Insurance is a tool by which a collective fund is used to mitigate the loss of individuals.
Car insurance pays for repairs or damages caused to your car in the event of an accident, flood or theft. It also pays for any damage caused by you to any public or private property or people.
Car insurance ensures you don’t have to use your savings when your car has to be repaired for damages caused due to an accident and pays for the damages caused by you to other people or property.
The two basic types of car insurance available in India is One, which gives you complete protection called Comprehensive Insurance. This pays for your own repair expenses as well as for repair expenses you owe to a third party. Second one, called the Liability only policy covers only the repair expenses you owe to a third party. It does not pay you anything for repairing you own car. Govt of India, as per the Motor Vehicles Act 1988, mandates that any car plying on the road should at least have the Liability only insurance cover.
The following are covered under the basic comprehensive car insurance policy a. Fire, explosion, self-ignition or lightning b. Burglary, housebreaking or theft c. Riot or strike d. Earthquake (fire and shock damage) e. Flood typhoon, hurricane, storm, tempest, inundation, cyclone, hailstorm, frost f. Accidental external means g. Malicious act h. Terrorist activity i. Whilst in transit by road, rail, inland- waterway, lift, elevator or air j. Land slide, rock slide
A policy period is by standard 1 year. You can only buy 1 year policies online. However, under certain circumstances insurance companies also issue policies for less than 1 year, but they cannot be bought online.
Insured Declared Value (IDV) is a technical insurance term. In plain language it means the current value of your car. On an average, there will be a 10% depreciation on the value of your car every year. If you bought a car worth 10 Lacs 3 years ago, the current value of the car after a 10% depreciation for 3 years will be about 7 to 7.5 Lacs.
Each insurance company have their own way of calculating the premiums. The basic factors based on which the premium is calculated are the following - a.Insured's Declared Value (IDV) b.Cubic Capacity (CC) of the vehicle c.Age of the vehicle d.Make and Model of your car e.The location where you car is registered (RTO)
Any additional accessories which are not part of the standard fitments by the car manufacturer can be classified as a electrical and non electrical accessories. Example for electrical accessories are - Additional music system, additional speakers, subwoofers, LCD display etc. Example for non-eclectic accessories are - Additional spoilers, Stepney wheel casing, additional seat covers etc.
There are 3 Personal Accident Covers that can come bundled in your Car Insurance Policy. PA to Owner Driver - This is compulsory and is by default present in your any kind of car insurance you buy. The additional premium deducted from you for this PA cover is INR 100 and you get benefit upto 2 Lacs. PA to Unnamed Passengers - This is an optional cover. It covers the passengers in your car. You can opt for this cover by choosing a nominal additional premium. The options available are - INR 25 (for 50K cover), INR 50 (for 1Lac cover), INR 100 (for 2 Lac cover). PA to Paid Driver - This is compulsory if you are using a driver. It is also called the Legal Liability (LL) to paid Driver. The additional premium to be paid is INR 50 for a cover of 1 Lac.
Some of the situations compensated by the presence of a PA policy are - Death, Permanent Total Disability (PTD), Permanent Partial Disability (PPD), Temporary Partial Disability (TPD) etc, occurred due to a Car Accident. However, the extend of PA cover varies between Insurance companies. Refer your policy document to know the exact inclusions and exclusions.
Its always a good practise to renew your car insurance policy before it expires. Once your policy expires, you insurance ceases to exist and you are exposed to the risk of paying money from your own pocket it there is any accident. The insurance company may also demand that they need to do an inspection on your vehicle before they re-issue an insurance policy for your car. Though we can help you reduce the hassles, in general, it is advisable to always renew your policy before its expiry date.
We are around to help you renew your policy if its already expired. We have simplified the process and you can get a new policy in as quick as 4 hours. Just call us on the number you see on the top right hand corner of your screen.
There is belief that if you renew your car insurance policy before the expiry date, your new policy will be effective from the day you buy your new policy. This is a wrong belief. If your policy expiry date is 20th of a month and if you renew your car insurance policy on 10th, the new policy will be effective from 21st only. It will not be effective from 10th. The start date of the policy and the end date of the policy will be clearly mentioned in the policy document.
You can renew your car insurance policy as early as 60 days before your policy expiry date. But if you renew your policy 60 days in advance and if there is a a claim that comes up in those 60 days, then you may have to pay extra premium. So it is always recommended that you renew your policy anytime between 30 days to 10 days before the policy expiry date so that you renew your car insurance policy paying the correct premiums.
Anytime, irrespective of how old your car is, its always advisable to take a comprehensive car insurance. For an old car, the cost of insurance is pretty low as well! Though you may not get the complete claim settlement, you can always get upto 40-50% of claim amount settled by the insurance company. Thus you are reaping considerable amount of benefits compared to the small premium you have to pay for the insurance.
No Claims Bonus is a discount offered on the car insurance premium for driving safe and not raising a claim. For every consecutive claim free year, there is a percentage of No Claim Bonus (NCB) which the insurance company offers. If you accumulated your NCB over 3 years, and in the 4th year if you had a claim, then NCB gets reset to 0% again and you have to start accumulating your NCB again. The NCB grid for every consecutive no claims years as below - First year - 0% Second year - 20% Third year - 25% Fourth year - 35% Fifth year - 40% Sixth year and above - 50%
You can either offer your policy to be transferred to the name of the new buyer, or ask the buyer to buy a new policy for himself. In the first case, the new owner can approach your insurance company and request for a name transfer by providing the required documents and by paying additional premium if any required. He can enjoy the same policy till the expiry date of the original policy. In the second case, where the new owner is buying his own new policy and not transferring you insurance policy, you can approach the insurance company for cancellation of your policy. The insurance company will provide a refund on a pro-rated basis depending on the number of months remaining in your policy. Please note that the third party liability premium is not refunded. The pro-rata refund will only be on the own-damage premium.
