5 Things to Make the Best Out of Your Car Insurance Plan

To buy a car we tend to plan and research so much about the model, price, engine, interior, tires, and everything that seems important. But people usually miss out on the insurance part and underestimate its importance. It is vital for you as a car buyer to consider car insurance and make the best out of it for future financial security.

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New India Assurance

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₹ 2,962

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  • Covers damages to third party property
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Bajaj Allianz

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1024

Plan type

Third Party

Starting from

₹ 2,094

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Claim Advantage
  • Covers damages to third party property
  • Covers damages to third party person

Oriental Insurance

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258

Plan type

Third Party

Starting from

₹ 2,094

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  • Covers damages to third party property
  • Covers damages to third party person

National Insurance

Cashless Garages

268

Plan type

Third Party

Starting from

₹ 2,094

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Claim Advantage
  • Covers damages to third party property
  • Covers damages to third party person

New India Assurance

Cashless Garages

253

Plan type

Third Party

Starting from

₹ 2,094

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Claim Advantage
  • Covers damages to third party property
  • Covers damages to third party person
See more plans

Above-mentioned prices are for a 7-year-old Maruti WAGON R AVANCE LXI (998 CC) registered in Gurgaon and 15 days before expiry of previous policy

Following are the 5 major factors that you must consider before buying car insurance online.

1. Choose a Policy Based On Your Needs

Motor Insurance comes with two plan options - one is third-party motor insurance and the second is comprehensive motor insurance. As per the motor vehicle act 1988, the third-party car insurance plan is mandatory for every vehicle owner in India. 

While a third-party insurance policy only covers your liability towards a third-party person or vehicle due to accidental damage. A Comprehensive car insurance plan offers you coverage for your own loss/damage as well as third-party liability. With that dual coverage benefit, it comes with extra benefits, which you can avail by adding riders to your base plan.

It is advisable to consider the needs and requirements before buying car insurance plan. If you want to opt for only third-party liability coverage, you're good to go for a third-party plan. If you want to protect your car as well as want cover for third-party liability, you must buy a comprehensive car insurance plan.

2. Carefully choose the Deductibles 

A deductible is the percentage of amount that the insured agrees to pay from his pocket at the time of claim settlement or repair works. It refers to the amount that pertains to the portion of damages that are not covered by the insurer. 

A vehicle insurance policy comes with compulsory and voluntary deductibles options. At the time of claim or damage repair, you are required to pay the percentage of deductibles chosen by you at the time of policy purchase or renewal. Under the compulsory deductible option, the insurer decides this percentage of the claim amount that you need to pay from your own pocket.

A higher deductible means a lower claim amount and is fruitful for safe drivers. It is advisable to choose the deductibles as per your claim paying ability.

3. Correct Insured Declared Value

Insured Declared Value or IDV is an important deciding factor for your car insurance premiums. Your car's approximate current market price is what IDV is. IDV is only available with a comprehensive car insurance policy, you will not get to opt for the IDV range with third-party car insurance

IDV range comes to the rescue when your car gets stolen or damaged beyond repair due to an accident. In such a scenario, it will be considered as a total loss and your insurer will compensate you with the approximate IDV amount that you had set at the time of policy purchase.

While purchasing the car insurance plan and make sure that the IDV is currently declared, the higher IDV value means increased premium, and lower IDV value means reduced claim amount. Do not declare wrong IDV just to save on the premium, as it will create problems at the time of car insurance claim settlement.

4. Choose Your Add-on Covers Wisely

Add-on covers are only available with a comprehensive 4-wheeler insurance plan. Almost every Motor Insurance Provider offer these add on covers: Return to invoice, Engine protection cover, No claim bonus protect, Roadside assistance cover, Zero depreciation cover, and Passenger accident cover. Each rider has a unique feature and benefits that you can avail. You have an option to buy these add-on covers by paying a little extra premium. 

Since every add-on cover comes with unique features and benefits it is important for you to determine which one suits your needs and requirements the best.

For instance, if you can anticipate that there will be fewer chances of raising a claim then you shouldn't buy NCB cover with your car insurance plan.

5. Retain Your NCB by Timely Renewing Your Policy

NCB refers to the No Claim Bonus; it is a discount which you get on your plan when you don't raise a claim in one policy year.

Your motor insurance policy needs renewal every year. Although general insurance companies provide car insurance plans from 1-year term to longer-policy terms, it is advisable to opt for a longer policy term. It is so because then you will be able to avail the benefit of your insurance plan for a longer duration with the hassle of renewing it every year. 

It is imperative to keep your car insurance policy active if you have chosen a policy term of more than 1 year. If you will not renew the policy, it will get lapsed and will be of no use. Over that, you might lose the no claim bonus accumulated over the years.

You must know that the NCB amount can be as high as 50% for 5 consecutive claim-free years. To retain the NCB, you must renew your policy on time.

The Final Word

It is imperative to factor in the above-mentioned points while buying a four-wheeler insurance policy to make the best out of your plan. If you have chosen, the comprehensive car insurance policy then you have already enhanced the policy coverage for your insured vehicle. Also, it is advisable to go through the terms and conditions of your policy document to plan your insurance properly. 

Written By: PolicyBazaar - Updated: 07 September 2021
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