Car Insurance

Car Insurance FAQs

• 1. What important documents are required for a car insurance claim?

  Take a look at the list of the documents below:

  a)A Copy of insurance policy

  b) Driving Licence: if claim had occurred while plying on the road

  • Claim form appropriately filled (a copy of the same can be kept with the policyholder for future reference)
  • Registration Certificate along with the original for verification
  • Pollution Certificate Copy (On lines with recent central govt. amendment in law
  • Fitness Certificate of the vehicle
  • Copy of FIR

  a) For Commercial Vehicle, every 5, 3, 1 years depending on the class of vehicle

  b) For Private car it is 15years in case of private car

  • In case of NCB availed in the policy “NCB confirmation” from previous insurer
  • Vehicle permit: if the vehicle is a commercial vehicle
  • Repair estimate - it is given by insurance company
  • Spot photos & intimation to police authorities if vehicle has sustained multiple impacts or involved bodily injury

  Other than the above mentioned from case to case basis the requirement may vary

• 2. How to make a claim if a car is stolen?

  Following are the steps you need to follow if your car gets stolen:

  • Inform your insurance company without any delay
  • Next step is to lodge an FIR
  • Insurance company appoints investigator to verify facts and coordinate with insured
  • RTO is being informed to cancel vehicle registration, the acknowledgment of the same is provided by Transport authority

  It is advisable to keep these documents handy while making a claim:

  1. Copy of the policy document
  2. Duly signed claim form
  3. Registration Certificate
  4. Copy of FIR
  5. Keys (two sets) of the vehicle
  6. NTC - Non-Traceable certificate duly attested by court authorities
  7. RC Cancellation acknowledgement from RTO

• 3. What are the factors that affect your car insurance policy?

  Following are the factors that affect your car insurance policy:

  • The IDV (Insured Declared Value) of the car
  • The age of the car (If your car is a used one)
  • Zone/City of Registration
  • Cubic capacity of the car engine
  • Previous year Claim Status & NCB
  • Policy Type
  • Policy Tenure
  • Make, Model and Variant of Car
  • Deductibles
  • Premium

• 4. What if my car insurance policy expires?

  If your car insurance policy has expired, your car will be inspected by the vehicle inspector appointed by an insurance company. Car inspection is a chargeable process, you can read more about the same in your policy document. However, it is advisable to renew your policy within 90 days of expiry, else you will lose the benefit of NCB.

• 5. What is third party car insurance?

  Third party car insurance is a mandatory insurance policy that a vehicle owner must have. This policy offers a cover against any legal liabilities to third parties in case of an accident or damage. In case of death/bodily injury, the sum assured is unlimited. But in case of third party property damage, the liability cover is up to Rs.7.5 lakh. 

• 6. What are deductibles? What is the difference between Compulsory Deductible and Voluntary Compulsory Deductible?

  Deductibles are a part of car insurance claim amount which is borne by the policyholder at the time of claim. During the process of claim settlement, the policyholder has to pay a certain amount from his pocket and the rest of the amount is paid by the insurance company, this is known as deductibles.

  Compulsory Deductible: It is an amount which is mandatory by the Insurance Regulatory Development Authority of India (IRDAI). Based on a  cubic capacity of a car engine, IRDAI has fixed a certain amount under Compulsory Deductible which is to be borne by a policyholder in case of claim.  For private cars of 1500cc, the compulsory deductible is Rs. 1000 and for cars which are below 1500cc, the fixed amount is Rs.500.

  Voluntary Compulsory Deductible: It is optional for a policyholder to opt. It is a certain amount that a policyholder agrees to pay from his pocket at the time of claim. It inversely affects your car premium amount. In case you have opted for a less amount of VCD, the premium of your car will increase. And, if VCD is higher, the premium will be reduced. 

• 7. Can I cancel my car insurance policy and get a refund?

  Yes, you can cancel your policy and can also get a refund. Before canceling your policy, make sure you have a valid/genuine reason to cancel the same. You need to think of the consequences of canceling your policy and then take an informed decision. However, in case you want to cancel, these are the basic steps you need to follow. Though different companies might follow a different process, basic steps remain the same:

  Step 1: Inform your insurance company about your decision

  Step 2: Based on your reason of cancellation, you need to submit the necessary documents 

  Step 3: Your insurance company will verify the documents. After the successful verification of documents, your policy cancellation request will be approved and a canceled policy will be sent to your mail ID.

