Avoiding mistake while buying car insurance will help you to overcome claim rejection. To avoid the rejection take the tips from expert and don't make mistakes while buying car insurance. Also compare the best car insurance to get insurance at best and affordable price.
What will happen if you make some common mistakes while buying a new car insurance plan?
- Even after buying the policy, your claims may get rejected.
- Your policy can get cancelled & you’ll lose all the premium money you’ve paid.
Hence, we have prepared a list of mistakes to avoid while buying a new car insurance plan. Knowing about these mistakes will help you buy the best car insurance plan in a reasonable budget.
Not comparing different policies before purchasing
You should always compare different types of policies and their respective plans.
For example, you should consider purchasing comprehensive car insurance instead of a third party car insurance. Check the table:
| Third Party Car Insurance Policy | Comprehensive Car Insurance Policy |
|---|---|
| Low premium but limited coverage | High premium but large and wide coverage |
| Covers only 3rd party property damages & injuries | Covers 3rd party & own injuries & property damages due to thefts, fire, accidents, natural & man-made calamities |
Choosing a limited or small cover to save money
- Although it’s mandatory to buy third party car insurance, you should always opt for comprehensive insurance with a large cover.
- Buying just a third party insurance will prove very expensive from a future perspective. This is because your own car will sustain many damages due to both, man-made & natural calamities
Not looking at policy deductibles
For Example,
- Let’s say your insurance claim amount is 1,50,000/-
- The deductible amount of your policy is 50,000/-
- This means you have to pay 50,000/- & the balance amount of 1,00,000/- will be paid by the insurance company.
Do not buy a policy with a low premium just save money because it has a high deductible amount. Check the table:
| Lower the premium | Higher the premium(Rs) | |
|---|---|---|
| Higher the deductible amount. | Lower the deductible amount. | |
| RESULT | You end up paying a lot out of your own pocket. | You end up paying a lot less out of your own pocket |
Purchasing unnecessary add-ons
Insurance add-on riders increase your policy’s value. However, purchasing unnecessary add-ons may also increase your policy’s cost, without reducing any risks.
For Example,
- An engine cover add-on is required to protect your engine due to floods or water logging.
- It makes sense to buy an engine cover add-on if you are living in Mumbai city or any other area that’s prone to water logging.
- However, it is unnecessary to buy this add-on cover if you’re living in an area that doesn’t have heavy rainfall and water logging issues.
Thus, take an expert’s guidance on which add-ons to buy and which to avoid.
Not understanding policy terms & conditions
- Read & understand all terms and conditions from your insurance agents.
- If you’re unaware about certain terms & policy conditions, your claims will get rejected.
For example, however large your comprehensive insurance policy might be, it does not cover the following;
- For example, however large your comprehensive insurance policy might be, it does not cover the following;
You can’t carry out repairs due to wear & tear and then file for a claim. It will surely get rejected.
Key Takeaways
- Always compare different policies before purchasing one.
- Choose a policy with a large coverage.
- Go for policies with lower deductibles.
- Don’t purchase add-on riders that you don’t require.
- Read policy terms & conditions carefully.
Also Read: Third-party Insurance Premiums Likely to Increase in 2022
