- fire and explosion;
- natural events such as hail, flood, strong wind and falling trees;
- unlawful acts of third parties: body damage, vandalism, theft of parts;
- objects falling onto the car.
Partial CASCO covers only selected risks, for example total loss and theft. This option is cheaper, but minor damage will have to be repaired at your own expense.
What is usually not covered
- driving under the influence, without a driving licence, or by a person not authorised to drive under the contract;
- intentional acts of the policyholder or driver;
- normal wear and tear, corrosion and breakdowns unrelated to an insured event;
- use of the car for purposes not declared at inception, for example as a taxi or for driving instruction;
- leaving the scene of an accident and failure to follow the claim notification procedure;
- theft where the keys or registration documents were left in the car, under the terms of many programs.
The exact list of exclusions depends on the rules of the particular insurer, so it is worth reading before you sign the contract.
What determines the price
The cost of MTPL is calculated using a method set by law: it takes into account the type of vehicle, the region of registration, the age and driving experience of the drivers, and the accident history. For CASCO the insurer assesses more factors: the make, model, age and value of the car, the circle of drivers, the presence of anti-theft systems, the place where the car is kept, the set of risks, the size of the deductible, the method of settlement and the claims history. By changing the deductible, the list of drivers or the repair arrangements, you can find a balance between price and the scope of protection.
How to choose a program and what to check in the contract
- Sum insured — whether it matches the market value of the car and whether it reduces after a payment (an aggregate or non-aggregate sum insured).
- Deductible — conditional or unconditional, its amount, and whether it applies to every claim.
- Repair arrangements — a dealer's workshop, a workshop on the insurer's referral or a cash payment based on a cost estimate; whether depreciation of parts is taken into account.
- Drivers — a named list or any persons driving the car lawfully.
- Territory — Kazakhstan only or also trips abroad; to travel abroad you need a liability policy recognised by the country of entry.
- Notification deadlines — when an event must be reported and which documents will be required.
What to do if an insured event occurs
- Stop, switch on the hazard lights and make the scene safe; if anyone is injured, call an ambulance and the police.
- Record the circumstances: photos and videos, the details of the other parties, witnesses and their policies.
- Have the incident documented in the manner required by law and the insurer's rules.
- Notify the insurer within the period stated in the contract and do not start repairs before the car has been inspected.
- Hand over the documents and keep copies and correspondence.
How Polis Re can help
Polis Re, as an insurance broker, compares the terms of several insurers, explains the differences in exclusions, deductibles and repair arrangements, and helps select a program for your car and the way you use it. You can get a preliminary estimate of the cost in the CASCO calculator and the MTPL calculator, and for company cars the fleet insurance section is the right place. To receive offers and support in the event of a claim, send a request to the broker.
