Third Party vs Comprehensive Insurance

This article aims to explain on the differences among the two types of insurance protection available in Malaysia which is third party insurance and comprehensive insurance.

If you own a car in Malaysia, you would have bought motor insurance. Under the Malaysian law, all vehicles need to protected with motor insurance. There are many types of insurance protection and they offer different levels of protection. The type of insurance you buy is up to your needs.

Third Party insurance protects you against any injuries or deaths caused to another person (third party), as well as loss or damages that occurs to the third party car caused by your car. This type of insurance provides the minimum level of protection to you in the event of an accident. With third-party insurance, you cannot claim for any damages to your own vehicle. Third Party Insurance is the minimum level of protection any driver needs in order to drive in Malaysia.

Third-party insurance covers only a limited area. Here is the list of damages that third-party insurance covers.

• Third-party bodily injury to a passenger or a person in another car
  • In case you get into an accident and a passenger in your car is injured, third party insurance will cover their medical cost.
  • In case you get into an accident and a person in another car gets injured because of you, third party insurance will cover their medical cost.
• Damage to third party car
  • In case you get into an accident and damaged another person’s car, third party insurance will cover the cost to repair damages of the other person’s car.

The best type of insurance protection in Malaysia is comprehensive insurance. It provides the same coverage as third-party insurance with an additional coverage for your own car. In other words, this type of insurance protects both the third party (other people) and the first party (you).

Comprehensive insurance covers a variety of damages. Here are the full list of damages that comprehensive insurance covers:

• Physical contact with animals
  • In case your car hits a dog or a car, comprehensive insurance will cover the cost of repairing the damages.
• Natural disasters, including earthquakes, floods, and hurricanes
  • In case your car damaged due to earthquakes, floods, or hurricanes, comprehensive insurance will cover the cost of repairing the damages.
• Fire
  • In case your car catches on fire, comprehensive insurance will cover the cost of repairing the damages.
• Riots and vandalism
  • In case someone damages your car in riots or vandalism, comprehensive insurance will cover the cost of repairing the damages.
• Vehicle theft, or theft of parts of car
  • In case someone steals your car, comprehensive insurance will compensate you based on your sum insured.
  • In case someone steals your car parts (e.g. headlamps, tyre), comprehensive insurance will cover the cost of repairing the damages.
• Broken windshield
  • In case you have a broken windshield on your car, comprehensive insurance will cover the cost of repairing the damages.
• Fallen objects, including branches or rocks
  • In case your car is damaged from falling objects (including branches or rocks), comprehensive insurance will cover the cost of repairing the damages.

To better understand the differences, take a look at the summarized information below which explains what Third-Party and Comprehensive insurance covers.

• Third-Party Insurance

  • What it covers?

    • Third-party bodily injury to a passenger or a person in another car
    • Damage to another person’s car
    • Damage to another person’s property

• Comprehensive Insurance

  • What it covers?

    • All that Third-Party Insurance covers, plus incidents when:
      • Your car has been stolen
      • Your car is damaged by attempted theft (for example, broken door locks, windows or stolen audio and accessories)
      • Your car is damaged due to fire
      • Damage to your car due to accident

This depends on your needs. Below shows which type of motor insurance you should buy.

Get Third-Party insurance if :

• You are someone who cannot afford much on insurance
• Having a minimal level of protection is sufficient for you

Get Comprehensive insurance if :

• You can afford to pay extra for comprehensive insurance
• You want the maximum level of protection for yourself and your car

Lastly, regardless of what insurance type you choose, we also suggest that you buy extra protection on flood coverage since flood has hit Malaysia twice in 2022 itself. You can learn more about this add-on here.