Many car owners buy car insurance as a formality without giving it a thought. Often, low premium costs are the sole deciding factor while picking a car insurance product. This could easily mean not having adequate protection cover during an accident or damage.
It would be wise to go online to compare various insurance products available by several parameters including costs. Not just that, you should also be aware of all the facets of car insurance before finalizing a product.
Buying car insurance should be given just as much importance as buying the car itself. With a little understanding of car insurance, you can optimize your insurance purchase and enjoy greater benefits.
10 Things you should know before buying a Car Insurance in India
1. Third party insurance is mandatory
It is compulsory as per the Indian Road Safety Act and Indian Motor Vehicles Act. So, if you are buying a vehicle for the first time, make sure to get third party insurance before driving it on the roads. Third party insurance will offer you a protective cover against damages caused to any third person, vehicle, or property and will cover claims for damage caused to a third party including claims for grievous injury, disability, or death. You cannot however seek any claim for damage caused to your own self or your vehicle under a third-party insurance cover.
2. Seek comprehensive cover for better protection
You can seek a comprehensive insurance cover that will offer protection for damages caused to your car and self in an accident. Furthermore, a comprehensive insurance will protect your car against any accidental fires, thefts, and other damages as per the selected insurance plan. Do not overlook comprehensive cover for saving on insurance premium costs as third-party insurance does not offer any cover for your vehicle or self.
3. Seek additional covers based on your risk profile like Road Assistance
Buying add-ons for car insurance can mean you get optimum protection. Seek add-on covers as per your risk profile. For example, if you usually drive late nights and long distances, opting for a quick road assistance insurance add-on can be most suitable should you need assistance in any odd hours on a deserted stretch.
4. Do not overlook personal accident cover
Opting for a personal accident cover is now mandatory and can ensure you get adequate protection against any physical loss or disability during a car accident. You can also avail this cover for any and all passengers in your vehicle based on its seating capacity.
5. Think twice about dealer insurance
Your car dealer may offer you insurance at the time of making your car purchase. It may not necessarily be your best option, nor would it necessarily be the cheapest option. As a thumb rule, do not buy an insurance product before comparing quotes and features from multiple insurers. The Only option beneficial in the case of Dealership is Cashless facility.
6. Know the Insured Declared Value of your car
Your car insurance premium is linked to the Insured Declared Value (IDV) of your car. IDV is the maximum amount that you can claim under a motor insurance policy. For example, a new car will have a higher IDV compared to a car of the same model and make which is one year old. The IDV of vehicles aged over 5 years is calculated by Mutual agreement between insurer and the insured and upto the age 5 years fixed depreciation criteria is given in the All india Motor Tariff.
7. Car insurance premium is linked to location and cubic capacity of the vehicle
Your car insurance premium considers the cubic capacity of your car’s engine along with your geographical location. Therefore, for the same make and model, living in metropolitan regions may mean that you end up paying a higher insurance premium compared to living in a semi-urban or rural area. It all depends on the location of the RTO where your car registered.
8. Benefits of Add on Covers for Motor Insurance
Just like everything little additions in life things just get better. Similarly getting add-on covers will help you a much-enhanced cover and help in fighting financial imbalances in case of accidents. The various types of available add-on cover under Motor Insurance includes –
- Zero Depreciation: You will not face depreciation devalue and get full coverage for repairs at the time of accident to vehicle.
- Engine and Gearbox Protection cover: You will be covered for unpredictable weather like Heavy rains and floods which tend to damage your car engine, leading to hydrostatic lock etc.
- Return to Invoice: You will get the differential amount of IDV and Invoice in case of total loss and allow you to happily buy a new car.
- Cost of consumable items: This includes the cost of Nut, Bolts, gaskets, sealant etc. normally not covered in the accident.
- No Claim Bonus Protection: Intact your No Claim Bonus for next renewal.
9. Pay as You Drive Insurance Policy
Under the Stand Box project of IRDA a few shortlisted companies are offering usage-based Motor Insurance Products and premium depending on the pre declared kilometers. The product benefits those who drive less.
10. Dedicated Garage Facility
Cashless claim settlement is better as it saves your valuable time and you are also not required to pay the whole amount. So, while buying the Car insurance, check for the availability of Network of Garages (Workshops) to repair your vehicle in the unforeseen event of occurrence of any accident/accidental loss.
If you are facing any difficulty with regards to Car Insurance delay in claim process, claim rejection etc., you can contact us at Insurance Samadhan. We are always there to help! At InsuranceSamadhan.com, we have helped resolve over 12,600 customer grievance cases in the past related to all types of Insurances, ULIPs and other financial products.
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