Why should car owners buy a comprehensive car insurance policy when they already have a third-party car insurance policy in place? It covers damages to the third party from a collision with the insured car–isn't that enough?
Even extra cautious drivers can meet with accidents. And accidents not only damage the third party or their property but can damage the insured car and its driver. In such a scenario, the repair expenses will be an out-of-the-pocket expense for the car owner.
If the car owner decides on a comprehensive car insurance policy, it would limit their loss to a nominal amount of comprehensive deductibles. The insurance will take up most of the financial burden.
This post lists factors to consider to get the maximum coverage from a comprehensive car insurance policy.
Questions to Ask Before Buying a Comprehensive Car Insurance Policy
Planning car insurance for a brand new car or unhappy with the past decisions in purchasing comprehensive car insurance? We have guidelines that can help you choose the right car insurance policy.
What are Your Car Insurance Requirements?
Car owners are not the same; they differ in the place they reside, their driving style, the hours they drive, etc. Thus, a car insurance policy that works for one may not necessarily suit the other.
For instance, a car owner with no secure parking space and who lives in an area infested with car thieves will need a Return to Invoice add-on in car insurance. Those who travel a long distance once a month may need to choose a usage-based insurance plan like telematics.
Therefore, car owners must take stock of their requirements before choosing the best car insurance for their vehicles.
Where to Find the Best Comprehensive Car Insurance?
The car owner must then look for the best insurance provider based on their requirements; narrow done to a few that offer the best deals for a set of primary and add-on requirements. The search becomes effective through online comparison.
Check the company's financial health by considering its car insurance claim settlement ratio (CSR), claims handling procedure, time taken to settle claims, customer reviews, and testimonials. Check the financials of the insurance provider and learn their strategies from the past for the present and future.
How Much Does the Car Insurance Policy Cover?
Insurance providers generally provide three types of car insurance coverage in India, and they are:
Third-party Car Insurance Cover
Third-party car insurance protects against losses to third parties from a collision with the insured car. The maximum limit in case of the third-party's death is unlimited; in case of damage to third-party property or injury to a third party, the maximum claim amount is INR 7.5 lakhs.
Comprehensive Car Insurance Cover
A comprehensive car insurance cover has more features than a third-party car insurance cover, thus offering more extensive coverage to both the third party and the insured's car.
Own Damage
Own Damage car insurance cover is helpful in car damage caused by natural disasters such as storms, earthquakes, floods, etc. It also includes manmade disasters like vandalism, riots, and terrorist attacks.
How to Choose Add-ons for the Best Comprehensive Insurance Policy?
Insurance providers offer several car insurance add-ons; however, their cost will exceed that of the comprehensive insurance policy. To avoid an extravagant insurance policy, the insured must carefully choose the add-ons. We have listed a few essential add-on covers below,
Zero Depreciation Cover
Zero depreciation in car insurance covers the loss due to depreciation and ensures higher settlement amounts to the insured on claims. This cover is, however, allowed for vehicles up to five years old.
Return to Invoice Cover (RTI)
RTI in car insurance is important for people living in locations that report several car thefts or are exposed to calamities, both natural and manmade, causing the car to be declared a total loss. The insured will receive compensation equal to the car's invoice value while buying the insurance policy.
Road Assistance Cover
Road assistance car insurance add on coverage is helpful during a car breakdown in the middle of the road and receives immediate assistance. The insured needs only to make a phone call responding to which the insurer will arrange for a mechanic to assist with the necessary repairs.
Engine Protection Cover
The engine is the most important part of the car, and daily wear and tear can damage it. A standard insurance policy, however, does not cover these expensive repairs. But when the insured get themselves an engine protection car insurance add on cover, they are protected against liabilities that arise from oil spills, water ingress, or mechanical breakdown.
No-claim Bonus Protect Cover
The car insurance premium in the following year would be lower if there were no claims during the previous car insurance policy term. This discount is known as the NCB. If any claim is filed, the NCB will be void. The NCB protection cover in car insurance allows you to enjoy the discount even if you file a claim.
Understand the Terms and Conditions of the Insurance Provider
Generally, the final step while buying a comprehensive car insurance policy is to agree to the terms and conditions of the insurance provider. Although the buyer has the opportunity to read and study the terms and conditions before agreeing to them, they commit one common mistake. They tick it in agreement without even glancing through the document.
If the car owner had taken the time to read the insurance provider's terms and conditions, they would have learned more about the company. Also, if something did not work for them, they could opt out and look for a car insurance provider with more agreeable terms and conditions.
Conclusion
The general opinion of the Indian car insurance buyer is that the cheapest car insurance policy is the best car insurance policy. However, as discussed in the post, it is a wrong notion that can prove expensive to car owners during car insurance claims.
Car owners must know their requirements and research to buy car insurance depending on the benefit-cost ratio. That will enable maximum coverage and make their comprehensive car insurance worthwhile.
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