CAR INSURANCE GUIDE FOR BEGINNERS

 CONTENTS

• Introduction
• What are the types of Car Insurance?
• factors that influence car insurance premiums?
• What are the add-ons that will help you in the long run
• Motor Insurance Companies in India
• Terms related to car insurance
• Conclusion

INTRODUCTION

Whether you buy a car out of necessity or out of leisure, it becomes your priced possession. It is an investment that involves a lot of savings and planning.

So, what do you do for the protection of your priced possession? Probably not much.

In India, it is mandatory by law for car owners to have third-party car insurance for their cars on Indian roads. However, it is not really enough!

When you engage in an accident, third-party insurance will cover the damages that are done to the other party involved in the damage.

But, what about the damages that your car goes through?

That is where an own-damage policy comes into the picture which will cover the costs of repairs for your car.

This car insurance guide for beginners article is an overview of car insurance in India and the things that you need to know about car insurance.

This Car insurance guide for beginners will help you a lot  ..Leave your comment below if you want to ask about the car insurance guide Get Quote 

WHAT ARE THE TYPES OF CAR INSURANCE? 

These are the types of car insurance in India:

1. Third-party car Insurance online

Third-party insurance is mandatory for all four-wheelers in our country under the Motor Vehicles Act, of 1988. It is coverage against legal liabilities that would arise if your car has caused damage to any person or property. However, it will not provide cover for your own car.

It includes:

• Coverage when there is an accident that results in the death or permanent injury of a third party.
• Coverage for the damages caused to third-party property.
• Personal accident cover for the driver.

2. Comprehensive Car Insurance online

An own damage cover (or first-party car insurance cover) will provide protection against the damages that are incurred to your own vehicle arising out of accidents, natural disasters, theft, etc.

A comprehensive car insurance cover is a combination of own damage cover and third-party cover. Also known as package policy becomes the best protection that you can offer to your car.

A comprehensive car insurance policy will include:

• Cover against third-party liability (person or property).
• Cover against the damages caused to your car by accident, man-made and natural disasters, etc.
• Personal accident cover for driver.

WHAT ARE THE FACTORS AFFECTING  INSURANCE PREMIUMS?

A car insurance premium is affected by numerous factors and if you want affordable coverage, it is necessary to know about these factors. Given below are the factors:

1. Location

Believe it or not, your geographical location will affect your car insurance premium. If you live in an area where there is a lot of traffic or your area experiences frequent thefts or it is an accident-prone area, it is highly likely that your premium will be on the higher side.

Also, insuring cars in a tier-3 city will be much more cost-effective than in a metropolitan city. The location where your car will operate plays a part in your premium.

2. Type of the Cover

IRDA (Insurance Regulatory & Development Authority of India) determines third-party car insurance premiums and hence it is fixed for all insurers. It is usually on the lower side.

When you opt for your own damage cover or a comprehensive health insurance policy, your premiums will go up but so would your cover.

3. Make and Model

The make and model of your car will hugely impact your premium. A sedan or a luxury car will have a comparatively higher premium than a hatchback car. Not just the make and model but also the variant of the model can affect your premium.

4. Anti-theft devices

Anti-theft devices can give a small relief in the car insurance premium rather than the ones that do not have such devices.

5. Discounts

Insurance companies offer various discounts, and their discounts will vary from one company to another. Depending on the company, your own damaged car insurance premium will differ.

6. Add-ons

Add-ons will provide an extra cushion. However, as soon as you opt for add-ons, there is a significant impact on the car insurance premium. Add-ons like zero depreciation, passenger cover, roadside assistance, etc. will be a great help at the time of claims.

7. Deductibles

When a voluntary deductible opts, you contribute a predetermined amount at the time of claim. Deductible will reduce the premium remarkably but at what cost? You will eventually have to pay more at the time of claim if not more. Hence, it is advisable to not opt for a voluntary deductible.

8. Buying Insurance Online

Usually, online distributors charge less than the market. This is because they spend less on operational charges and can offer a higher discount rate.

At compare policy, we believe in providing the best solutions to our clients without putting a dent in the pockets of our clients.

WHAT ARE THE ADD-ONS THAT WILL HELP YOU IN THE LONG RUN?

What if paying a few extra hundred leads to savings of thousands of rupees at the time of claim? Well, it is possible. A few add-ons can help you enhance your car insurance policy to a great extent. While there are some insurers that offer policies that have inbuilt add-on covers, there are covers that you might have to purchase by paying some extra amount.

Here is a list of add-ons that will take your car insurance policy a notch higher:

1. Zero Depreciation Cover

This cover will share the burden of depreciation of the car’s parts which can in turn provide the customer with a higher claim. The older the car, the higher would be the depreciation, resulting in the settlement of a lower amount of claim. Zero Depreciation cover will ensure that your car’s parts and replaced or repaired without depreciation.

It is important to keep in mind that Bumper-to-bumper is usually not available for cars more than 5 years old.

