Planning to Buy and Renew Car Insurance This Diwali?

Diwali is among the most awaited festivals in India for more than one reason. Other than festivities, sweets, and beautiful lights, many people consider this an auspicious time to buy new things. It is common to see many eager shoppers waiting for their new vehicle to arrive during one of these days. Many may already have a vehicle, which means you can gift yourself something equally important: car insurance.

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Why Car Insurance?

Old or new, your vehicle is an asset to be cherished and kept safe from harm. Under the Motor Vehicle Act 2019, not only is it compulsory to have motor insurance but also a great way to prolong your vehicle's life.

By financially securing your vehicle from emergency repairs or accidents, you can easily cover its cost of replacements, repairs, and more. Therefore, if you are yet to buy or renew your insurance, make sure to ask the right questions and make the most of your insurance plan.

Understanding Car Insurance

Before you proceed with your purchase, there are a few things to know about it. Understanding what your insurance policy offers or does not offers is the most important part of your purchase. With so many companies offering different plans, it is easy to get confused.

To make it simple for you, there are two types of four-wheeler insurance:

  • Third-Party Car Insurance: This one is mandatory to have as per the government regulations. This plan offers basic coverage and offers benefits only in case of any third-party liability. Any damages caused to your car will not be covered as these standalone third-party insurance plans are meant to pay for any damages caused to the other party. You will need to pay for any damages (out of your own pocket) that your vehicle may have undergone.
  • Comprehensive Car Insurance: As the name suggests, this type of plan will provide you with more coverage. Not only does it cover third-party liabilities, but also protects you from damages caused by any natural or man-made disasters, accidents, theft, riots, and more. What's more, these plans can be further enhanced by purchasing additional covers at a nominal premium.

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Tips for Buying/Renewing Car Insurance This Diwali

By now you may have realized the importance of buying insurance that suits you. Be it your first motor insurance or your annual car insurance renewal, you should keep a few things in mind. Some of the tips given below may be helpful for your car insurance renewal:

Transfer Your No Claim Bonus

If you're selling your old car and buying a new one this Diwali, don't forget to transfer the NCB to your new car's insurance plan. Many people aren't aware that no claim bonus (NCB) can be transferred. Because of Diwali, you may find many lucrative deals which may push you to make a new purchase. However, in 3 to 4 years’ time, your NCB discount can go as high as 50%. This will help you save a considerable amount of money.

Compare Different Insurance Plans

Different insurers offer different features to suit everyone's needs. This doesn't mean that you should jump at the plan you first come across. Make sure to window shop by simply learning and reading a lot about these policies. If you're doing this online, it will be easier to compare different plans to learn which one offers you the best deal under your budget. You can do all these things on including comparison as well as renewal.

Include Add-Ons

When opting for a comprehensive car insurance policy, it's always recommended to purchase some add-ons if you're serious about protecting your vehicle. Some of these add-ons are briefly discussed below:

  • Zero Depreciation (Bumper to Bumper) Cover: With this optional cover, your insurer will pay for any external damages to your car (including slight scratches and dents) without depreciating the value of your vehicle.
  • Accessories and Fitting Cover: Who doesn't like customizing their hard-earned vehicles? Accessories set your car apart and it would be a shame if they get damaged. With this cover, accessories like a reverse camera, LCD TV, and other specified parts will be protected.
  • Engine Protection Cover: If your engine needs any repair or replacements, this add-on will cover those expenses. Parts like pistons and connecting rods will also be taken care of.
  • Invoice Cover: In unfortunate accidents like theft, fire, etc. resulting in total loss of your car, your insurer will offer you the vehicle's IDV (Insured Declared Value) as the sum insured.]

Set Correct Insured Declared Value for your Car

The IDV of your car decides the sum insured by your insurance provider. In case of damages or theft, the amount of money you receive as compensation will be calculated accordingly. Keeping in mind the depreciation value as per the vehicle's selling price, you should ensure the correct value of your IDV. Also, remember that the correct IDV should neither lower your claim amount nor increase your premium amount.

Read the Documents Carefully

This may seem a basic tip but it is strongly advised to go through your policy's exclusions and inclusions; that is, the damages your policy will pay for and the ones it won't. This way, there won't be any misunderstanding or disappointment later.

Know About Network Garages

Network garages are probably the best part of any four-wheeler insurance plan as they don't require you to pay for it. The insurer directly settles any bills with these garages, so make sure to buy a policy that has a network garage nearby.

Do a Reputation Check

Finally, make sure to give a fair amount of time to learn about your insurer's market presence, reputation, and customer service. You should also confirm that their claim settlement ratio is solid with reliable network garages throughout the country.

Wrapping it up

It feels good to buy new things during such auspicious times, no matter how small that object is. A car is a huge expense for most Indians and what’s better than ensuring their longevity during Diwali? You should definitely spend some extra money on your vehicle’s protection. What’s more, you no longer need to meet an agent or go to an office insurer in person. Thanks to the online car insurance premium calculator, you can find out the exact premium to provide your car with comprehensive protection!

Written By: PolicyBazaar - Updated: 08 November 2021
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