Reasons to Purchase A Car Insurance
Considering
the bumper to bumper traffic situation in most Indian cities, owning a 4-wheeler
is not only about its joy anymore. When buying a vehicle, we tend to focus on its
fuel mileage, engine specs, design, price etc. What we often miss out is the insurance
and safety component for the car. No doubt a car insurance is one of the most
important considerations for your car. Not having an insurance is a whole different
ballgame when you try to maintain and retain your car’s new condition. Its time
you explore the basic benefits of a car insurance.
Car Insurance has these
components:
1.
Own Damage -
Damage to your own vehicle. (Optional)
2.
Third Party/
Liability Cover - Damage to another property/person by your vehicle
(compulsory).
The Motor Vehicle Act 1988, states that a
third-party coverage is important and compulsory for all vehicles that drive on
roads in India and you can also be penalised by authorities, if you fail to do
so. The component of own damage is not compulsory, but recommended amongst the basic benefits of a car insurance.
You don’t need to buy separate policies for both coverages
as Only Third-Party policy is sold individually, Comprehensive/Package policy
includes both coverages.
The practise in not followed in India as both persons
claim from their respective companies and moreover, you need to fix
responsibility of one person if there has been an accident. Damages for Third
party property are covered up to Rs. 7.5 lacs in India.
There are so many reasons why one should
avail the basic benefits of a car insurance active protection for your vehicle and
your own body when driving in India.
5 reasons
to receive the basic benefits of a car insurance
Although the procedure for buying a car in
the India is simple, especially disposable incomes rising on the horizon, most
working people can buy more than one car. A car enhances one’s mobility and
eliminates dependence on public transport.
Yet, driving on the road brings its own set
of risks. Often, we have heard people suffering from rash accident, and various
other problems present in the traffic scenario, which makes owning a car quite
risky. Instances of road accidents and indiscipline are visible in the news
media on a daily basis. Keeping these factors in mind, understand the basic benefits of a car insurance.
1.
Damages
Remember that while cars are expensive in the first place, costs of repairs are not cheap either. Often times, you or your vehicle may get damaged due to another people’s fault. It could be a car crashing with yours, or you losing control against a jaywalker, and crashing into another vehicle, or maybe your windshield could get cracked from a hail storm. All of these can cost you a lot of money, unless you are receiving the basic benefits of a car insurance.
2.
Lessens
Liability
In India, it is compulsory to buy a Third Party Liability car insurance. This policy covers your vehicle against the legal fall backs of accidents caused by you. For instance, if you cause an accident that delivers damage or injuries to another person, then the insurance cover will deal with treatment as well as the legal ramifications.
3.
Costs
less when purchased online
Online purchase of insurance policies means that you have to deal with lower premiums and a policy that costs less. Operating over the internet means that the operating costs are less and that they are passed as the component of money that is saved on the payment of commission towards the middleman or towards the customer, enhancing the basic benefits of a car insurance that you get. Purchasing motor insurance online has various other advantages too, such as faster renewal and payment of premium with no paperwork.
4.
Compensation
for your family
In an un-fateful situation, the car owner may
lose his/her life. The bread earner having died, the family members can sustain
by availing the basic benefits of a car insurance.
5. To Satisfy Loan Requirement
In a situation, when your vehicle is on lease
or financed, the credit company may want you to buy a collision coverage together with
a comprehensive coverage. Considering
that the lender is a lienholder of
your vehicle until your payments are complete, these two coverages will act as
a protection of their investment. A collision or comprehensive cover will you
help fund the repair or replacement of the loss.
WATCH OUT FOR
1. IDV: Your Insurer may reduce the premium you pay by reducing this amount. Remember, this is the amount that you get in case of total loss.
2. Excess: In case of an accident, if you choose to pay for the first INR 5000, then this figure may be lessened from your premium. But ensure that your agent informs you about this.
3. Bonus on No Claims: When you do not make any claims, you are eligible for a no claim bonus. This no-claim bonus can be utilised for reducing your future premiums and accrued over the years. Hence, ensure that you do not make unnecessary claims i.e. claims for very small and nominal amounts. Accrual of this no claim bonus can provide higher benefits on future renewals.
4.Cover notes: Cover notes stay
valid for the first 2 months, post this, you will get the final policy paper. In
case you have not received the cover notes, you may not be insured at all. So,
make sure you have a cover paper.
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