Simple Ways to Choose the Best Car Insurance Policy

Comparison of quotes is one of the best ways to get the best car insurance deals. You need to compare quotes of multiple insurance providers.

Here are some tips to choose the best car insurance policy:

Buying a motor insurance in India is tough especially if you don’t know how to choose the best and one that fits into your requirements. Most owners with car under five years old will get calls from pushy salesman trying to sell their product.

However, it is crucial that you pick one carefully. Always go through fine print. Do not finalize on one without comparing quotes from multiple insurance providers. This will help you know who is offering you the best deal.

Here is a checklist to ensure making the most out of car insurance policy:

Types of Motor Insurance

Usually plans offered by general insurance providers are classified under two major categories:

1. Third Party Liability Insurance

It generally covers injury to third party, damage to property, and accidental death. The plan is a mandatory requirement in India for all vehicles to be driven on public roads.

2. Comprehensive Plan

The plan is also a preferred option for many car owners in India because it offers cover for legal liability of third party and ‘own damage’. It covers damage or theft caused due to unforeseen dangers such as fire explosion, earthquake, cyclone, etc.

Factors Influencing Vehicle Insurance Premium

These are actually based on factors affecting calculation of on the insurance company risks. The factors may be grouped under the following categories:
The premium for car insurance is usually determined by a number of parameters such as cubic capacity, make, and fuel type. Some of the vehicles like commercial vehicles and SUV usually require higher premium payouts because insurance companies get huge number of claims on them.
The company will also consider the following:
Location Related Risks – The factor is dependent on registration area. For urban areas, the premiums are high. Premiums will also get higher at theft prone areas.
History Related Claims – Premiums will go up for each claim for your vehicle.
Driver Risks – It is important to take into account the age and profession of the driver. The premium will certainly go up for multiple drivers.

Addons for Increasing Premium Yet Immensely Useful

When finalizing on a car insurance plan, it is crucial that you look for add-ons offered. These addons will increase premium yet very useful for you as a car owner. Here are some of the best addons offered by insurance companies, these days:

a) Nil-Depreciation Insurance

This policy will cover you for full claim for car’s plastic and rubber parts. Usually an insurance firm will pay just 50% of value for these parts (subjected to wear and tear). Most cars in India have plastic and rubber parts. Hence, it is worthwhile to avail nil depreciation plans even if it means increasing premium. In the event of a claim, it may knock good amount in repair bill.

b) Personnel Cover

A standard comprehensive insurance cover will embrace personal accident cover for car owner. It is also possible to cover additional users with valid driving license and using car for a nominal fee. Most companies include the cover in their comprehensive motor insurance plans.

Don’t Go Wrong

Did you know there are many areas where buyers might go wrong when choosing a cover? Here’s what you need to consider:

a) Car Value

In order buy a policy with a lower premium payout, often people reduce the IDV or ‘insured declared value’ of the car. But in case of an accident the car will be treated as total write off. Avoid such practice as the benefit for the cost is not adequate. Always try and choose a policy that offers you the maximum IDV on your vehicle, even if it means a slightly higher premium.

b) Policy Lapse

A grace period of around a week is offered by insurance company in case of a policy lapse. After this period you might be under the risk of driving car sans insurance. You might also lose various benefits such as special discounts and lower premiums.

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