Areas To Critically Examine in Your Car Insurance Policy

When it comes to car insurance plans, there are many buyers who simply decide their purchase based on the cheapest premium. This, however, needs to be substituted by striking a balance between an affordable premium and policy feature. Not doing so often results in a case of under insurance or an insurance policy that isn’t the right fit.

Similar to buying a car, your car insurance policy must be given adequate importance. There are various aspects to consider, which you must keep in mind before deciding on one. If you are a first-time buyer or looking to have robust insurance cover, there are some areas to critically examine when buying car insurance online or offline.

  • Ensuring third-party coverage

Third-party car insurance is the minimum required insurance cover as per the Motor Vehicles Act. Hence, when buying an insurance plan, you must ensure it includes third-party coverage. This can either be bought as a standalone third-party liability cover or as a part of a comprehensive policy that includes third-party coverage.

Third party car insurance is essential since it safeguards you, the policyholder, against liabilities that may arise due to injuries or damage to a third person or their property. Thus, any bodily injury, disability, or even death of such a third person is covered by a third-party cover. In addition, damage to their property, by way of repairs required to their vehicle, is also covered up to ₹7.5 lakhs by the insurer. *

  • Choosing a comprehensive coverage

An alternative to a third-party policy is a comprehensive plan that not only provides protection for liabilities, but also coverage for repairs that may be required for your car. Thus, a comprehensive policy provides all-around protection against different forms of perils like natural disasters and man-made events. In addition to these features, a comprehensive policy can also be customized using the add-ons facility. *

  • Setting the right IDV

IDV, or insured declared value, is the amount that the insurer pays in the event of a total loss or damage beyond repair. However, you should not mistake it for the resale value of your car. As IDV is the amount for which the insurer compensates, it is the risk that the insurer needs to undertake. Hence, IDV has a direct impact on the premium calculation. Generally, insurance companies determine the IDV based on the age of the vehicle. However, you can increase or decrease such an IDV within a specified range. Altering the IDV impacts the compensation that is paid by your insurer and, hence, must be set right.

  • Ensuring the right set of policy features

Often, most buyers simply buy a policy with the cheapest premium rate. While that shouldn’t be the only factor to consider. You must also keep in mind the features your insurance cover includes. A reputed insurance company will offer continuous support even after buying the insurance plan and address all your queries. These additional features in your insurance policy can be a make or break decision when the time comes.

  • Facility for optional covers

As discussed above, comprehensive plans provide add-on coverage that helps customize your policy coverage. Things that are otherwise excluded from a standard car insurance policy can be secured using add-on covers. Hence, it is essential to look for the facility to choose different add-on covers.

Keep a lookout for these essential pointers at the time of purchase or car insurance renewal. They can help in availing not only a robust insurance coverage, but also ensuring it does not bleed your bank account at the time of an insurance claim.

Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms and conditions, please read sales brochure/policy wording carefully before concluding a sale.

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