Everyone gets excited when we buy a new car, we are on cloud nine. Before buying a new car we all make a budget and shortlist the ones according to our suitability and requirements. In India its a type of tradition or ritual to go to the preferred place of worship to seek the blessings of the God. The priest performs a ritual. In Hindus, the priests place a lemon under each tire and run the car over it,  it is considered as a good omen for a good start. As following these traditions is necessary, buying automobile insurance is also necessary to safeguard yourself from any future risks and damages.

In simple terms, automobile insurance means financial protection given by the insurance company to the policyholder. There are two parties involved in the agreement i.e. policyholder and the insurer. Insurance policies are basically divided into comprehensive and third party insurance. Comprehensive insurance protects you from damages happened to your car and the third party insurance acts as a cover for the damages caused to the other person or property by your car.

Before you buy motor insurance, there are a few things that you should keep in your mind.

Types of Motor Insurance

1. Liability Only

The government of India has made compulsory for every vehicle running on the roads of this country to have at least this insurance. This policy provides coverage against legal liabilities which may arise due to injuries, death or property death.

2. Comprehensive Motor Insurance

This type of insurance provides coverage for own vehicle for the damages caused to the other person or property. This policy also covers the damages which are related to man-made tragedies, such as riots, thefts, vandalism, malicious activities, terrorist activities, etc. In addition to that, it covers damages caused by natural disasters like floods, earthquake, landslides, storm, etc.

In India it’s compulsory to have third – party insurance, it would also be a wise decision to opt for comprehensive motor insurance because it provides adequate coverage for the damages for your vehicle. When it comes to buying insurance, never be underinsured.

Imagine a situation –  you went into a restaurant after parking your car and when you came back, you saw that there is a dent in your car. You became disheartened after seeing it. When you went to the mechanic to get the dent fixed, the repairing cost broke your heart a little more.

Book a test drive today.

The following are the factors that you should consider before buying car insurance.

  1. Daily Allowance –  You get money from your insurer for hiring another mode of commuting when your car is under repair.
  2. Lock/ Lost Key Replacement Cover –  If you lost your car keys or it is stolen, you get the cover to replace them. Also, you get cover for lock replacement if your car was broken into.
  3. Stay at a Hotel –  You are entitled to get a hotel stay on your insurance provider’s behalf if your car has become immobile because of an accident.
  4. Invoice Cover Return –  Under the coverage when there is a loss because of some accident, there is a difference between ‘claim amount receivable’ and ‘purchase price of a vehicle’.When this happens, the rider bears that amount of difference from his pocket.
  5. No Claim Bonus – You receive no claim bonus (NCB) when you don’t file a claim. Some people don’t want to miss out the NCB to get that bonus, so they don’t file a claim.  You retain the existing NCB even if you just make one claim during the policy tenure. In this way, your no claim bonus is safeguarded.
  6. Depreciation of Reimbursement Cover – This is an add-on feature which offers full claim without deducting depreciation on the cost of replaced parts.
  7. Repair of glass, rubber, plastic and fiber parts –  Damaged glass, plastic, rubber, and fiber parts can be repaired without affecting your No Claim Bonus (NCB).
  8. Lost Personal Belongings and Baggage Cover – If you don’t have an anti-theft device which is approved by the ARAI (Automobile Research Association of India), you can get coverage from your car insurance company.

Companies Might Not Cover You For

  • Normal depreciation and usual aging of the vehicle
  • A major decrease in the car’s value
  • Technical and electrical problem
  • Depreciation of tires and tubes
  • Damage caused by/to a person without driving license
  • Damage caused by/to a person driving the vehicle under in the influence of alcohol or drugs.

Note: Always check the above points when purchasing a car insurance policy.

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