Car Insurance

Car Insurance is a type of motor insurance policy that protects a car from any unavoidable dangers that may lead to monetary losses. It is a risk-sharing contract between the motor insurance company and the car owner where the former promises to pay for the repairs/ replacement of the car in exchange for a premium. A car insurance policy provides coverage against any risks or dangers arising out of accidents, third party liabilities, theft, manmade calamities, fire, natural hazards, etc. resulting in damages or loss of the car.

Why Should You Buy Car Insurance Policy?

Buying a Car Insurance Policy is mandatory in India as per the Motor Vehicle Act 1988. Car insurance companies compensate for the loss or damage caused to the insured vehicle and a third-party from the insured four-wheeler. Here are some of the reasons to buy new car insurance policy in India:

• It pays for the car damages as a result of collision, accident, death or natural calamities, which otherwise would need to be paid by the insured
• It pays for hospitalization expenses in case of an accident
• It reduces the financial and legal damages that can arise from a third-party laibility or damage
• With rider benefits like roadside assistance, zero depreciation the expenses are further reduced

Moreover, the premium amount of your car insurance is decided based on the Insured Declared Value or IDV of the vehicle. If you increase the IDV, the premium rises and if you lower it, the premium reduces.

It is important for any policyholder to compare car insurance plans before going for 4-wheeler insurance renewal or buying a new policy. Compare various car insurance plans online on Policybazaar and buy the one that fulfils your expectations hassle-free:

• Get the best car insurance policy from top Car insurers
• Instant and easy online car insurance renewal process
• Comprehensive coverage for four-wheeler vehicle
• A wide range of Add-on covers for improved protection

Types of Car Insurance Policy in India

There are 3 types of car insurance policy that are available in India –

• Comprehensive Car Insurance

  A comprehensive car insurance policy provides coverage for third party liability as well as damages caused to your own car. In comparison with third party liability car insurance, a comprehensive four wheeler insurance policy offers extensive coverage, more benefits and covers the damages caused to the insured car in case of an accident, collision, theft, etc.

  A comprehensive policy can be further extended by opting for add-ons like accessories cover, engine protector, zero depreciation cover, medical expenses, etc. This type of coverage is the most popular as it offers end-to-end coverage and thus less stress for the policyholder.

• Third Party Car Insurance

  Third party car insurance safeguards you from any legal liability due to your own car’s involvement in an accident. Your insurance provider will compensate you for death, disability, injury, or property damage to any third-party. Therefore, you are protected from the financial liability towards the third-party.

  Third-party Liability Car Insurance price is a mandate in India under the Motor Vehicles Act, 1988.

  Engine Capacity	Third-party Liability Car Insurance Price Effective June 16, 2019 (Rs.)
  Less than 1000 CC	2,072
  More than 1000 CC & less than 1500 CC	3,221
  More than 1500 CC	7,890

• Pay as You Drive Insurance

  Also known as usage-based motor insurance, this insurance policy allows the insured to pay the insurance premiums as per the kilometers driven. This newly introduced product likely to be helpful for those with multiple cars not all of which are used so frequently. As per the IRDA guidelines under the Sandbox project, a few insurers such as Bharti AXA, Bajaj Allianz have started offering Pay As You Drive insurance policy. The policy offers comprehensive coverage for own damage and third-party liability on a pilot basis for a term of one year. The policy seeker will have to declare the distance he/she expects to travel during a policy year and based on that premiums for Pay As You Drive policy will be decided. However, the insurers have come up with 3 slabs for distance covered -Rs 2,500 km, 5,000 km and 7,500 km.

Best Car Insurance Policy in India 2020

The following table shows the complete list of the best car insurance policy in India with their personal accident cover and the number of network garages offered by the Car Insurers:

Benefits of Car Insurance Policy

It is not only because of the law but for the benefit of your vehicle, it is good to get it insured. Whether you purchase a new car or old second-hand vehicle, its insurance is needed always. A third-party car insurance policy provides protection against liabilities (legal and financial) towards a third-party.