  In case of a refund amount, the exact turnaround time varies from companies to companies. However, within 14 working days you can get your refund.  

• 8. Is unnamed passenger cover a part of comprehensive car policy?

  Yes, unnamed passenger cover can also be taken as an add-on cover under Personal Accident Cover in comprehensive car insurance policy. To opt for this, you have to pay an extra amount and can provide protection to co-passengers in the car such as-family, friends or colleagues. 

• 9. Why is third party car insurance not enough?

  Third party car insurance only covers damages/loss and legal liabilities of third parties only and does not cover accidents and damages to one's own vehicle. The policyholder does not get coverage for his own vehicle hence third party cover is not enough.  

• 10. Is it mandatory to inform the RTO regarding any changes I make in my car?

  Yes, it is mandatory for a policyholder to inform RTO as well as his insurance company regarding the changes done in the car. 

• 11. What would be the possible reasons for car insurance claim rejection?

  There are some factors on the basis of which your car insurance claim can be rejected. 

  • Incomplete documents
  • Incorrect information mentioned in policy document 
  • Car is repaired before making a claim
  • Claim against exclusions
  • Lapsed policy
  • Non disclosure of car modifications
  • Disobeying rules and regulations

• 12. What is depreciation in car insurance?

  Depreciation is a reduction in the value of your car over a certain period of time. The reduction value of your car depends on the usage of your car. The unavoidable cost of wear and tear involved in the maintenance of a car is known as depreciation. Your car loses its value constantly due to depreciation. The insurance companies will only cover a certain portion of expenses incurred to replace the damaged portions of the car. The rest of the amount is calculated based on the cost involved in depreciation. 

• 13. How to get the best car insurance policy?

  The best way to get an ideal car insurance policy is to compare multiple insurance providers online. Compare multiple quotes and then take an informed decision of purchasing the best policy. 

• 14. Can I get insurance against natural calamities?

  Yes, under comprehensive car insurance policy,natural calamities like-flood, cyclone, earthquake, hurricane, etc are covered. 

• 15. Can I shift the vehicle from the spot of the accident?

  If the vehicle is in movable condition, you can shift the same to the garage. Else, if the condition is worse, you shouldn’t try to move the vehicle. 

• 16. How immediately should I file for a claim?

  In case of theft, you need to inform your insurance company within 24 hours. And, in case of accidents, you need to furnish all the formalities within 48 hours. 

• 17. Can I buy an add-on only instead of buying a car insurance policy?

  No, you cannot buy add-on as standalone as they can only be sold with a car insurance policy. Hence, you must buy a car insurance policy, in case you want to buy the add-ons.  

• 18. What is roadside assistance cover?

  This type of cover provides services related to car breakdown in the middle of a road. With this cover, you can get proper assistance at any time of the day and night. You can get assistance regarding towing service, repairs, changing flat tyres, emergency fuel refueling, etc. 

• 19. Can I buy add-on covers online?

  Yes, you can easily buy add-on covers online to have better coverage and enjoy maximum benefits offered by your policy. 

• 20. What type of events are not covered in car insurance policy?

  Following are the exclusions in car insurance policy:

  • Mechanical/ Electrical breakdown
  •     Wear and tear, ageing of vehicle
  •     Consequential loss
  •     Depreciation
  •     Deliberate accidental loss
  •     Intoxicated driving
  •     Any contractual liability
  •     Damage to/ by a person driving any vehicle without a valid license

• 21. Why one should have a comprehensive car insurance policy?

  Comprehensive car insurance policy offers complete protection and better coverage as compared to third party insurance. Under this policy, not only the legal liabilities of third parties are covered but the cost of your own damage is also covered. Apart from this, the loss and damage caused by man-made activities and natural calamities are also covered under comprehensive car insurance policy.  

• 22. What are cashless and reimbursement car insurance claims?

  In cashless claims, the insurance company will directly settle the claim with network garage and the policyholder doesn’t need to pay for the damages from his pocket. Whereas, in case of reimbursement claims, the policyholder firstly needs to pay the damages cost/expenses from his pocket to the garage and then can reimburse the same amount later from his insurance company. 
   

• 23. How premium is calculated for car insurance?

