When you buy a new car, the dealer almost certainly will provide you with car insurance. Thus, we do not spend a lot of time in understanding the policy or its benefits. However, when the renewal period arrives, one starts to spend some time on car insurances and finding out the best ones. Sure, there are the usual insurance benefits but apart from that car insurance makes it legal for you to drive your car in India. Thus, if your renewal is just around the corner do not take it lightly and start looking out for a car insurance policy.
Car Insurance- Get All the Basics Right
Imagine this, you take your car out for a spin and some idiot rams his car into your car. Though there is no fault of yours, you will now have to pay for all the expenses of the car. If you have a hatchback, the headlights repair would cost you on an average of Rs.3500, bumper Rs.5000, any damages to the fender would account for additional Rs.5000. You see where this is going. Even if it’s a scratch, you will have to repaint the entire part, be it the door or bumper.
If you do not have car insurance, a small to a medium accident would seriously dent your bank account. Not to mention the hefty fines the traffic police might charge you with when they find out that you do not have car insurance. To keep yourself safe from any such unexpected events, getting a car insurance is a must. There are no doubts that you could be an exceptional driver with some serious driving skills, but given our road conditions and the variety of people behind the wheels of other cars, that is too much of a risk to take.
There are usually two types of car insurance that insurers offer, third party liability and comprehensive car insurance. We will learn a bit more about them in the following segment. So here are the main reasons why you should opt for car insurance.
- Makes your car road legal in the country.
- Pays for the damages to your as well as other cars, people or property that you come in contact with.
- Coverage against natural calamities such as flood, earthquake and so on.
- Personal accident insurance should the insured pass away as a result of an accident or face disability of any form.
- Covers your car against vandalism or theft, so that you do not lose your sleep over it.
A Brief Overview of Car Insurance
A third party liability is the most basic form of car insurance that you can buy. In fact, it is the bare minimum requirement for your car to be legally on the Indian roads. In the event of an accident, if there is any injury or damage to another person or property, your insurer will pay for the same. This is also the cheapest car insurance that you can buy but not the recommended one. The premium amounts largely depend on the engine capacity of the car.
A comprehensive car insurance is what you should opt to buy. Why you ask? Well, it not only provides the bare minimum third party liability cover but also a lot more than that. When you have a comprehensive insurance, it also pays for own damages. Comprehensive car insurance also makes way for NCB or No Claims Bonus. It is a simple mechanism by which you can save some money on your insurance premium. It only kicks in if you haven’t claimed your insurance within a certain time period.
You can reduce the burden of car insurance premiums by using any of the following methods.
- Select Right IDV
Insurance premiums are directly related to IDVs, so a lower IDV translates into a lower premium.
If you are someone who hasn’t claimed their car insurance policy, NCB is yours for the taking. You can avail discounts of up to 50% under this section.
- Security Devices
Insurers love policy holders who have security devices installed on their cars, thereby, reducing their premiums.