What Are Car Insurance Exclusions in Thailand and Why Do They Matter?

Car insurance is designed to safeguard you against unexpected events. However, it’s important to understand that not every situation will be covered. Insurance policies come with specific exclusions, meaning there are certain circumstances where you won’t be able to file a claim. Knowing these exclusions helps you better understand your coverage and avoid surprises when you need to rely on your insurance.

Car insurance exclusions in Thailand | MrKumka

What are insurance exclusions?

Insurance exclusions are specific conditions or circumstances not covered by an insurance policy. These exclusions are outlined in the policy documents and are crucial for policyholders to understand, as they define the limits of coverage. Exclusions help manage the insurer’s risk and ensure that policyholders are aware of their responsibilities and potential out-of-pocket expenses.

Why are insurance exclusions important?

Protecting the insurer from high-risk insurance claims

Insurance companies use exclusions to ensure they can provide coverage sustainably and manage risks effectively. By excluding certain high-risk scenarios, insurers can keep premiums more affordable for all policyholders. For example, excluding coverage for damages caused by illegal activities or reckless behaviour helps insurers avoid paying out large sums for preventable incidents.

Encouraging responsible driving

Exclusions also serve to encourage responsible behaviour among policyholders. For instance, excluding coverage for damages incurred while driving under the influence of alcohol or drugs promotes safer driving habits. Similarly, exclusions for mechanical or electrical breakdowns not caused by an accident mean insurance only covers accident damages, regardless of how well the vehicle is maintained. This encourages policyholders to understand the importance of being a responsible driver.

Preventing fraudulent claims

Exclusions help prevent fraudulent claims by clearly defining what is not covered under the policy. This discourages policyholders from attempting to claim for damages or losses that fall outside the scope of their coverage. For example, if a policy explicitly excludes coverage for intentional damage, it reduces the likelihood of someone deliberately causing damage to their vehicle to receive an insurance payout.

Types of car insurance exclusions in Thailand

General exclusions

These are common exclusions found in most car insurance policies in Thailand:

  • Wear and tear: Damage resulting from regular use and ageing of the vehicle is not covered. This includes things like worn-out tyres, brake pads, and other parts that naturally degrade over time.
  • Mechanical or electrical breakdowns: Failures due to mechanical or electrical issues that are not caused by an accident are typically excluded, as these are considered maintenance issues. For example, if your car’s engine fails due to a lack of maintenance, it won’t be covered.
  • Driving under the influence: Any damage or loss occurring while the driver is under the influence of alcohol or drugs is excluded. The specifications are as follows:
    • Blood alcohol level exceeding 50 milligrams per cent.
    • Blood alcohol level exceeding 20 milligrams per cent for drivers under twenty years old, those with a temporary license, or those without a license, or during license suspension or revocation.
    • Refusing to let traffic officers, investigators, or officials test for alcohol levels, resulting in prosecution for driving under the influence, with the driver either accepting the charge or the court issuing a final judgment.

Specific exclusions

These exclusions can vary between policies and insurers in Thailand:

  • War and civil unrest: Insurance policies in Thailand typically do not cover damage or liability arising from war, civil unrest, or similar events. This includes situations like riots or political disturbances.
  • Nuclear hazards: Damage caused by nuclear weapons, radioactive contamination, or ionising radiation is excluded. This is a common exclusion due to the catastrophic nature of such events.
  • Territorial limitations: Coverage may be limited to incidents occurring within Thailand, excluding international travel. If you drive your car outside of Thailand, you may need additional coverage.
  • Theft or embezzlement: The insurance won’t cover loss or fire damage if it’s caused by someone who has legal access to the car, like a spouse, partner, business partner, or anyone with a lease, loan, or similar agreement to use the vehicle.
  • Illegal use of vehicle: Any damage or liability resulting from the illegal use of the vehicle, such as using it for criminal activities, is excluded. This ensures that the insurance policy is not used to cover illegal actions.
  • Racing: Damage incurred while participating in racing events is not covered. This includes both organised races and informal street racing.
  • Towing and pushing: Damage caused while towing or pushing the vehicle is often excluded, unless the towing is done by the insurance company.
  • Contractual liability: Any liability assumed under a contract that is not specifically covered by the policy is excluded. For example, if you sign a contract that makes you liable for certain damages, your insurance may not cover those liabilities.
  • Traffic law violations: Insurance may not cover accidents caused by serious traffic violations such as driving on sidewalks, improper use of emergency lanes, running red lights, excessive speeding, or driving against traffic due to the high risk and reckless behaviour involved.

How to read your policy: Tips on finding & interpreting exclusions

Understanding your car insurance policy is crucial to knowing what is and isn’t covered. Here are some tips on where to find exclusions in your policy documents and how to interpret them:

  1. Locate the exclusions section

    Most insurance policies have a dedicated section titled “Exclusions” or “What is Not Covered.” This section is usually found towards the middle or end of the policy document. It lists all the scenarios and conditions under which the insurer will not pay out a claim.

  2. Read the definitions

    Before diving into the exclusions, familiarise yourself with the “Definitions” section of your policy. This section explains the specific meanings of terms used throughout the document. Understanding these definitions will help you accurately interpret the exclusions.

  3. Pay attention to conditions and clauses

    Exclusions often come with specific conditions or clauses. For example, an exclusion for driving under the influence might specify the legal blood alcohol limit. Make sure to read these conditions carefully to understand the full scope of the exclusion.

  4. Check the endorsements and riders

    Endorsements and riders are additional documents that modify the standard policy. They can add, remove, or alter exclusions. Always review these documents alongside your main policy to get a complete picture of your coverage.

  5. Interpret the language carefully

    Insurance policies often use legal and technical language. Here are some tips to help you interpret it:

    • Look for key phrases like “excluding,” “not covered,” and “subject to” as they indicate exclusions.
    • Determine whether the exclusion applies to specific situations or is more broadly applicable.

Insurance needs can change over time, so it’s important to review your policy and its exclusions regularly. This ensures that you remain aware of what is and isn’t covered, especially if you’ve made changes to your vehicle or driving habits. If any part of the exclusion is unclear, don’t hesitate to contact MrKumka for assistance or directly to your insurance provider for clarification.

Definition
Fraudulent claims When someone intentionally provides false information to an insurance company to receive money or benefits, they are not entitled to.
High-risk A situation or activity that has a high chance of causing problems, loss, or danger.
Insurance payout The amount of money an insurance company gives to a policyholder or beneficiary when a claim is approved.
Liability The legal responsibility for something, especially if it causes harm or damage, which may require you to pay for it.