  When it comes to calculating the premium of a car, there are various factors to be considered. The premium of a new car would be different from an old car. Below are the factors that play a key role in the calculation of car insurance premium:

  • Age of the car
  • Whether the car will be used for personal or commercial purposes
  • Fuel type
  • Insured declared value
  • Cubic capacity of the car’s engine
  • Area where the car was registered
  • Accumulated no claim bonus, if any
  • Owner-driver’s personal details including
  • Age
  • Gender
  • Occupation
  • Voluntary deductibles

• 24. What is No- Claim Bonus(NCB) in Car Insurance?

  NCB in car insurance is the discount that a policyholder can get for not making a claim during the policy tenure. A car insurance policyholder can collect/accumulate up to 50% of NCB discount for every claim-free year up to 5 years. 

  No. of Years	Discount
  One claim-free year	20%
  Two consecutive claim-free years	25%
  Three consecutive claim-free years	35%
  Four consecutive claim-free years	45%
  Five consecutive claim-free years	50%

• 25. What is IDV in car insurance?

  Insured Declared Value is the current market price or value of your car. It is the maximum sum assured amount that your insurance company will compensate for the claim.  IDV changes every year after adjusting the depreciating cost. 

• 26. How do I know which add-on cover is important for me?

  You need to evaluate your policy first and check how much cover or benefits you are getting. Understand your needs and if you feel like your policy cover is not enough, you can decide on including an add-on cover to your policy. Check various add-on covers and based on your actual need, you can choose to include as many add-on covers as you want in your policy. 

• 27. Can I get discounts under car insurance policy?

  Yes, you can avail discounts under car insurance policy. You can Voluntary Deductible discount and No Claim Bonus discount on your car insurance premium. 

• 28. What are the benefits of buying car insurance online?

  There are multiple benefits you can have if you buy your car insurance online

  • Compare different insurance companies
  • Instant and easy to buy
  • No physical paperwork
  • Save time and money
  • Secure and safe online mode of payment

• 29. What are the different types of car insurance policies?

  There are majorly 2 types of car insurance policies, i.e. Third Party and Comprehensive. All insurance companies offer both these policies to the customers. However, there is one more type of insurance policy available, i.e. Pay As You Drive which is also offered by many insurance providers. 

• 30. Is there any limit to the number of add-ons I can choose with my car insurance policy?

  No, there is no such limit. You can add as many add-on covers as you want in your car insurance policy. 

• 31. Can I pay my car insurance premium in installments?

  No, you cannot pay your premium in installments. You have to pay the full premium at a time of your car insurance till your policy tenure.

• 32.Can I get a duplicate car insurance policy.

  Yes, you can get the same. For that, you need to get in touch with your insurance company. 

• 33. What is the tenure of a car insurance policy?

  A car insurance policy can be issued for a period of 1 year or multi-year. It is advisable to renew your policy before your expiry date to avoid any hassle in the future. 

• 34. If I include an add-on cover, how much will my car insurance premium increase?

  The price of each add-on cover varies and is dependent on several factors like vehicle age, vehicle type, location, etc. You can use an online calculator to know the exact cost of your premium. 

• 35. Is it possible to opt for an add-on cover at any given time?

  Yes, you can opt for an add-on cover at any point of time and enjoy extra benefits. 

• 36. Is it mandatory to renew my third-party car insurance every time?

  Yes, it is mandatory to renew your third-party car insurance every time before its expiry.

• 37. What to do if my previous car insurance policy has expired?

  You can renew your expired car insurance policy by submitting the required documents for the same. In case you want to change your insurance company, you can also do that and buy a fresh policy with a new insurance company. 

• 38. Is it mandatory to opt for add-on covers only at the time of policy renewal?

  No, it is not mandatory to opt for add-on covers only at the time of renewal but it is advisable to opt for them during that time.

• 39. Can I make changes in my car insurance policy?

  Yes, you can make the changes related to-name/address rectification,registration number,change in vehicle/model, transfer of ownership, anti-theft device, change in RTO registration, NCB recovery, addition of hypothecation, etc. Based on your request, you need to submit the required documents hence can easily do changes in car insurance.

• 40. What is ARAI in Car Insurance Policy?