However, you can buy a comprehensive cover as well that not only provides third-party coverage but protects your vehicle against damage or loss. Here are a few benefits of having a car insurance policy:

• Personal Accident Cover: A comprehensive car insurance policy not only provides third-party cover but as well as offers cover against personal accident. In personal accident cover, you get a pre-defined amount against death because of the accident and permanent total disability. In addition to this, one can purchase this cover for co-passengers as well even on an unnamed basis, which will be maximum as per the seating capacity of the vehicle. However, the amount of coverage is pre-determined even in this case.
• Loss or Damage of the Insured Vehicle: A comprehensive car insurance policy provides coverage against damage or loss to your car. Reasons for damage like fire, accident, or self-ignition are covered in this plan. In addition to this, if the car faces losses because of theft, burglary, terrorism, riots, then also an insurance policy covers it. Moreover, it also covers loss or damage occurred due to transit via train, air, road, inland waterways, or lift.
• Vast Network of Garages: Most of the car insurance providers have a wide range of network garages that are spread across the country. This feature ensures that you can get the service of your car anywhere in India.
• No Claim Bonus: One of the best benefits of having a car insurance policy is its No Claim Bonus (NCB) feature. You are eligible to avail of this offer for each claim-free year. The NCB is available as a discount on the next premium and this makes car insurance policy comparatively more affordable.
• Liabilities of Third-Party: If your car meets with an accident and causes loss or damage to the property of a third-party, then do not worry as it is covered under car insurance policy. Moreover, if you come across any legal liabilities because of an accident by your car like death or injury to any person or property, then do not worry, your car insurance provides you coverage for the same.

How to Choose the Best Car Insurance Policy?

Finding the best car insurance policy can be a great deal, as this is a yearly investment that you make to cover the risks while driving on the road. The market is bursting with numerous four wheeler insurance plans providing value-oriented services to its customers. And it can get quite confusing to find the best car insurance policy online?

This checklist of the best car insurance companies in India will help you compare different quotes from various insurance companies online and select the best deal for yourself. You can check out this list of the best four wheeler insurance plans for 2020, by analyzing their features including the incurred claim ratio, network garages, and the coverage benefits.

Points to Consider While Selecting Car Insurance Policy

• What is covered - Checkout the inclusions and exclusions of both third party insurance and comprehensive vehicle insurance policy. Only buy third party insurance if you can bear your own damage expenses.
• Compare Car Insurance Online - Compare car insurance online and select the one that meets most of your financial expectations. You can easily get multiple four wheeler insurance quotes online from the best car insurance companies in India.
• Incurred Claim Ratio - Higher ICR, indicate satisfied customers and more the chances of your claim being settled.
• Add-on Covers - It is always recommended to buy a comprehensive car insurance policy with additional benefits like roadside assistance, zero depreciation, flat tyre assistance, etc.

What’s Covered in Car Insurance Policy

The car insurance policy covers the following:

• Loss or damage to the insured vehicle.
• Loss or damage to your vehicle caused by accident, theft, fire, explosion, self-ignition, lightning, riots, strikes or act of terrorism, natural calamities.
• Financial liability caused by the injury/death of a third party or damage to the property.
• Personal accidental insurance cover.

Add-On Covers in Car Insurance

Add-on covers are the additional covers or protection that you include in your 4 wheeler insurance plan to keep your car safe from any damages or total loss. The add-on covers need to be purchased on payment of extra premium amount. Following some add-on covers are No Claim Bonus Protection cover, Zero Depreciation cover, Engine Protection cover, Key protection cover, etc.

• No Claim Bonus Protection Cover

  For every claim free year, the insured is rewarded with a discount on the renewal premium. This discount is called - No Claim Bonus (NCB). It is cumulative and increases every year. It usually ranges from 10% to 50% and can save a substantial amount of money on the premium payable for your auto insurance.

  Let's take an example if a policyholder doesn't make a claim during the tenure of his auto insurance policy, he becomes eligible for No Claim Bonus, on the basis of which, a certain rebate is offered on the payable premium. With No-claim-bonus protection cover you can retain your NCB even after registering a claim during the policy term. The terms and conditions vary from one insurer to another.

• Engine Protection Cover

  An engine is one of the most important parts of a car. And engine protection cover compensates the cost of fixing the indirect damage that are caused to the engine due to lubricating oil leakage and water ingression. It covers the Gear Box Parts, Engine Parts, and Differential​Parts.

• Zero Depreciation Cover

  This additional feature offers compensation even for the depreciating value of your car. With this feature, you will not have to pay for the depreciation value of your vehicle’s parts. It is mostly valid on private cars and is subjected to a specific number of claims during the policy period. Compulsory and voluntary deductibles (as per the case) will be applicable despite zero depreciation cover. You can check with the insurance company for any terms and conditions before making the purchase.

