DIFFERENCES BETWEEN COMPREHENSIVE CAR INSURANCE AND MANDATORY FINANCIAL LIABILITY INSURANCE
DIFFERENCES BETWEEN COMPREHENSIVE CAR INSURANCE (CASCO) AND MANDATORY
LIABILITY INSURANCE The most important difference between comprehensive car insurance (casco) and mandatory liability insurance is that mandatory liability insurance is legally required, while comprehensive car insurance is optional. Vehicle owners often confuse these two types of insurance. To differentiate between them, it's necessary to first explain what each is and what it does.
Mandatory liability insurance, also commonly known as traffic insurance, is mandatory for all vehicle owners under the Highway Traffic Law. Its scope and the content of the contracts are determined by the General Terms and Conditions of the Highway Motor Vehicles Mandatory Liability (Traffic) Insurance. It covers the death expenses, medical expenses, and material damages of third parties in traffic accidents; in other words, it covers the damages of the other party involved in the accident, not the damages of the insured vehicle owner. If the vehicle owner causes damage to someone as a result of a traffic accident, it covers that person's damages.
Comprehensive car insurance (Kasko) is not legally mandatory, but it covers damages to the vehicle. Choosing it is entirely at the individual's discretion, and unlike compulsory traffic insurance (MTF), its content and coverage can be determined by the individual. Insurance companies generally offer different Kasko packages, and the coverage varies depending on the price; vehicle owners can choose whichever they prefer. Kasko coverage can include damages to the vehicle resulting from a traffic accident, as well as damages caused by theft, natural disasters, or fires – situations beyond the insured's control.
DIFFERENCES:
Traffic insurance is mandatory; vehicle owners cannot drive without it, and it must be renewed annually. Cancellation is only possible in exceptional circumstances such as the sale of the vehicle, the death of the owner, or the vehicle becoming unusable. Kasko, on the other hand, is not mandatory; not having it does not result in being unable to drive. It can be purchased optionally and canceled at any time.
They also differ significantly in terms of which party the insurance company covers the damages for. Traffic insurance covers damages to third parties; it is responsible for the damages of the other party, not the insured. Comprehensive insurance (Kasko), on the other hand, covers damages to the insured vehicle owner's own vehicle.
Traffic insurance requires an accident to have occurred, and it only covers damages resulting from a traffic accident, and this accident must have involved a third party because traffic insurance covers the damages of the other party. Comprehensive insurance, however, depending on the contract with the insurance company, may cover damages to the vehicle even if an accident does not occur, and it is not necessary for the accident to involve a third party; for example, damage from hitting a wall may be covered by comprehensive insurance.
The content and scope of contracts for traffic insurance cannot be freely determined by the parties; this scope is determined by law and regulations, and these must be complied with. In comprehensive insurance, there is no such determination; insurance companies offer different comprehensive insurance packages and offers, and vehicle owners can choose the one that suits them best.
Traffic insurance only covers damages resulting from death, medical expenses, and property damage; situations such as accidents caused by force majeure or theft are not covered by traffic insurance. Comprehensive (Kasko) insurance, on the other hand, can cover damages caused by both natural disasters and theft, depending on the contract.
Traffic insurance has an upper limit for the amount the insurance company will pay; if the amount of damage exceeds this limit, the remaining portion may be covered by the insured. There is no such legal upper limit for comprehensive insurance. The amount to be paid under comprehensive insurance is determined by the contract between the insured and the insurance company. Payment is made according to the amount and damages stipulated in the policy. For example, protection against natural disasters may or may not be included in a comprehensive insurance contract. If included, the amount of damage may be covered by comprehensive insurance regardless of its value.
Having traffic insurance or comprehensive insurance does not preclude having the other. In fact, even if a vehicle has comprehensive insurance, traffic insurance is still required because it is legally mandatory. Even if you only have compulsory traffic insurance, it may still require comprehensive insurance because it doesn't cover potential damage to your own vehicle. In summary, these two types of insurance are quite different and cover different types of damage.
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