What is car insurance
Car insurance provides the necessary financial cover to your car against various types of damages, theft, third party liability. We are aware of the fact that if we drive a car without insurance in India, we may have to pay a fine for it.
To get the benefit of this, you have to pay an annual installment.
Car insurance is beneficial and provides useful features that definitely help in times of need.
The value of your insurance policy depends on the IDV, the declared insurance amount of the car, which is the maximum amount of insurance to be paid to you by the insurance company. This is equal to the market price of your vehicle. So when you get insurance for a car, When purchasing, the IDV is calculated based on the listed price of the showroom.
How are car insurance policies in India
Car insurance in India is basically classified into two different forms.
1. Third-Party Insurance:
Third-party insurance is considered necessary under the Motor Vehicles Act. Third-party insurance covers loss to the third party or injured in the accident, injury of the property of the third person, etc. Under this cover you will not have to bear any kind of expenses, the insurance company will bear all the costs.
2. Comprehensive Coverage:
Comprehensive cover is the most effective form of car insurance. Under this, not only do you get third party cover, but the insured vehicle also receives a full sheet. It covers the insured car and third party liability as well as maximum expenses.
The benefits of car insurance are as follows:
Cover against loss or damage
Coverage against loss or damage caused by accidents, fire, theft, explosion, riots, terrorist activities, or natural disasters.
Personal accident cover
Cover against financial liability due to injury or death of a third party or damage to the vehicle.
Extra cover
Car insurance has become essential in India due to its benefits. You should also invest in a car insurance policy to protect your vehicle. With third party liability cover, you can protect yourself from paying hefty fines during accidents.
Zero Depreciation Cover
As your car gets old, its market value decreases. To cover this value, you can go for a zero depreciation cover. You can get zero depreciation cover only on a 3-year-old car. You will have to pay extra to avail this add on cover.
What does motor insurance cover
1 - Loss or damage due to natural disaster
Any damage from events outside your control, such as lightning strikes, floods, earthquakes, thunderstorms, storms, landslides, cyclones, etc.
2- Loss or damage due to man-made disaster
Such as theft, robbery, riot, strike, terrorist activity, and any damage during the road, rail, or water transport.
3-Personal Accident Cover
You can get an accident amount for any damage done by the driver while riding or leaving the car.
4-Legal liability of the third party
This policy protects you against legal liability against accidental injury resulting in permanent wounding or death of a third party. It also covers damage to nearby property.
What does motor insurance not cover?
1 - Driving under the influence of drugs or by drinking alcohol.
2- Intentional loss or damage.
3 - When an uninsured person drives.
4-war, in case of damage due to nuclear risk.
No claim bonus
When you do not make any claim during the policy term, you will be liable to avail the exemption at the time of renewal, and such exception is known as a no-claim bonus.
Roadside assistant
With a valid car insurance policy, you will get the option to avail of the cover as an add on. These benefits can be in the form of emergency transport, daily allowances, assistance in case of a bad battery, taxi benefits, towing facilities, and many more. These small things help you effectively when you are stuck in unwanted situations.
Invoice cover
It is an add on the cover that helps the policyholder in case of complete loss of your car in case of any damage due to accident. With the help of this add-on coverage, you will receive the amount that will compensate for the difference between the invoice value and its insured value.
Replacement cover
This feature of this add on assures you that if you lose your car key, this feature will cover its replacement expenses. It will also provide coverage for the purchase of new car locks. The insured person can avail of this facility once in the entire policy.
Can not get coverage under the necessary car insurance plan
Specific risks are not liable to obtain the coverage required under a basic car insurance policy. You can compensate for the loss with the add on feature in the cover.
The average breakdown of the car - the costs due to wear and tear are usually not included in a standard plan. However, you can get cover on it by selecting the Zero Dep cover.
Generally, a car engine is not liable to obtain cover for non-accidental malfunctions. You can cover the engine guard cover option.
Passengers with a car or a car driver are not covered under the Basic Car Insurance Policy. However, you can include all these in the policy along with the necessary accident cover.
The car insurance policy is valid only in India. Still, it can be extended to cover the neighboring country like Bangladesh, Sri Lanka, Bhutan, Pakistan, Nepal, and Maldip by paying an additional premium of Rs 500 per vehicle.
It is always advisable to look carefully at the policy documents and read and understand all the terms and conditions involved. This will help you at the time of filing the claim, as it provides protection from confusion and better clarity of the entire process.
How to choose the best car insurance plan?
Car insurance is basically a contract according to which the insurer is liable to pay against the financial loss caused by the damage to the car. In India, it is mandatory to have a motor insurance policy to drive legally. This will be to cover the costs you may face in case of a stolen or damaged car.
The amount of your motor policy-related premium depends on the insured declared value (IDV) of your car. The higher the IDV, the higher the premium amount, the lower the IDV leads to a smaller premium amount. It is important to compare features or plans before purchasing or renewing the current policy.
Things to consider before buying a car insurance plan
Brand: It is essential to pay attention to the reputation of the insurance company while purchasing the policy. You should check the company's records and claim ratios. An insurance company with a weak claims ratio will not be appropriate when purchasing a vehicle insurance policy.
Voluntary excess: According to experts, the voluntary excess should be less than the no-claim bonus amount, which you will be eligible for next year.
Safety features: You can get a great discount if your car has any security features like an alarm, immobilizer.
NCB (No Claim Bonus): It is advised that you do not claim for minor damages and repairs that you can pay out of your pocket and which do not put any extra burden on you. No Claim Boss will help you in a future high cost of expenditure.
Network Garage: Most online companies offer cashless services only if your vehicle can be repaired in a network garage. Therefore, look for insurers with maximum network garages on your list.
Car insurance renewal
Car insurance is an important document that you must carry whenever you want to drive; otherwise, you will have to pay hefty fines. You are required to renew the car insurance policy on time, and if you forget to complete it on time, you can get it replaced within the grace period. Car insurance renewals can be renewed easily using online services.
For renewal, you can take help from the insurance company or ask us, we will help you. The online renewal process is easy and hassles free. At the time of renewal, you can renew the existing policy or go for portability.
Right coverage: Those who have only third party plans should start thinking about a comprehensive policy. With such helpful and useful insurance plans, you can quickly get the desired cover.
Check IDV: Revalue the insured declared value of the car against the premium. You will get compensation in case of theft or loss.
Claim investigation: It makes a big difference. If you have not checked the claims ratio of your previous insurance company, then check it now.
Check cashless garages: See all the cashless garages around your area that offer your car repair services.
Add-ons: Check all available add-ons to get the most suitable add-ons for you.
Deductibles and discounts: Take advantage of all available rebates. The deductible is the amount you have to pay each time before the claim.
Simple formulas can help you understand the car insurance premium calculation better. Premium = Own Loss Premium - (No Claim Bonus + Discount) + Liability Premium as determined by IRDAI + Cost of Add-on.
Documents required to purchase car insurance
driving license
vehicle information
Bank statement
Duly filled claim form
tax receipt
All paperwork sent by the insurance provider (supplied by you)