Assurance for third parties or all-risk insurance: how to make the right choice?

In summary

Section 🔖	Summary Content
🚗 Obligation of insurance	All vehicle owners must take out liability insurance to cover damages caused to others.
📜 Why is third-party insurance mandatory?	It is a legal requirement in France to compensate victims of road accidents, even if the perpetrator cannot pay.
🛠️ Completing third-party insurance	Owners can add damage coverage guarantees to protect their own vehicle against risks such as theft, glass breakage, etc.
🌟 Comprehensive insurance	The most complete and most expensive plan, covering all damages whether the insured is responsible or not. Includes protections like theft, natural disasters, etc.
🆚 Comparison of insurances	Third-party insurance is cheaper but offers limited coverage, while comprehensive insurance provides full coverage but costs more.
💡 When to choose third-party insurance?	Suitable for low-value vehicles or tight budgets. Not recommended if the vehicle is of high value.
📊 Difference between all-accident damages and comprehensive insurance	The all-accident damage guarantee is part of comprehensive insurance but focuses only on damages to the insured vehicle.
🛡️ Personal injury coverage	Option not always included, covering medical expenses and income loss for the driver in case of a responsible accident.
🔍 In summary	Comprehensive insurance is ideal for those seeking maximum protection and willing to pay a higher cost for this security.

Choosing the right auto insurance is crucial for any vehicle owner. Whether you opt for third-party insurance, which is mandatory and economical, or for comprehensive coverage, which is more costly but offers full protection, understanding the details of each option will help you make an informed decision. In this article, we explore the nuances of these two main types of insurance to guide your choice.

Obligation of insurance

Any person owning a vehicle is under the legal obligation to insure it with liability coverage, that is, third-party insurance. Reminder: Liability insurance covers damages that an insured may cause to a third party. This plan can be supplemented with damage guarantees.

Why is third-party insurance mandatory?

In France, the law requires every vehicle owner to carry at least liability insurance. This obligation is set out in Article L211-1 of the Insurance Code. Liability, often called third-party insurance, is the minimum auto insurance policy. It covers material and bodily damages that the insured might cause to third parties during an accident.

For example, if you cause an accident that damages another driver’s vehicle or injures a pedestrian, it is your liability insurance that will cover repair costs for the damaged vehicle or medical expenses for the injured person.

The main goal of this obligation is to ensure that all accident victims can be compensated for their damages, even if the responsible party lacks the financial means to pay. Thus, this insurance protects third parties and ensures some financial justice on the road.

Completing third-party insurance with damage guarantees

Although third-party insurance is mandatory, it does not cover damages suffered by your own vehicle or by you as a driver. To address this limitation, it is possible to supplement this basic plan with damage guarantees. These additional guarantees expand your coverage and provide better protection.

Examples of damage guarantees

1. Glass breakage guarantee: Covers replacement or repair of your vehicle’s windows in case of breakage (windshield, side windows, rear window).
2. Theft and fire guarantee: Protects your vehicle against theft and damage caused by fire.
3. Natural and technological disaster guarantee: Compensates for damages caused by natural events (floods, storms) or technological events (explosions, industrial accidents).
4. Collision damage guarantee: Covers damages to your vehicle in case of collision with another vehicle, an animal, or a fixed object.
5. Legal defense and recourse guarantee: Covers your defense costs in case of a dispute following an accident and assists in obtaining compensation.

Comprehensive insurance: the most complete plan

The most complete plan is comprehensive insurance, but it is also the most expensive. Comprehensive insurance includes not only the guarantees of the third-party plan but also an extended protection for your own vehicle and yourself, regardless of the circumstances of the accident, whether you are responsible or not.

Advantages of comprehensive insurance

1. Extended coverage: Covers all types of damages, including those caused by natural disasters, theft, vandalism, and responsible accidents.
2. Full compensation: Ensures quick and complete reimbursement for vehicle repairs.
3. Peace of mind: Offers maximum protection, reducing stress and concerns related to road incidents.

Disadvantages of comprehensive insurance

1. High cost: Due to its extensive coverage, comprehensive insurance is generally more expensive than third-party insurance.
2. Deductible: Some policies may include high deductibles, meaning you pay part of repair costs before insurance covers the rest.

