Car insurance is necessary if you purchase a new car or if you are an owner of an old car. It will protect your vehicle in the event of an accident, theft and also cover your financial expenses in case you injure or damage a third party. You can purchase your car insurance online as well as through an offline method. However, choosing and purchasing car insurance online is a smooth and hassle-free experience.
You should remember that car insurance acts as a financial safety net for you and your car. Moreover, as per the Motor Vehicle Act 1988, having car insurance is mandatory if you want to drive your vehicle on Indian roads. Thus, acquiring the same will also save you from legal obligations. To find the finest option, you must examine an insurance company's claim history and market reputation before selecting one.
Why Is Car Insurance Necessary?
Car insurance is actually important. It gives financial and legal security to you in case of an accident or theft. The following are the benefits that you will get while buying car insurance online as well as offline:
1. Security
A car insurance policy protects your car since it covers any damage faced in a road accident. You can visit a network garage to receive cashless car repairs, or the insurance provider will reimburse the cost of the repairs.
2. Shield Against Legal Complications
Every owner of an automobile in India is obligated under the Motor Vehicle Act of 1988 to acquire auto insurance in order to operate a vehicle on Indian roads lawfully. If you don't have your car insured, you'll have to pay hefty penalties or face imprisonment, or both. Therefore, you must obtain automobile insurance to avoid these issues.
3. Coverage f or Third-Party Liability
If your car causes damage to a third party, person or property, you will not have to pay for it out of pocket because your insurance provider will cover the damages.
4. Personal Accident Reimbursement
A car insurance policy is useful not only for protecting the automobile but also for safeguarding the owner in the case of an accident or injury. Your insurer will pay for your treatment, which will reduce your financial load.
Types of Car Insurance
Below are the different types of car insurances which you must be aware of as it will assist you in making the right choice.
1. Third-Party Car Insurance
A third-party auto insurance coverage offers you financial security against any harm or losses you could inadvertently cause to another individual using your vehicle. Anyone who owns or operates a car in India is required to have third-party auto insurance under the provisions of the Motor Vehicles Act of 1988. If you don't, you risk paying huge fines. The authorities may even file a lawsuit against the person if required. If you are purchasing this car insurance online, you should look for the best deal for yourself.
2. Comprehensive Car Insurance
Comprehensive car insurance protects your vehicle against theft, accidents, and natural disasters. This insurance coverage will be your saviour in the event of an unanticipated misfortune that results in loss or damage to you or your vehicle. It is one of the best vehicle insurance plans since it covers third-party obligations and provides financial security to your car. However, this insurance plan is more expensive than a third-party policy due to its wide protection. You can go through various insurance companies and compare their offers before you purchase this car insurance online or offline.
3. Stand Alone Own Damage Cover
This insurance coverage is intended to safeguard your car from unexpected damage. This policy covers damages caused to your vehicle as a consequence of natural catastrophes, fires, traffic accidents, or other unfortunate incidents. Its purpose is to give you extra protection beyond third-party liability.
Factors Affecting Car Insurance Premium
When you purchase a car insurance online or offline, there are certain factors that influence your car insurance premium. Below are the details about the same:
1. Age of the Car
Your automobile's age has an impact on your insurance costs since it influences how much your car’s value has depreciated. The car's Insured Declared Value, or IDV, is calculated using the car depreciation rate and current market value.
2. Make & Model of Vehicle
The car's brand, model, and variant also affect the cost of auto insurance, despite the fact that this may not seem probable. Considerations include things like engine size, vehicle type, manufacturer, etc.
3. Type of Plan
Your choice of coverage will significantly affect the cost of your auto insurance. The costs are a little bit more for comprehensive automobile insurance because it covers both personal damage and third-party damage. If you purchase your car insurance online, you can easily compare the cost difference between various plans.
4. Geographical Area
If you live in a vandal-prone region, you may have to pay a higher premium since a car parked in an unsafe area is more likely to be damaged or stolen.
5. No Claim Bonu s
Insurance companies often give you a No Claim Bonus, or NCB, on your renewal payment if you have a claim-free policy year. This award increases by 50% for each following claim-free year. As a result, NCB in auto insurance can have a significant influence on the rate.
6. Add-on Covers
Add-on covers are a fantastic way to boost your insurance and are reasonably priced. As a result, the more add-on coverage you choose, the more your auto insurance policy price will be.
Is Car Insurance Required If Someone Borrows My Vehicle?
Yes, automobile insurance is required if someone uses your vehicle. Usually, automobile insurance coverage accompanies the car being insured. So, if you give your automobile to a friend, your auto insurance will normally cover the majority of claims that may arise while that person is driving your car.
Should I Opt for an Umbrella Insurance Policy?
Before determining whether or if an umbrella insurance coverage is necessary, you must first understand what this insurance entails.
Umbrella insurance provides additional liability coverage in supplementary to the protection offered by your automobile policy. It's for high-cost scenarios where medical expenses and/or repairs surpass the limits of your basic vehicle policy. You may consider it asset protection since it can shield you from squandering your assets to compensate for a lawsuit against you.
For example, you cause a vehicle accident that results in numerous individuals suffering serious injuries. Their medical expenses total ₹4,00,000, which exceeds the ₹3,00,000 liability limitations on your automobile insurance policy. In that scenario, the remaining ₹1,00,000 can be covered by your umbrella insurance. Thus, it’s important to have an umbrella insurance policy as it will be your saviour in these forms of situations.
FAQs
1. Is it mandatory to have a car insurance policy?
Yes, as per the Motor Vehicle Act 1988, you must have a third-party car insurance policy in order to drive your car legally in India.
2. How to choose the best car insurance policy?
Several insurance companies are available in the market. In order to choose the best, you must compare the prices and coverages provided by them. Making comparisons becomes easier if you are purchasing car insurance online.
3. What are the documents required for filing a claim?
Whether you have purchase your car insurance online or offline, below is the list of documents that are required for filing a claim:
· Insurance policy documents
· Details of your vehicle
· Details of the insured person
· Details about the accident
· Copy of FIR in the event of theft
· Original receipts determining the repair of the vehicle