• Consumables Cover

  Sometimes, a bunch of unforeseen expenses can drain all your savings. Consumables Cover​​. Includes all the expenses incurred on consumable items for any perils that are covered under the policy. Consumable items include screws, nuts and bolts, washers, AC gas, grease, lubricants, bearings, clips, engine oil, distilled water, oil filter, brake oil, and fuel filter are mostly covered.

  There are certain terms and conditions that are applicable to this add-on cover that varies from one insurance provider to another. It is mostly valid on private cars and is subjected to a particular number of claims during the policy period. You can check with the insurance company before making the purchase.

• Key Protection Cover​

  Once in a lifetime everyone would have lost or misplaced their car keys. In such cases, the insurer can offer you the financial help by covering the costs incurred on replacement and repair of your car keys. Here’s was Key Protect Cover​will offers.

  • You will be permitted for a fixed number of claims during your policy period
  • Any case related to theft or burglary should be supported by a Police FIR
  • The replaced keys will be of the same type as the ones that were lost or stolen
  • Any broken or damaged keys will be replaced by the insurer
  • In case of misplacement or theft of car keys, the insurer will replace the entire set of keys including h lockset, after submission of all the other keys to the insurer

• Daily Allowance Benefit​​​​​

  ​​​In case of accidental damage, you might have to leave your car in the workshop and travel on your own. This add-on cover comes to your rescue when your vehicle is parked in the garage after an accident for repair. If you have this add-on cover the insurer will provide you daily travel allowance if the vehicle requires has to be in the garage for more than 3 days (varies from insurer to another).

• Personal Accident Rider Benefit

  Personal Accident Rider is an optional add-on benefit that can be added to the comprehensive auto insurance by paying an extra premium. This rider provides the policyholder with the coverage of medical expenses due to damage, personal injury or disability caused due to an accident.

• Cover for Car Accessories

  By simply opting for separate add-on policy, you can avail the coverage for your car accessories, which a normal 4 wheeler insurance policy may not cover. Such additions may increase the premium, but it is always beneficial and cost-effective rather fitting a new car accessory.

• Save Through Paying High Deductibles

  Deductibles are a certain percentage of the claim amount that the insured has to pay from this own pockets. A policyholder can save by paying higher deductibles. At the time of filing a claim, if you choose to pay higher deductibles against your claim, your auto insurance provider manages to give you some discount on premium later on.

What’s Not Covered in Car Insurance Policy

Following features are usually not covered in car insurance policy:

• Loss or damage if a policy is not in force.
• Gradual wear and tear of car and its parts.
• Loss or damage to the vehicle when driven by a person without a valid driving license.
• Loss or damage to the vehicle as a result of intoxication due to drugs, alcohol etc.
• Loss or damage to the engine as a result of oil leakage.
• Loss or damage to the vehicle as a result of abuse of car manufacturer's guidelines.

How to Calculate Car Insurance Price

Car insurance price is decided based on several factors. It is also easy to find out the car insurance premium using an online car insurance calculator. However, the insurance provider takes into consideration the following parameters before fixing the car insurance price:

• IDV (Insured Declared Value) of the vehicle
• Age and Type of Car
• Engine's Cubic Capacity
• Geographical zone

Car's IDV Calculation Formula:

IDV = Car's Showroom price + Accessories cost – depreciation value

Thus, the formula to calculate OD premium amount is:

Own Damage premium calculation formula:

Insured Declared Value X [Car Premium as per the insurer)] + [ Optional Benefits] – [NCB/Discount etc.]

How to Renew Car Insurance Online?

It's mandatory to renew your car insurance to avail of the policy benefits without a break. Therefore, you should ensure your car policy before it gets expired. Follow the steps given below to renew your car insurance policy online:

• Go to the renewal section.
• Enter the details required on the page, such as your policy number, mobile number, date of birth, etc. and submit them
• Choose the car insurance plan that you want to purchase
• Select the riders or add-on covers that you want to buy or drop (if any)
• The premium amount that you need to pay will be shown on the page
• Pay the insurance premium online with the help of a credit card, debit card or through net banking
• Once the payment is complete, your four wheeler insurance policy will be renewed

You will receive the policy document for your renewed 4 wheeler insurance on your registered email id. You can also download a copy of the policy document and get a printout anytime you want.

