CASCO or MTPL: Which to choose for your car in Cyprus?

Cyprus is a country where you feel you can't get around without a car, especially if you live outside the main cities or travel around the island a lot.

However, driving a car here comes with several mandatory rules, one of which is having an insurance policy. When it comes to choosing a policy, many drivers have the question of which is better - CASCO or MTPL? Let's understand what each is and how to make the best choice.

Compulsory insurance (CMTPL)

In Cyprus, Compulsory Motor Third Party Liability (CMTPL), also known as Third Party Insurance, is a minimum requirement for all car owners. This type of insurance:

1. Covers damage to third parties in the event of an accident, including damage to their car, property or personal injury.
2. Does not cover your car even if you are not at fault in the accident.

For example, if you accidentally hit another driver's car, MTPL will pay for repairs to their car, but not yours.

Key features of CMTPL insurance:

1. Compulsory: Without this policy, you won't be able to register your car or get an annual MOT.
2. Price: The cost depends on the type of car, the driver's age and length of service. MTPL is usually the cheaper option compared to CASCO.
3. Risks: If you don't have additional insurance, you'll have to pay for repairs to your car yourself, which can be expensive.

Optional insurance (Comprehensive insurance)

Comprehensive insurance is a broader and more flexible type of insurance that protects both your car and the property or health of third parties.

What does comprehensive insurance cover?

1. Damage to your car, regardless of who caused the accident.
2. Theft or theft of your car.
3. Damage caused by natural events such as floods, hurricanes or hail.
4. Vandalism and animal collisions.

Key features of the comprehensive cover:

1. Full protection: Even if you're at fault in an accident, your insurance will cover the cost of repairs.
2. Flexibility to tailor your policy: You can choose additional options such as natural catastrophe cover or international cover.
3. Cost: Usually much more expensive than MTPL as it covers more risks.

Example: If your car is damaged by a fallen tree, a CASCO policy will pay for the repairs. MTPL will not help in this situation.

It is advantageous for owners to have CASCO:

1. New cars from the showroom. In case of theft, accident or damage to the car, the insurance company will pay compensation to the owner.
2. Cars bought on credit. Banks require comprehensive insurance to insure the car against theft.
3. Expensive luxury cars where repairs and spare parts are expensive.

Car insurance is not worthwhile for cars older than 10 years. Companies refuse to insure because the high depreciation of the vehicle increases the insurance risks, plus the price of the policy may be higher than the market value of the car.

How to choose between CASCO and MTPL?

Your choice will depend on several factors including the age of the car, budget, driving experience and operating conditions. Let's take a closer look at these aspects.

1. 1. Age and value of the car
2. For new and expensive cars it is better to choose CASCO. The cost of repairing such cars can be significant and the insurance will protect you from major financial loss.
3. For older cars, MTPL insurance is usually sufficient. Repairing or replacing an old car may cost less than the annual premium of a CASCO policy.
4. 2. budget
5. Limited budget: MTPL is a more affordable option.
6. Willingness to invest in security: If finances allow, opt for comprehensive insurance to avoid unexpected costs in the future.
7. 3. Driving experience
8. If you're a beginner, comprehensive cover is a good defence, especially in the first few years when the risk of accidents is higher.
9. For experienced drivers with a clean driving record, MTPL insurance may be sufficient.
10. 4. Operating conditions
11. If you park your car outdoors or frequently drive long distances, the risk of damage is higher - comprehensive insurance may be useful.
12. If you use your car infrequently and keep it in a garage, MTPL insurance is likely to cover your needs.

How do I get insurance in Cyprus?

Steps to buying a policy:

1. Compare quotes from insurers. Use online calculators or contact agents to find out the cost of a policy.
2. Clarify terms and conditions. Check what is covered and any exclusions. For example, some policies don't cover damage caused by natural disasters or have restrictions for young drivers.
3. Choose the right policy. Make sure the policy meets your needs and budget.
4. Complete the paperwork. You'll need to provide your car registration details, driving licence and previous insurance history (if available) to complete the policy.

What type of coverage should I choose?

If your budget is limited and your car is not new, MTPL insurance provides minimal but essential protection. If you want maximum protection against financial risks, especially if you have an expensive or new car, choose CASCO. Whatever you choose, make sure you read the terms and conditions of the policy carefully and understand the insurer's nuances. The right choice of policy will give you peace of mind and financial protection in any situation on the road.

Don't forget that Cyprus has strict controls on the availability of MTPL insurance. Whatever you choose, make sure that your policy is active and that the terms and conditions are suitable for your needs.

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