Car Insurance Glossary

Planning to invest in insurance for your car? While doing your research, you may come across a number of unfamiliar, highly technical words unique to the industry. Don't panic! This glossary will walk you through the most essential need-to-know terms you’ll encounter when looking for an auto insurance plan in Thailand.

1st Class Insurance

A car insurance policy that covers the insured vehicle’s driver and passengers, theft, fire damage, damage from accidents and collisions, Compulsory Third Party Liability, Third Party property damage, and bail bonds. The most comprehensive policy available in Thailand.

2nd Class Insurance

A car insurance policy that covers the insured vehicle’s driver and passengers, theft, fire damage, Compulsory Third Party Liability, Third Party property damage, and bail bonds.

3rd Class Insurance

A car insurance policy that covers the insured vehicle’s driver and passengers, Compulsory Third Party Liability, Third Party property damage, and bail bonds.


An unexpected incident involving the insured vehicle, leading to unintended damage or third-party injury the Insurer is required to cover as per the Insured’s policy.

Application Form

A detailed form the car owner fills out and submits to the Insurer, expressing intent to acquire an insurance policy. The prospective Insured must fill out the application form as truthfully as possible, otherwise the Insurer can invoke its legal right to null the policy or render it ineffective.

Bail Bonds

A type of financial security that assists people at risk for jail time in the case of serious accidents. Often obtained in car insurance policies alongside Compulsory Third Party Liability.


The person who stands to benefit directly from the policy by receiving a claim amount, as per limits specified in the agreement. The Beneficiary is not always the same person as the Insured; the term may also apply to the Third Party involved in an accident.


A request by the Insured to the Insurer for an amount of money, which the Insured would use to compensate for vehicle damage, loss, or injury.

Claim Amount

The monetary amount of the Claim, the limits of which are specified in the insurance policy.The Claim Amount is determined depending on the extent of the damage the Insured needs monetary assistance for.

Compensation Fund

See Third Party Insurance Compensation Fund.

Comprehensive Cover

A type of car insurance with coverage that goes beyond basic third-party liability, extending to damage incurred by the Insured. See also 1st Class Insurance.

Compulsory Motor Insurance (CMI)

Insurance coverage required for all Thai car owners.This requires the car registration document, and includes Compulsory Third Party Liability and coverage for the insured vehicle’s driver and passengers.

Compulsory Third Party Liability (CTPL)

A type of third party liability required for all vehicles except motorcycles, modified farm trucks, and modified samlors. CTPL is required for all car owners as per the Motor Accident Victims Protection Act B.E. 2535 (A.D. 1992), and allows the Third Party to claim THB 50,000 for the initial medical costs of personal injury or death. The Third Party may claim an additional THB 80,000 in the case of disablement, maiming, or any other permanent damage caused directly by an accident with the insured vehicle.


The detailed list or breakdown of benefits the Insured may receive from the Insurer through the agreed policy.


A paper the Insurer issues to the Insured prior to the finalisation of a policy, guaranteeing the coverage of the Insured.


An amount of money the Insured pays out of their own pocket before the Insurer covers their claim. The amount of deductibles may vary according to the policy, and is often inversely proportional to the amount of the premium.


An amount of money the Insured pays out of their own pocket for additional coverage not specified in their original policy. Excess is a separate quantity from the original policy’s premium, and often involves applying for a second policy to cover losses exceeding the first policy’s sum insured.

The Insured

Also known as the Policyholder; the person directly taking out the policy from The Insurer. In the case of car insurance, the label can apply to either the car owner or the actual car named in the policy.

The Insurer

The company that provides the policy, granting insurance protection for a premium payable by the car owner.

No-Claims Bonus

A discount offered by the Insurer on the premium if the Insured has not filed a claim in a year. Only applies to some policies.


A legally binding contract of agreement between the Insurer and the Insured. A policy grants the Insured insurance protection as per mutually agreed-upon limits set by the Insurer.

Policy Term

The length of time in which a policy shall stay valid. The Insured must take note of the policy term and apply for claims before the term expires.


See The Insured


The payment The Insured pays to The Insurer in exchange for insurance, granted in the form of a Policy. Car owners have the option to pay their premium either monthly or yearly


A rough estimate of the premium a policyholder may pay, obtained before formally applying for a policy. Owners planning to get car insurance may inquire with insurance providers in their area to find quotes that work best with their budget.


The act of extending the duration of a policy once the policy term expires, thus extending the protection of the Insured for a longer period of time.


The probability or likelihood of a vehicle/ driver getting into an undesirable circumstance (such as an accident, loss, fire, and other situations), expressed in quantifiable terms. The Insurer uses risk to calculate the amount of coverage The Insured is entitled to receive.

Sum Insured

The maximum claim amount the Insured can receive from the Insurer.

Third Party

Any person not directly involved in the policy agreement between the Insured and the Insurer. This term frequently appears when the Insured is involved in an accident that has led to the injury, death, or property damage of other people.

Third Party Insurance Compensation Fund

An institution supported by both the government and the insurance industry. In the event of an accident involving a third party, the initial payment (mentioned under Compulsory Third Party Liability) shall come from either this institution or the Insurer.The Compensation Fund may also intervene in cases where affected persons have no third party liability.

Third Party Liability

A type of car insurance that’s meant to protect the Third Party, rather than the Insured, in an accident involving the insured vehicle. Depending on the policy, Third Party Liability covers the medical expenses and other financial costs incurred by the Third Party as a direct result of the incident with the Insured. See also Compulsory Third Party Liability.

Did you find what you were looking for? See Car Insurance Guide or FAQs page for more detailed information.