Benefits of Renewing Car Insurance Policy Online

A car insurance plan has a validity period and after its expiry, you need to renew it for keeping your car insured. You can renew your car insurance policy either offline or online. Even though many of us still follow the traditional method of offline renewal of the policy, but opting for online policy renewal is better. Here are a few benefits of renewing your car insurance policy online:

• Easy and Quick Process: For renewing your online car insurance policy, all you have to have is good internet. With the help of a good internet connection, you can renew your car insurance plan at the convenience of your home anytime. In this way, online renewal is easy and fast as you do not have to go to a branch of the insurance provider or call an agent for renewal. Moreover, the online renewal process is paperless or requires very minimal paper-work.
• Simple Customization of Policy: You can easily customize your car insurance policy while renewing it online. You can enhance the coverage of your policy by adding add-ons to it. However, before topping your policy with an add-on, you must keep in mind that the premium majorly depends on the cover type that you are taking.
• Secured Renewal / Purchase Process: Car insurance renewal online is an easy process because of the availability of all the required information over the web. This transparency enables you to make an informed decision. In addition to this, payment through secured gateways of payments ensures that your personal and critical information is not leaked anywhere. Therefore, it safeguards you from exposing to any fraudulent risks.
• Simple Insurance Provider Switching Process: In addition to all the above benefits, you can very easily switch your insurance provider while renewing your policy online. Since information regarding all the insurance providers is available online, thus it is very easy to compare different policies online and select the best suited to you in terms of premium and features.
• Easy No Claim Bonus Transfer Process: You should always transfer your NCB or No Claim Bonus at the time of policy renewal. While for the online renewal process, it is really easy and quick in comparison to offline renewal.
• A Transparent Method: Since in the online renewal process everything is in front of your eyes. This means nothing is hidden or no agent or someone is hiding any information from you. Whether it is a comparison of policies or switching of plans or payment processing everything is selected by you and happens in front of you. So, we can easily say that this method of policy renewal is completely transparent.

Benefits of Buying Online Car Insurance Policy

Buying online car insurance policy is a common practice today. With the buying of car insurance policy online, you can insure your car against any damage due to an accident, theft, fire etc. You can buy online car insurance within 2 minutes. If you are wondering why most people prefer to purchase four wheeler insurance online, check out its benefits below:

• No More Agents

  Offline purchase of insurance policies involve agents who try to sell their own product rather than suggesting you a better policy from another insurance provider. Online purchase of new car insurance will eliminate such agents and you can buy the best policy after comparing various plans offered by different insurance companies.

• Zero Paperwork

  Another benefit of buying four wheeler insurance policy online is zero paperwork. Contrary to the offline mode which requires you to fill multiple forms, the online mode allows you to fill up all the forms online. You can also upload the required documents online making the application process digital and free of any paperwork.

• Convenient & Saves Time

  As compared to the offline modes, buying 4 wheeler insurance online is very convenient. You don’t have to visit to a branch of the insurance company or take out time to meet the agent. You can get your car insured from the comforts of your home, hence, saving a lot of time and efforts.

• Payment Reminders

  Missing policy payments or renewals can cost you a great deal. Not only will you lose out on the renewal discounts but also have a break in policy. But if you purchase your car insurance policy online, you will receive timely reminders ahead of your due date ensuring that you do not miss out on the payments.

• Cashless Facility

  Buying 4 wheeler insurance online offers cashless facility and involves zero cash transaction. You can make payment of your insurance premium online through online modes such as debit card, credit card and internet banking.

• Easy Comparison

  With the online purchase of four wheeler insurance, you can easily compare the plans offered by different companies. Online aggregators allow you to compare the coverage and the premium quotes provided in different plans before selecting an ideal insurance policy for your car.

• More Cost-Effective

  Buying insurance policy online is more economical as you save a lot of in-between costs. Your premium reduces due to elimination of agents, zero paperwork and you get discounts that further reduce the amount of premium you pay.

• Easy Endorsements

  Endorsement refers to any changes in the information provided in the policy document. in case of online endorsements, you just have to give a self-declaration as opposed to the filling up the endorsement form manually and submitting all the documents.

• Soft Copy of the Document

  Another benefit of applying for car insurance online is that you have a soft copy of your policy document in your email. This makes it easy for you to access it from any place without the need to carry a hard copy with you.

