Here are a few basics that you need to know about Panama car insurance. Getting Panama car insurance is similar to getting insurance in the United States but there are a few differences. Regulations in Panama require car owners to maintain a basic insurance plan for civil responsibility, which covers any damages to third party property, physical injuries and accidents.
Unlike basic car insurance plans in the US, basic Panama car insurance plans typically offer a few extra benefits, such as roadside and driver assistance in case of accidents. You could see it as a Panamanian version of AAA in the US. Thus, services such as battery boost, towing, fuel delivery, tire rotation, and lockout come in handy. We made use of this just this month!
Basic liability insurance costs go from $125 to $150 per year up to a maximum coverage of $10,000 coverage and is typically the only option available for vehicles greater than 10 years old. The higher the coverage, the higher the annual cost.
If you have a low coverage plan and you get into an unfortunate car crash with an Audi, Mercedes or BMW, the insurance will most likely not be enough to help cover the damages if the accident was your fault.
If you feel like you need more coverage or services than the ones offered by the basic Third Party plan (daños a la propiedad ajena), you can always opt for the Comprehensive insurance plan (cobertura completa).
The cost of this insurance depends on the make, model of the car and value. Take, for example, a car worth $20,000. Insurance for this car would cost anywhere from $700 to $800 per year to begin with, and cost more depending on your variable coverages that you may select.
What is included in full coverage Panama car insurance?
- Bodily injury liability (lesiones corporales): coverage for medical expenses when someone else is injured.
- Property damage liability (daños a la propiedad ajena): coverage for damages caused to someone else’s property, including other vehicles.
- Medical assistance (asistencia médica): refers to the medical expenses of anyone injured when travelling in your car.
- Collision (colisión): coverage for your car in the case of accident while you are driving the vehicle.
Comprehensive (exhaustivo): any damage to your vehicle caused by something other than collision is covered. For example: theft, vandalism, falling tree or rocks, lightning, flood, plus accidental glass breakage such as caused by stone thrown up by another vehicle.
Other benefits you get with Comprehensive insurance:
- Car rental in case of theft or collision
- Legal assistance in case of accident
- Medical emergency service (ambulance service and medical attention) in case of an automobile accident. This type of service is offered, for the most part, in Panama City.
- Extraterritorial coverage in Costa Rica (from seven to 30 days depending on the company)
Keep in mind: Comprehensive Panama car insurance is mandatory if you have a loan against your vehicle.
You also need to be mindful of deductibles coming out of your own pocket. Some insurance companies will reimburse a deductible (or a percentage of it) only if the insured were found not guilty of causing the accident, and after showing the ruling from the Panama Transit (Autoridad del Tránsito) courts.
All drivers must always keep in their car:
- Vehicle registration (registro único vehicular)
- Proof of car insurance (prueba de seguro vehicular)
- Traffic collision form (Formato Único y Definitivo para Accidentes de Tránsito Menor).
It is important to keep these documents in your vehicle since a police officer could ask for them at any given moment. There is a $100 fine in case you fail to provide proof of insurance!
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