  It stands for Automotive Research Association of India, wherein if a policyholder has installed an ARAI approved anti-theft device in his vehicle, whose installation is duly certified by this agency, he gets a discount of 2.5% on the premium of Own Damage, subject to maximum of Rs.500.

• 41. What is endorsement in car insurance policy?

  An endorsement is a written proof of an agreed change in the car insurance policy. This document incorporates changes in the terms of the policy.

• 42. Can I take a policy, if a LPG/CNG kit fitted in my car is not endorsed by RC?

  No, you cannot take a policy until and unless your LPG/CNG kit is duly endorsed on the RC by the RTO. 

• 43. What are the different modes of payment to buy a car insurance policy?

  You can choose from multiple modes of payments such as:

  Credit Card, Net Banking, Debit Card, Cash Card, Cheque/Demand Draft

• 44. When is it mandatory to file an FIR in car insurance?

  Incidents such as-Third Party Property Damage, Bodily Injury to Self/Third Party, Accidents , Theft must be reported to the nearest police station so that an FIR can be filed.

• 45. What if actual expenses are more than the cover of your car insurance policy?

  In such a case, the insured will have to pay the difference from his pocket as his insurance company will only pay the amount he is insured for. 

• 46. Am I eligible to get a personal accident cover, if I am not the owner of the car but I was driving the vehicle also paying the premium?

  Technically, personal accident cover is for the owner of the vehicle. But in case of an unnamed driver, the personal accident cover can be purchased separately as an add-on by paying extra premium. 

• 47. Can I buy add-on covers with third-party car insurance?

  No, you cannot opt for add-on covers in case of third party car insurance. 

• 48. Can I avail roadside assistance 24x7 with my car insurance policy?

  Yes, roadside assistance is available 24x7 in your car insurance policy. 

• 49.Are there any exclusions under roadside assistance in car insurance policy?

  Yes, there are certain exceptions under which you cannot get roadside assistance:

  • Conditions of earthquake, war, invasion, rebellion, revolt, riot, civil commotion, civil war, exceptional adverse weather conditions, acts of terrorism, nuclear fission, strike, act(s) of government(s)/ government agencies/ judicial/ quasi-judicial authorities
  • If vehicle is being used for the purpose of racing, rallying, motor-sports or is not being used/driven in accordance with applicable laws and regulations
  • Any claim where your vehicle can safely be transferred on its own to the nearest garage/ workshop
  • Conditions under theft; any kind of consequential losses
  • Any loss which is covered under any other insurance policy or manufacturer’s warranty
  • Any loss/damage caused to your vehicle when it is being used/driven against the recommendations of the owner’s/manufacturer’s manual
  • Any claims where services have been availed of without the prior consent of the Company

• 50. How many times can I claim for roadside assistance in car insurance?

  You are allowed to make a claim up to 4 times. That’s the maximum number  of claims you can make under roadside assistance.

• 51. Is no claim bonus transferable?

  Yes, NCB is transferable if you change your insurance company at the time of car insurance renewal. 

• 52. How can I reduce my car insurance premium?

  There are various ways to reduce your car insurance premium:

  • Only buy required coverage
  • Set correct IDV of your car
  • Avail NCB
  • Install safety devices
  • Renew your policy on time

• 53. I want to sell my car, do I also need to transfer my car insurance policy?

  Yes, in case of selling, it is important to also transfer your policy to the new owner of the car just to avoid future hassle. The details mentioned in the registration document should also match the details mentioned in the policy document.  

• 54. Can I transfer no claim bonus to a new owner of the policy?

  No, you cannot transfer your NCB to a new owner even if you have transferred your car insurance policy. 

• 55. In partial theft case, is FIR compulsory?

  Yes, FIR is mandatory in such a case. 

• 56. What If my car insurance policy is misplaced?

  Your insurance company provides the soft copy of your policy at the time of purchasing the car insurance.Your soft copy is also a valid policy document.  

• 57. Is car inspection necessary all the time?

  No, it is not necessary to have a car inspection all the time. In case there is a break between your expired and new policy, your car might need an inspection. 

• 58. How will the depreciation of a car depend on its age?

