When purchasing car insurance, it is critical to understand the notion of coverage.
You drive to work, take your family on chores and pleasure drives, and spend time with friends. As a responsible car owner, you maintain your vehicle in good condition, follow traffic laws, and practise good driving etiquette. So you want to drive your automobile without having to worry about anything. Regardless of your preparations, your car may encounter unanticipated road hazards such as large or minor accidents, breakdowns, tyre bursts, natural/man-made calamities, and so on.
Car insurance is the best way to alleviate financial stress in such instances. Protection is provided for financial losses resulting from any unfortunate events involving your car under all types of car insurance online or offline, subject to the specific terms and conditions of your policy.
When your car is involved in an accident, you should focus on recovering from the trauma rather than worrying about the financial consequences. To get through any such incident with as little stress as possible, you should always have enough car insurance and keep it in force.
The types of protection provided are referred to as insurance coverage. Along with the basic coverage provided by the policy, you can choose from a variety of add-ons to strengthen the insurance's protection.
Let us first go over the five different types of car insurance offered in India:
1. Third-Party Liability Only Cover
You will receive the following benefits under this sort of car insurance coverage:
- The cost of repairing or replacing a third-damaged party's vehicle
- The cost of hospitalization and third-party care
- Liabilities resulting from the death of third parties
Third-party car insurance coverage is required by the Motor Vehicles Act in order to drive on public roads. The sum assured should be appropriate for the driving conditions and sufficiently large to eliminate out-of-pocket expenses on your part.
2. Collision Damage or Own Damage (OD) Cover
When you choose collision damage auto insurance, the cost of repairing your damaged vehicle is covered. The premium for collision coverage is calculated by taking the vehicle's age and Insured Declared Value into account. The IDV is based on the vehicle's market value.
When a claim is filed under collision coverage insurance, the IDV less accrued depreciation determines the maximum amount payable under the policy. If you financed your vehicle, you should have collision coverage.
If you have collision coverage in your insurance policy, the insurance company will reimburse your car repair costs after the accident.
- In some circumstances, the cost of repairs will exceed the vehicle's current market worth. In such cases, the insurance company will pay the car's current market value.
- The collision coverage should be purchased in accordance with the age of your car. If you are purchasing insurance for a brand new vehicle, make sure that collision coverage is covered.
- If you have a lien on your vehicle, you should purchase collision insurance.
- For older cars, the collision coverage might be as little as possible.
3. Personal Accident Cover
Personal accident vehicle insurance coverage is used when you want to protect yourself, i.e., the owner-driver of the automobile, by selecting for reimbursement of medical bills following an accident.
In addition to the required liability insurance, you can include additional coverage to mitigate certain risk factors.
- Personal injury protection will cover all expenditures incurred as a result of the accident.
- Personal injury protection will pay the driver's and other passengers' medical expenditures.
- The insurance company will pay the medical bills regardless of who is to blame.
- As a result, you can get personal injury coverage for the vehicle owner, driver, and passengers to make the most of your investment.
4. Zero Depreciation Car Insurance
In India, this type of coverage is typically offered as an add-on to a car insurance policy. Assume your car has been damaged and you need to repair the parts. For claim settlement, the insurer will take the depreciated worth of the parts into account. A Zero Depreciation Car Insurance Coverage will ensure that you receive the whole claim amount without having to account for cost depreciation.
5. Comprehensive Car Insurance
This type of car insurance provides the most protection because it covers third-party liability, damage to one's own car, personal accident coverage, and all non-collision damage such as storms, floods, fire, and theft. A comprehensive car insurance coverage can be supplemented with a variety of add-ons.
A comprehensive insurance policy will cover all risks related to your car, driver, passengers, third-party vehicle, third-party driver, third-party vehicle passengers, and third-party property.
The following risk variables will also be covered by the insurance policy:
- Weather-related damage
The comprehensive coverage will cover a variety of issues that are not covered by the car collision. A comprehensive insurance policy can be purchased based on your financial situation.
You can reduce the insurance rate quoted by the insurance carrier by installing anti-theft devices and other security-enhancement technologies.
Car owners need to be knowledgeable enough to select the best car insurance coverage alternatives in order to limit risk while maximizing advantages. While mandated liability insurance is the least expensive alternative, it does not protect the policyholder's interests. As a result, the insurance policy should be chosen based on the type and model of the car, frequency of use, location, and other criteria. You can choose the finest vehicle insurance policy by comparing and studying various types of car insurance coverage.
Frequently Asked Questions
How many types of insurance are there for a car?
There are 5 types of car insurance available in India:
- Comprehensive car insurance
- Third-party car insurance
- Own Damage car insurance
- Zero Depreciation car insurance
- Personal accident cover
How to shop for a car insurance plan online?
You can easily buy a car insurance plan on Coverfox in simple steps. Just go to the Car Insurance page on Coverfox, fill in the necessary details of your car, choose a plan and get the policy emailed to you in no time.
Is it necessary to have a car insurance policy?
As per Motor Vehicles Act of India, it is compulsory for car owners and drivers to have at least third-party car insurance while driving their vehicle. However, you may choose from the types of car insurance plans that best suit your needs.