If you have a claim, you can call us on our helpdesk number on the top right hand corner of your screen and we will assist you end to end in your claim settlement. If you decide to process your claim by yourself the following are the broad procedure – 1) Register your claim with the insurance company as soon as the accident has occurred. Insurance company may also assist you in locating a workshop near your location. 2) If there is damage only to your vehicle, take your car to the nearest workshop 3) Insurance company will appoint a surveyor to assess the losses to your car 4) The insurance company on the basis of the surveyor report promised to pay appropriate amount towards repairs. 5) Upon confirmation from the insurance company, the workshop starts work. 6) Once the repair works are completed, the surveyor once again verifies that all the work has been completed and the vehicle is the right condition to be released to the owner. 7) If it’s a cashless settlement, the insurance company pays the settlement directly to the workshop and they release the car to the owner 8) If it’s a reimbursement settlement, the owner has to settle the bill at the workshop and the owner will get the reimbursement from the insurance company. Ideally within a week’s time. 9) If a third party is involved in the accident, an FIR has to be filed at the nearest police station.
Discounts are an intrinsic part of your car insurance policy. There are different types of discounts. First, the discount you earn due to your good driving skills. It is called No Claim Bonus (NCB). NCB is a discount you get on your Own-Damage premium. NCB varies from 0% to 50% depending on your claim history. Second type is the discounts provided by the insurance company based on the overall claims experience the particular insurance company is facing for a particular make-model-variant. If the claims for a particular car make-model is low, then the Insurance company offers a higher discount for that model, compared to other models. This discount can vary from 10% to 65% on the own-damage premium. Third type of discounts are the ones you get due to your age, occupation, automobile association memberships, anti-theft device installation etc. Some of these are offered by some insurance companies and cannot be considered as a major source of discount compared to the NCB and the Insurance company provided discounts. Last type of discount are called Voluntary Deductible discount. You can agree to pay a certain amount of the claim upto a limit by yourself without requesting the settlement from the insurance company. For example, if the claim amount is 20,000 INR and you have agreed for a voluntary deductible of 5,000 INR. Then the insurance company pays you only upto 15,000 INR for the claim. The first 5,000 will have to be paid by you. This is not a recommended discount mechanism because to save a few hundreds in the premium, you end up paying a lot more during every claim. Now you know why the premiums from different insurance companies are different for the same car.
This is the most asked question by anyone who have had a claims experience. The reason for the entire claims amount not being settled by the insurance company has a very logical explanation. A basic comprehensive policy come with the standard depreciation clause. The moment you start using your car, there is a depreciation for each part in your car. In some cases if the car meets with an accident, and a particular part has to be changed, then the damaged part is replaced by a new part. However, the insurance company does not pay for the full cost of the part, because you have have used it for sometime before it got damaged and hence a depreciation will be applied. There is a depreciation chart which all Insurance companies follow for calculating the depreciation on each and every part of your car. There are things like nuts, bolts, oil, etc. which will be consumed during the repair process. This is not covered by your insurance policy and you will end up paying for this. During every claim, the govt has mandated something called the compulsory deductible. This is typically around 1000 INR for a less than 1500CC vehicle and 2000 INR for more than 1500 CC vehicle. This means, for every claim the first 1000 INR or 2000 INR has to be borne by the insurer. Only the rest will be paid by the insurance company. There are other exclusions in your policy due to which certain claims will not be paid. Refer the policy document to know more about the various inclusions and exclusions. Tip: You can get the insurance company to ignore the depreciation and pay you the full amount of the claim. People normally call it the Bumper to Bumper Policy. Technically, it is an add-on which can be purchased along with your insurance policy by paying an additional premium. The add-on is called Zero Depreciation or Nil Depreciation in the Insurance Terms.
Add-ons, at a small additional premium provides a lot of additional security to your car. There are a lot of add-ons offered by different Insurance Companies. But some interesting and must have add-ons are - Bumper to Bumper : Technically known as “Zero Depreciation”. When your car meets with an accident, this add-on pays for the replacement of the damaged parts in full. If you don’t have this add-on, you will have to pay about 30% to 50% of the claim from your pocket. Engine Protect : Your standard car insurance covers damages to your car due to an accident, but not your engine. This add-on will pay for engine repairs if water enters your engine (due to flood, etc.), oil leakage or damages due to an accident. NCB Protect : Each year that you do not make a claim, you get a discount called NCB (No Claim Bonus) during renewal. This add-on will preserve your accumulated NCB, even if you make a claim. Road Side Assistance (RSA) : In the event of a breakdown on the road, this add-on arranges for towing, change of flat tyre, mechanics services or even alternate transport. Return to Invoice (RTI) : In the event of a total loss or theft of your car, this add-on pays the registration and road tax that you have paid, along the market value of your car. Whereas, a basic policy will not pay for your road tax and registration expenses.
You are still eligible for NCB if you renew your policy within 90 days of expiry of previous policy. After 90 days you will lose your NCB.
It is always recommended to choose the optimum IDV as suggested by the us while Insuring your car. The insurance company pays only upto the IDV amount in case of a Total Loss or a Theft. So it is not recommended to choose a low IDV.