  Depreciation will be calculated as:

  • 6 months or less : 0% depreciation
  • Between 6 months and 1 year : 5 % depreciation
  • Between 1 and 2 years : 10 % depreciation
  • Between 2 and 3 years : 15 % depreciation
  • Between 3 and 4 years : 25 % depreciation
  • Between 4 and 5 years : 35 % depreciation
  • Between 5 and 10 years : 40 % depreciation
  • More than 10 years : 50 % depreciation

• 59. Can I claim the grace period?

  No, you cannot claim under grace period as your policy becomes inactive on crossing the expiry date. Thus, you are not covered against any risks under the grace period.

• 60. How will modifications affect my car insurance premium?

  Modifications improve the look of your car thus the value of your car increase.If you consider adding those modifications in your car, you firstly need to inform your insurance company. Based on the modifications, your policy document will be updated by your company hence your premium will increase. 

• 61. Where can I check the exclusions of car insurance policy?

  The exclusions are clearly mentioned in your car insurance policy document. You can easily read exclusions in your policy document to have more clarity. 

• 62. Is expensive car insurance the best policy to buy?

  Not really. The price of your car insurance policy depends on various factors such-type of policy you choose, tenure of your policy, make/model of your vehicle, add-on covers, etc. But the most important thing here is to know how much coverage you are getting irrespective of the cost of your policy. 

• 63. Why is it important to declare the correct IDV?

  Based on your IDV, the cost of your car insurance policy is calculated. So, if you declare a higher IDV, the premium of your car insurance will be high. On the contrary, if you declare a lower IDV, the premium of your car would be less hence you will receive a lower claim amount. Thus, it is important to declare the correct IDV of your car so that you can reap maximum benefits. 

• 64. How does the age of your car affect its depreciation rate?

  With age the depreciation of your car increases. Your car will be more prone to natural damages or wear and tear as it gets older and older. Thus, the age of your car will be taken into consideration while deciding its depreciation rate, which is calculated as per the table stipulated by the Motor Tariff Act.

• 65. Is IDV important in case of Third-party Liability car insurance?

  No, because in third-party car insurance, the policyholder cannot claim for his own car damages. Thus, no IDV calculation is required. Since third-party insurance only covers third party damages and financial liabilities. 

• 66. What are the exclusions in IDV calculation?

  Based on the invoice value of your car, IDV is calculated. So, the cost you spend on registration of your car or buying a car insurance policy will not be a part of IDV calculation. 

• 67. What is the meaning of cashless in cashless garages?

  Cashless garages come into picture when you want to file a claim for your car insurance. With the help of cashless garages, the claims would be easier as no cash settlement is involved from your side. Your insurance company will directly settle the claim with their network garage hence a policyholder does not have to pay anything.

• 68. What is the importance of surveyors in the claim settlement process?

  When a policyholder raises a claim, the insurance company assigns an inspector or surveyor to check the damaged condition of your car and other vehicles (if involved). After the physical verification is done by the surveyor, he prepares a report and submits the same to the insurance company. Based on that report, your company decided whether to approve or reject the claim made by you.

• 69. Can I make a claim, if my policy had just expired a day before my accident?

  No, you cannot file a claim even if your policy had expired a day before the accident as your policy is not invalid. Thus, it is important to renew your policy on time to avoid the situation of claim rejection. 

• 70. Can I file a claim against personal injuries?

  Yes, all car insurance policies come with Personal Accidental Cover, wherein the owner/driver of the car can get financial protection against bodily injuries hence a claim can also be filed. 

• 71. Are claims under car insurance time bound?

  Yes, you immediately need to inform your insurance company, if possible within 24 hours of the incident and all the legal formalities from your end should also be complete by then. 

• 72. Which type of car insurance should I buy?

  You should always buy car insurance by keeping in mind your requirements. With different insurance policies such as third-party, comprehensive and pay as you drive, you can get different coverage. Compare the pros and cons of all the policies and then decide what policy suits your needs. 

• 73. Which one is better, cashless claim or reimbursement claim?

  Both claim procedures have their own merits, depending upon the suitability of the policyholder. However, the cashless claim procedure is considered to be easy and quick as compared to reimbursement claims.

• 74. How to check the status of a car insurance policy?

  You can easily check the status of your car insurance policy online. You simply need to follow a few quick steps:

  • Visit the official website of your insurance company
  • Login to your profile with your online credentials
  • You will see your car’s registration number on the right-hand side of the page
  • Click on ‘View Details’ and there you can check the status of your car policy