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Are you trying to get your queries on car insurance solved? You have arrived at the right page. Coverfox helps you uncover some of the most commonly asked questions on car insurance.
If I fit CNG or LPG kit in my car, is it necessary to inform the Insurance Company?
As you fit the CNG / LPG kit, it is necessary to inform both the Road Transport Authority (RTA) where the vehicle is registered and your Insurance Company. The RTA will make a note of the change in the Registration Certificate (RC), and the Insurance Company will inform you about the payment of extra premium for the value of the kit to be covered under the “OD” and “TP” sections. The fitting of the CNG should be endorsed in the RC barring, which an insurance claim would be considered as void.
What are the documents that are required to be submitted for a Car Insurance claim?
The policy document is a ready reckoner that you can refer for the complete list of documents to be submitted if you have a Car
Insurance claim. The documents which you would generally require are:
If you are availing the cashless facility then only the repair invoice would be required. For theft claims, you would need to file an FIR with the local policy and the copy of the same needs to be submitted to the insurance company along with the keys of your vehicle and a non-traceable certificate.
How is the premium of car insurance determined?
The premium for your car insurance is calculated on different factors for the Own Damage cover (Comprehensive cover) and the Third party cover.
The Own Damage cover Premium is calculated basis the following:
The Third party cover shields you from loss or injury you cause to a third-party (the calculation is based on the engine capacity). You may also apply for the Personal Accident cover, which will protect you from accidents. The premium amount would have the PA cover and service charges would be reflected in it.
What's not included in your Car Insurance Cover?
A third party liabilty insurance cover is clearly limited. But there are some scenarios where even a comprehensive car insurance policy with add-ons can't help:
What is comprehensive car insurance?
A comprehensive car insurance will cover your car from instances of theft, fire and vandalism. It also protects from natural disasters such as cyclone, floods, earthquakes, or from civil disturbances such as riots, which damages your car. A list of what perils are covered will be provided in the policy document. Make sure you go through the list to understand the protection being offered. Along with this, it also covers any legal liability arising due to the damages caused to any third party triggered by your car.
What is third party car insurance?
The third party car insurance only covers your legal liability for any loss and damages to third party because of your car. It will not cover you or your car for any damages suffered.
What is covered under comprehensive car insurance cover?
A comprehensive car insurance will cover your car from damages, which are caused from perils apart from collision. The comprehensive plan covers damage/losses to your car as well as third party.
What is a voluntary deductible?
A deductible is a part of the monetary loss which you decide to bear in case of a claim. While the compulsory deductible is pre-set by the IRDA, you can choose to opt for a voluntary deductible based on your capacity of bearing the claim amount. The higher you opt for a voluntary deductible, lower will be your premiums.
Does my city have an impact on the premium paid?
Yes, it does. The location at where you reside can affect the premium. If your locality is prone to robberies, theft, burglary then the motor insurance premium will be higher than the localities where the instances of theft are less. The metro cities in India usually have higher premium than non-metro cities, you will find that cities are usually divided into zones for insurance purposes normally it is metro cities and the rest of India.
What is the procedure for endorsement of existing car insurance policy?
You may wish to make changes to your existing car insurance policy, and these changes are done through an endorsement. An endorsement is a written evidence of the changes made in the policy. If you need to make any changes then you can submit a letter to the insurer with the necessary proofs. This helps you obtain an endorsement, which can affect the premium to be paid for the policy.
What car insurance cover should I buy? Should I buy Comprehensive Insurance or Third Party Liability Insurance?
The Third Party Liability is also called as Liability Only or Act Only, and is mandatory by law for all vehicles plying the roads in India. The Liability Only covers the legal liability of the third party against damages to the property or any injury/death caused by your car. The policy type does not cover you or your vehicle. Hence, it is apt to go for the Comprehensive Insurance policy which will cover the ‘Liability’ and ‘Own Damage’.
What are the recommended add-on covers in car insurance?
The add-on covers are meant to support car insurance plans adequately. Some of the add-on covers are zero-depreciation, invoice cover, engine and electronic circuit cover and No Claim Bonus Protector cover. A zero depreciation cover ensures that the insured can have a full claim on the value of the parts without deductions for standard depreciation that are replaced after an accident. The invoice cover ensures that you will be reimbursed the ‘on road price’ in case the car gets stolen or has a total loss due to a major accident. The engine and electronic circuit cover offers protection during flooding. The No Claim Bonus cover helps you retain the NCB benefit even after one claim has been made during the year.
What is the period of the policy in a car insurance policy?
A policy period is the duration during which the policy is effective. The policy period starts on a particular day, which is defined on the purchase of the policy and. It is valid for one year or a period of three years depending on the insurance plan selected by the insured.