Comparison between third-party and comprehensive insurance

Criterion	Third-party insurance	Comprehensive insurance
Cost	Less expensive	More expensive
Coverage	Damages caused to third parties	Damages to third parties and your vehicle
Advantages	Minimal legal protection	Maximum protection, full coverage
Disadvantages	Does not cover your own damages	Higher cost, possible deductible

Third-party insurance

Third-party insurance is a popular option due to its low price, making it particularly suitable for low-value cars. It guarantees the financial coverage of damages caused by the insured or their vehicle to others. These damages can be material, such as a collision with another vehicle. They can also be bodily, such as injuries to persons involved in the accident. This includes your own passengers, such as:

• your family,
• other vehicle occupants,
• a cyclist,
• a pedestrian.

The civil liability of some policies complements this coverage level with optional or non-mandatory services, such as assistance services for towing or repatriation in case of an accident or breakdown, loan of a replacement vehicle, or legal defense and recourse guarantees following an accident that protect the insured in case of a dispute.

Advantages of third-party insurance

1. Lower cost: Third-party insurance is generally less expensive than other types of insurance, making it an attractive option for budget-conscious drivers.
2. Compliance with legal obligations: It ensures you meet the minimum coverage requirements imposed by law, allowing you to drive legally.

Disadvantages of third-party insurance

1. Limited coverage: This plan does not cover damages to your own vehicle, meaning you will need to pay repair costs in case of a responsible accident.
2. Financial risk: In case of a responsible accident, costs can quickly accumulate because only damages caused to others will be covered.

Possible additional guarantees

Although third-party insurance is the basic plan, additional guarantees can be added to extend coverage. Here are some examples:

• Assistance service: In case of an accident or breakdown, this guarantee offers services like towing or repatriation.
• Vehicle loan: If your car is immobilized after an accident, this option allows you to obtain a replacement vehicle.
• Legal defense and recourse guarantee: In case of a dispute following an accident, this guarantee covers legal defense costs and helps you obtain compensation.

When to choose third-party insurance?

Third-party insurance is especially suitable for low-value or old vehicles. It also fits drivers with a limited budget or those using their car occasionally. If your vehicle is new or of high value, it might be wiser to consider comprehensive insurance for optimal protection.

All-risk insurance

For more comprehensive coverage, it’s better to opt for all-risk insurance. It includes the guarantees of the third-party plan but also offers the damage guarantees that cover the vehicle against theft, fire, natural disasters, glass breakage, and all-accident damages. The all-accident damage guarantee compensates the insured whether they are responsible or not for the incident. Repair costs for the vehicle will be covered, unlike third-party insurance, which only indemnifies damages caused to others.

Difference between all-accident damage and comprehensive insurance

Be careful not to confuse comprehensive insurance with the all-accident damage guarantee. The comprehensive plan is the name of a contract, and all-accident damage is a guarantee included within the all-accident damage contract.

Guaranties included in comprehensive insurance

1. Theft and fire guarantee: Protects against vehicle theft and damages caused by fire.
2. Natural disasters guarantee: Covers damages caused by natural events such as floods, storms, and earthquakes.
3. Glass breakage guarantee: Handles repairs or replacements of broken or cracked windows.
4. All-accident damages guarantee: Compensates damages to the vehicle whether the insured is responsible or not.
5. Assistance guarantee: Provides roadside assistance services in case of breakdown or accident, often including towing and loan of a vehicle.
6. Legal protection guarantee: Covers legal defense fees and helps obtain compensation in case of disputes with a third party.

Personal injury guarantee

This guarantee is not automatically included in all contracts. It compensates for bodily damages when the driver is responsible for the accident. The driver’s bodily injury coverage includes serious injuries. In case of an accident, this guarantee ensures that medical expenses, hospital costs, and income losses are covered, providing additional financial security for the driver.

Advantages of comprehensive insurance

1. Extended coverage: Protects against a wide range of risks, ensuring maximum peace of mind.
2. Quick compensation: Enables rapid access to funds for vehicle repairs or replacements.
3. Full protection: Ensures the driver is covered in all circumstances, reducing financial risks.

Disadvantages of comprehensive insurance

1. High cost: This plan is more expensive than third-party insurance due to its extensive coverage.
2. Deductible: Some contracts impose a deductible, meaning the insured must pay part of repair costs before coverage kicks in.

In summary

Comprehensive insurance is suitable mainly for those who do not want to risk paying high repair costs and prioritize a form of security.

• Third-party insurance: Includes the mandatory guarantee of liability coverage. Its low price offers less coverage than comprehensive insurance. Its affordability is especially suitable for low-value cars.
• Comprehensive insurance: Offers full coverage, including damage guarantees and driver’s bodily injury coverage.

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