Imported Car Insurance

Buying an imported car is a major milestone. Whether you bring in a luxury sedan or a rare sports car, protecting it with a car insurance policy is both mandatory and important. Here is everything you need to know about imported car insurance in simple terms.Read more

What is Imported Car Insurance and How is it Different from a Regular Policy?

In India, imported car insurance is not a separate category but part of normal motor insurance, which is mandatory as per the Motor Vehicles Act. The key differences between the two lie in premium cost and underwriting. While coverage remains the same as domestic cars in India, imported vehicles attract higher premiums. In contrast, domestic cars are easier and cheaper to insure due to widely available spare parts and service networks.

Why Imported Car Insurance Costs More

The premium for imported car insurance in India is much higher than that for a standard car policy. Here is why car insurance companies charge more:

• Higher Market Value: Most imported cars like Completely Built Units (CBU) or Completely Knocked Down (CKD) models are fully made abroad, which attracts high import duties, taxes and other associated expenses that add up the total vehicle cost.
• Expensive Spare Parts: If the car gets damaged, mechanics often have to ship replacement parts from overseas or specialised suppliers. This can make repairs more expensive and increase the potential claim amount for the insurance company.
• Specialised Labour: Imported cars have specialised servicing needs that require expert mechanics who understand foreign engineering. The limited availability of trained mechanics may result in higher repair costs.

Coverage Under Imported Car Insurance

The coverage under imported car insurance is the same as for standard car insurance in India:

• Own Damages: A comprehensive or own damage policy for imported cars covers repair or replacement costs if the vehicle is damaged in a crash, vandalism event, or natural disaster.
• Theft & Fire: Provides compensation up to IDV (Insured Declared Value) of the vehicle if it is stolen or damaged by fire or riots.
• Third-Party Liabilities: Mandatory cover for legal obligations regarding injury, death, or property damage you cause to others while driving your imported car.
• Transit Damage: Protects the car while it is being transported via road, rail, air, or water

What is Not Covered Under Imported Car Insurance?

Insurance for imported cars excludes the same standard scenarios as regular policies in India. However, it also has unique exclusions regarding import duties, parts availability as well as strict regulatory compliance. Here are the general exclusions:

• Regular wear & tear
• Electrical or mechanical breakdown
• Driving without a valid licence
• Drunk driving
• Illegal use of the car
• Consequential damage
• Unauthorised modifications
• Depreciation on replaced parts
• Driving outside the policy terms

Read More: Inclusions and Exclusions of Motor Insurance

Essential Add-ons to Choose With Imported Car Insurance

Since imported cars are expensive to maintain, you should buy these car insurance add-ons for total peace of mind:

• Zero Depreciation Cover: Standard policies deduct money for wear and tear when replacing parts. A zero-depreciation add-on ensures the insurer pays the full cost of plastic, rubber, and glass parts without any deductions.
• Engine Protection Cover: Importing a new engine can cost a fortune. This add-on covers engine damage caused by water logging or oil leakage.
• Roadside Assistance (RSA): If your car breaks down in the middle of the road, finding a local mechanic who can fix it is hard. RSA ensures your car is safely towed to a specialized workshop.
• Return to Invoice Cover: If your car is stolen or completely wrecked in an accident, this cover pays you the full original invoice price of the car, including registration and road tax.

Documents Needed for Buying Imported Car Insurance

When buying imported car insurance, keep these documents ready:

• Your vehicle's Registration Certificate (RC)
• Bill of Entry (Proof of import and customs duty payment)
• Passport and Visa copies of the owner (if imported personally)
• International Driving Licence or Indian licence copies
• Sale Invoice showing the exact cost of the car

How to Insure Your Imported Car in India?

You can easily buy imported car insurance in India online from Policybazaar.com by following these simple steps. Ensure you keep the above-mentioned documents handy and declare any modifications like custom accessories or high-end mods to prevent claim rejection later.

• Choose Policy Type: Visit the 'Car Insurance' section, select 'brand new car' or provide your vehicle details. and choose a policy that suits your requirements.
• Customise Your Coverage: To enhance your imported car insurance coverage, select add-on covers like zero depreciation cover, engine protection and return-to-invoice.
• Pay the Premium: Review your final coverage and premium, and complete the payment via UPI, cards, or netbanking.
• Receive Your Policy: After successful payment, you will receive your imported car insurance policy via email.

Essential Requirements for Insuring an Imported Car

Before you insure your imported vehicle in India, you may first need to fulfil the following regulatory conditions:

• Homologation Compliance: The imported vehicle must pass local safety and emission testing (homologation) by agencies like ARAI (Automotive Research Association of India) or have valid UN ECE compliance certifications.
• Right-Hand Drive: The vehicle must be a right-hand drive with speedometers configured in kilometres (not miles).
• Clear Documentation: You must present the Bill of Entry, custom clearance certificates, manufacturer compliance records, and proof of paid import duties to establish the correct IDV of your imported car.

Tips to Reduce Imported Car Insurance Costs

Follow these useful tips to lower your imported car insurance costs:

• Install certified anti-theft devices may reduce your premium
• Choose an imported car that has easier access to spare parts can lower future repair costs
• Maintain a clean driving record helps you earn no-claim bonuses over time
• Select only the necessary add-ons will keep your premium more affordable
• Renew your policy on time prevents lapses and avoids late payment penalties