Third-Party Car Insurance Cover vs Comprehensive Car Insurance Cover

The main difference between third-party car insurance and comprehensive car insurance is the cover they offer. On one hand where third-party insurance covers your car against any loss or damages to third-party. On the other hand, comprehensive car insurance provides coverage for own vehicle damage as well. Let us compare these two types of motor vehicle insurance policies:

Therefore, comprehensive car insurance is better than a third-party insurance cover because of the vast coverage provided by it. Moreover, you can customize your coverage by adding add-ons in your plan while a third-party car insurance plan leaves you exposed to risks like damaging your vehicle.

Let us elaborate these two to understand the difference more clearly:

• Third-Party Car Insurance

  A third-party car insurance is a four-wheeler insurance policy that provides financial protection to the insured car’s owner against any loss or damage to some third-party, which can be another person or another person’s property. According to the Motor Vehicle Act, 1988, it is mandatory to have at least a third-party car insurance policy. So, this policy provides:

  • Legal Liabilities
  • Third-party Liabilities
  • Compensation for death of another person from the insured four-wheeler.

• Comprehensive Car Insurance

  A comprehensive car insurance policy provides a vast coverage that includes both – liabilities of third-party and own damage. Purchasing a comprehensive plan is not mandatory as per the law, but because of its vast coverage, many car owners prefer this insurance policy. The inclusions of this policy are:

  • Provides coverage against own damage.
  • Has a vast range of coverage.
  • The provision of add-ons improves insurance coverage as well.

Methods of Purchasing Comprehensive and Third-Party Car Insurance:

It is not at all difficult to get a car insurance policy. You can purchase it by any of the below-mentioned three methods:

• Online: For purchasing a comprehensive or third-party car insurance policy all you have to do is to go to the website of your selected car insurance provider and with minimal to no paperwork you can buy a car insurance policy online.
• Visiting the Nearest Branch of the Insurance Provider: Once you select the insurance provider, you can visit its nearest branch and get your car insured.
• With the Help of an Insurance Agent: Last way is through an insurance agent. An insurance agent is the affiliate of the insurance provider. An agent provides the application form with other details.

How to File a Car Insurance Claim?

All the car owners, at some point in time need to file a car insurance claim for a certain loss or damage. To avoid any confusion while filing a 4 wheeler insurance claim, here are a few points that you need to consider:

• Make sure that you have the following Information ready with you at the time of claim Intimation
• Time & date of the accident
• Name of the driver and contact details along with driving license details
• Four Wheeler Insurance Policy number
• Estimated loss
• A brief description of the incident
• Survey location to support the investigation process
• Insured contact details
• Claim intimation should be provided at the customer help desk. They will take you through the claim process
• Once you have informed, the insurer's customer support team will provide you the claim reference number
• Upon claim registration, a surveyor will be assigned for your case
• You will receive the confirmation notification on text along with the details of the loss assessor
• You can coordinate for a suitable time with the surveyor and he will conduct the survey as per your convenience
• There are certain documents that you need to provide to the assessor, such as vehicle type and severity of the damage
• You also need to inform about the requirement of the claim processing team to settle own
• damage claim
• Coordinate with the surveyor again if re-inspection of the vehicle was advised by him.
• Based on the survey claim settlement will be done

Documents Required for Filing a Claim for Car Insurance

Keep the following documents ready while registering a claim with the Insurer-

• Copy of Police FIR
• Claim form duly signed by the policyholder
• Fitness Certificate for commercial vehicles
• Driving License
• Car Registration Certificate (RC)
• Insurance documents with the endorsement

The insurer will settle your claim within a week from the date of submission of all the required documents.

How to Get your Online Car Insurance Quotes at PolicyBazaar?

On PolicyBazaar you have to fill a few simple details like make of the car, model, variant, year of manufacture, etc. You will then get car insurance quotes from various insurance providers. This way you will get customized quotes, one which saves money on premiums and is also the best fit as per your needs.

You must be familiar with the following terms while filling the form:

• Car Make, Model and Variant

  This information is critical to calculating the base premium. A luxurious, powerful and expensive car will attract more premiums. For e.g. an SUV car will always have a higher premium than a family car.

• Year of Manufacture

  The manufacture year of your car lets the insurance company assess its Insured Declared Value (IDV) that facilitates the underwriter to decide the annual premium for your car.

• CNG Fitted Car

  Being more vulnerable to combustion, a CNG fitted car is usually insured at a slightly higher premium than a plain petrol/diesel car.

• Additional Covers

  You need to mention whether you do or do not want to get a cover on electrical and non-electrical accessories fitted in your car. Most insurers provide a cover for your car accessories at an additional premium of 4% on its value.