Liability car insurance is one of the important coverage to have for private vehicles. Besides the legal requirement, liability coverage is of paramount importance for several reasons, such as covering passengers in the car and financial protection in the event of an accident. Here are some key reasons highlighting the importance of liability insurance that you should know.
Fulfils legal requirement
- Having liability insurance is a legal requirement in many places. Liability coverage, such as legal liability (LLP) to passengers and legal liability of passengers (LLOP) are mandatory requirements to drive in Singapore.
- Foreign vehicles must have this coverage to enter the island nation by land, and driving without it may lead to fines and legal consequences. Having this coverage proves that you can cover the costs of damages or injuries for which you may be liable.
Offers financial protection
- Liability coverage like many other vehicle insurance add-ons provides financial protection. In most cases, it covers the costs associated with injuries to other people or damage to their property in an accident where you are at fault. This can include medical expenses, repair costs, and legal fees.
- This financial protection subsequently offers peace of mind while driving. Knowing that you have coverage in case of an accident can alleviate stress and allow you to focus on the road.
Protects your assets
- Because liability coverage offers financial protection, it also protects the assets of vehicle owners who are involved in accidents. If you cause an accident and don’t have liability coverage, you may be personally responsible for the expenses incurred by the other party.
- This could jeopardize your assets, such as savings, property, or other valuables in order to compensate for losses. However, having liability protection means your assets are safe from trouble as your insurer will make up for the loss.
Covers your passengers
- Liability insurance can also extend coverage to passengers in your vehicle, protecting them in case of injury or damages resulting from an accident for which you are liable. The two most common types of liability coverage offered to private vehicles are legal liability (LLP) to passengers and legal liability of passengers (LLOP).
- These add-on benefits offer legal assistance if you are sued by the other party involved in an accident where your insurance company provide legal representation, helping you navigate the legal process.
As you can see, liability car insurance is not only a legal necessity but also a fundamental financial safety net that protects both you and others on the road in case of an accident. Although it’s not mandatory to have liability coverage in Malaysia, it’s an essential component of responsible and legal vehicle ownership.
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