2. NCB Protection Cover

A No Claim Bonus Protection cover will protect your NCB despite raising a claim. This will help you gain the benefits of NCB even after making a claim. However, this add-on will only be applicable to its own damage policy and not third-party.

3. Return to Invoice

The invoice value of an old car cannot be received when depreciation is accrued over the years. This is where a return to invoice add-on comes into the picture. It enables the car owner to receive the invoice value at the time of total loss or theft of the car. Therefore, you can get a higher claim amount.

4. Loss of personal belongings cover

When your personal belongings get stolen from the insured car, it is this add-on that will help compensate for those belongings. Electronic equipment like phones, laptops, etc. can also be covered under this add-on.

5. Passenger Cover

This add-on will provide medical cover for the passengers in case of an accident. Your near and dear ones will be protected, and the insurer will cover hospitalization costs, medical costs, as well as ambulance costs.

Compensation will be provided in case of the death of the passenger.

6. Roadside Assistance

Imagine a situation where you are in the middle of a secluded highway and suddenly your car makes a gurgling sound and breaks down. You try every technique possible, but it won’t budge. You are now stuck in the middle of nowhere with no help.

To avoid situations like this, a roadside assistance cover can come to the rescue. Just a call away, and the insurance company will arrange for a mechanic for your car.

7. Engine Protection Cover

The damages caused to the engine due to waterlogging, leakage of oil, mechanical and electrical breakdown of the engine, etc. Similar to Zero depreciation, older vehicles cannot opt for this particular add-on.

8. Consumables Cover

There are parts of the car that need to be replaced frequently due to their wear and tear. These include brake oil, engine oil, lubricants, nuts, bolts, etc. With this add-on, you can get coverage for replacing these items that get damaged.

9. Key Replacement Cover

In today’s generation, there are many high-end and technologically advanced cars that have keys that are extremely expensive, and their replacement costs can go sky-high. A key replacement add-on will cover the expenses of a lost key, stolen or damaged key, and lock set.

10. Tyre Protect Cover

A tyre protection cover is an add-on that will provide a cover for the repair and replacement of tyres. The following is covered when you opt for this add-on:

• Cost of replacing the damaged tyre
• Labor charges toward removing and fitting the tyres
• Accidents

TOP CAR INSURANCE ONLINE & OFFLINE COMPANIES IN 2023

• Bharti AXA General Insurance Company Limited ( Bharti exa car insurance )
• HDFC ERGO General Insurance Company (HDFC ergo car insurance)
• ICICI Lombard General Insurance Company Limited ( icici lombard car insurance)
• Kotak Mahindra General Insurance Company Limited (Kotak Mahindra car insurance )
• IFFCO Tokio General Insurance Company Limited ( IFFCO Tokio car insurance )
• TATA AIG General Insurance Company Limited ( TATA AIG car insurance)
• Reliance General Insurance  ( Reliance car insurance )
• Kotak Mahindra General Insurance Company Limited ( Kotak Mahindra car insurance )
• Shriram General Insurance ( Shriram car insurance)

TERMS RELATED TO CAR INSURANCE OR MOTOR INSURANCE 

1. Anti-theft device

These are devices that provide safety for your car against theft. When you have installed such devices, your car insurance premium can go down at least by 2.5 %. The type of devices to be installed will totally depend on your requirement. The following are anti-theft devices that can be installed:

• Alarm
• Keyless lock device
• Electronic Immobilizers
• Steering wheel lock
• Vehicle tracking

2. IDV

IDV, in a simple sense, is the sum insured of the vehicle. It is the selling price of the make and model of the car after deducting the depreciation and the age. It is the maximum amount of claim that the insurance company will pay when the vehicle is completely damaged and beyond repair or it is stolen.

3. Voluntary Deductible

This is an option that you could opt for to avail a higher discount on your car insurance premium. When you opt for a voluntary deductible, you agree to bear a certain amount of the claim amount from your own pockets. Hence, it is not advisable to opt for a voluntary deductible.

4. Cashless Garages

These are those garages that have tie-ups with your insurer and make the insurance claim a smoother one. When you take your car for repairs to a cashless garage, the insurance company will directly settle the bill with the garage. Therefore, it is quite important to take your car to a cashless garage.

5. Break-in

This is a period when you do not renew your car insurance policy on the particular renewal date which leads to lapsing of the policy. This is the period that your car is not covered under an insurance policy and the claims that will arise will have to be taken care of by you, from your pockets.

CONCLUSION

In this day and age, the cost of repairs for the car has skyrocketed, and that is where your own-damage car insurance policy will come to your rescue. Therefore, it is advisable to buy a comprehensive car insurance policy with the necessary add-ons for the complete protection of your car. moreover, if you like this  share the Article “Car insurance guide for Beginners” with your friends and team

You can also check  ” Top 5 best car insurance companies in India 2021-22” Moreover for car insurance quotes contact us: at 9311238042

Facebook

Twitter 

Linkedin

Youtube