Can I cancel car insurance anytime?
Yes, the policy can be cancelled and the unused premium amount refunded usually on a pro-rata basis. This will happen only if an alternate insurance proof is offered, and claims aren’t raised subject to 30 days prior to the policy expiry date. If a claim is raised, refund shall not be made. There could also be a nominal cancellation, which is charged.
What is depreciation in car insurance?
Depreciation in car insurance refers to loss of value due to wear and tear of the vehicle. The rate of depreciation is significant from the time you buy the car insurance policy. It is applicable to each car part except glass. The rate of depreciation is 50% for rubber, plastic parts, tyres and tubes, batteries and air bags; while a 30% for all fibre components.
What is cover note provided by my insurer? And how will it help me?
A cover note is an interim document, which is issued by the insurer until a final insurance policy can be provided. The cover note will have the name of the insured, the insurer and details of the coverage. A cover note is usually valid for a period of 60 days and the insurer issues the Certificate of Insurance before the expiry of the cover note. It enables the purchaser to cancel the policy, and receive a refund on the condition that a claim is not yet made.
Can the No Claim Bonus on my expired car insurance be transferred?
Yes, it is possible to transfer the No Claim Bonus (NCB), which is accrued to the new insurance policy even after expiry. This is possible within 90 days from the expiry of the car insurance, the NCB benefits post this period is not transferable. Within 90 days the amount and discounts earned are all transferred to the new policy.
What are the discounts that can lower the premium?
The premium can be lowered by availing the No Claim Bonus (NCB). There are more discounts which can be availed under the Own Damage premium for membership of Automobile Association of India, Vintage Cars (Private cars certified by the Vintage and Classic Car Club of India) and installation of anti-theft devices approved by the ARAI (Automobile Research Association of India), Pune. There are also concessions for modified vehicles for the blind, handicapped and mentally challenged persons that is endorsed in the RC by the RTA.
Can the insurance continue to be in the name of the previous owner whereas the vehicle is transferred in RTO records in my name?
No, this is not advisable. The registration and insurance of the vehicle should be in the same name and same address otherwise the claim might get denied. So a fresh proposal can be filed and with the payment of a nominal fee so that you can initiate the transfer of the insurance.
What is salvage and total loss?
The value of wreck when a vehicle meets with an accident where the vehicle is damaged is considered as salvage. Whereas when the retrieval of the damaged vehicle to its initial condition is not possible is considered as total loss.
What is a cashless claim and reimbursement claim?
A cashless claim is the complete responsibility of the insurance company. Most of the companies have their own garage network, which can repair the damaged vehicles. The owner does not have to worry about the expenses apart from the consumables (not covered in the policy). The payment of only the difference amount as confirmed during the process of the claim needs to be made.
If you decide to choose your own garage for repair works (not a part of the insurer’s garage network), then you can claim reimbursement for the same. You will need to submit the original bills, payment receipts to the insurance company after you settle the repair amount from your own pocket
What documents are required to avail the cashless facility?
The documents which are required to make the claim are:
You will need to read the policy document to check the documents required apart from the ones which are listed.
What is a certificate of insurance?
The certificate of insurance is a document which provides information on the specific insurance coverage issued by the insurance company as per the Rule 141 of Central Motor Vehicles Rules 1989, and only in Form 51. The document offers information on the effective policy date, type of the insurance coverage. This document should always be carried in the vehicle.
What are the documents required to be kept in the vehicle while plying public places?
The documents which you need to keep in the vehicle while plying public places are the Certificate of Insurance, a copy of the Registration Certificate, the PUC (Pollution Under Control) certificate, and the Xerox copy of the driving licence of the person who is driving the vehicle.
How is car insurance calculated?
A valid car Insurance is mandatory by law for all cars running on Indian roads. There are mainly two types of car insurance in India offered by general insurance companies in India. They are- third party insurance and comprehensive insurance.
Third party insurance covers for damage and liabilities of the third party only arising out of a collision. It is the most basic and cheapest form of car insurance to get. Comprehensive insurance covers for damages for the insured vehicle and also the liability of the third party arising from the accident.
Car insurance premium calculation is done primarily on the basis of Insured Declared Value (IDV) of the specific model. The IDV is calculated on the ex-showroom price of the car and it changes annually as per the depreciation rate of a certain model. The other factors affecting car insurance premium include no claim bonus which is rewarded to the insured for not making any claims during the policy term. No Claim Bonus(NCB) can be accumulated to a staggering 50% on the premium amount. Discount on car insurance can be availed if the car owner has installed an anti-theft device approved by ARAI (Automobile Research Association of India) or opts for a voluntary deductible.
All the above factors affect the final calculation of the car insurance premium payable.