It would not be wrong to say that there are lots of myths that revolve around car insurance. Due to these misconceptions, many people fall into a trap and make mistakes. Thus, it is important to get rid of these myths that surround car insurance so that one can seamless car insurance experience. Below are some car insurance myths that need to be busted.
Car Insurance Myths Decoded
MYTH 1: Old car doesn’t need car insurance
FACT: It is mandatory by law
Even if your car is old, it is still mandatory to have at least third-party car insurance. Depending upon your usage or budget, you can choose any type of policy and must insure your vehicle. Your old car cannot run on Indian roads without valid car insurance.
MYTH 2: You Cannot Change your Insurance Company
FACT: You can change it easily
Many people still believe that once you have purchased a car insurance policy from one company, you cannot change it. The fact is that a policyholder can easily transfer his policy from one insurance provider to another. Compare different insurance companies, in case you are not satisfied with your current one and choose the best one.
MYTH 3: Discounts under NCB will be Lost on Changing an Insurance Company
FACT: Your NCB stays with you
Even if you change your car insurance company, your no-claim bonus will not be collapsed. You are still eligible to receive discounts under NCB and can transfer your NCB along with your policy to your new insurance provider. The catch here is that you need to transfer your NCB to a new insurance company within 90 days before your old policy expires.
MYTH 4: You Only Get Insurance Coverage in Case of an Accident
FACT: The coverage of car insurance is much more vast
The policyholder not only gets claims under accidental situations but various other mishappenings such as natural calamities, man-made disasters, theft, fire, etc are also covered under car insurance.
MYTH 5: In case of own car damage, the full claim amount equivalent to the on-road price of my car will be settled
FACT: That is not true. The claim process works differently
Your final claim settlement amount will be calculated after taking into account the present IDV of your car, not the actual on-road price of your vehicle. The depreciation cost (if not opted for depreciation cover) will be deducted while calculating the total value of the loss.
MYTH 6: You cannot change your car insurance policy tenure
FACT: The policy owner can change his policy tenure based on his needs.
For example-A, the multi-year policyholder can shift to a single-year policy and vice-versa. However, the policyholder can do so at the time of renewing his policy as many insurance companies do not allow it in the middle of a running policy.
MYTH 7: It is not important to renew your expired/lapsed car policy
FACT: Always renew your car insurance policy before its expiry
For car owners, it is mandatory to own a valid policy. And, for that, you should timely renew your policy before it gets expired or lapsed. As driving with an invalid car insurance policy is a punishable offense
MYTH 8: I need to pay a higher premium as my car is new
FACT: The premium is not only based on age but make, model, and cubic capacity also
People have this preconceived notion that in the case of a new car, the premium would be high. Though there are multiple factors that govern the premium of car insurance. The make, model, cubic capacity, anti-theft accessories installation, policy type, etc all decide your premium.
For an example-The premium of a new Hyundai Grand i10 would be less as compared to a new Hyundai Creta/Maruti Suzuki Brezza because of their price.
MYTH 9: I am a good driver so I don’t need a car insurance
FACT: Irrespective of your excellent driving skills, it is mandatory to buy a car insurance
Even if you drive carefully, according to the Motor Vehicles Act, 1988, it is compulsory to own car insurance (at least a third party). Uncertainties can happen in life without any warning. Thus, be a responsible citizen as owning car insurance will not only financially protect you but also others from mishappenings.
MYTH 10: I cannot make claims for an accident as the car was not driven by me
FACT: As long as your car is insured and is driven with a valid driving license by someone, you can file a claim
This is also one of the common myths that people have. The policyholder can file a car insurance claim even if he is not driving his car. But the driver must have a valid driving license and your car must be insured.
With the help of reading these myths, hope all your doubts and confusions will be cleared. Thus, you would be able to make informed decisions in the future related to car insurance.