Should You Buy New Car Insurance From the Dealer or Online?

When purchasing a new car, most dealerships offer an insurance policy along with the vehicle. While accepting the dealer's insurance quote may seem convenient, many buyers wonder whether they can get better coverage, lower premiums, or more flexibility by purchasing car insurance online. The best choice depends on factors like policy premium, features, add-on options, and the ease of buying the policy. Here is a complete guide to help you understand the major differences between dealer and online car insurance so you can make an informed decision.Read more

Is It Mandatory to Buy Car Insurance From the Dealer?

No, While it is mandatory to have valid motor insurance before driving a new car on public roads, you are generally not required to purchase the policy offered by the dealership.

Most dealerships provide insurance quotes as part of the car purchase process. However, as a buyer, you are not just stuck with their options. You can compare multiple plans from different insurers and even purchase a policy separately before taking delivery of your new car.

Why Do Car Dealers Offer Insurance Plans?

Dealerships often have partnerships with car insurance companies to offer policies at the time of vehicle purchase. While this provides convenience because:

• Insurance is arranged along with vehicle registration
• Documentation is completed in one place
• Buyers can take delivery without arranging insurance separately;

However, convenience should not be the only factor when selecting a policy.

Dealer Insurance vs Online Insurance for a New Car

The table below highlights the major differences between the dealership insurance and online insurance for a brand-new car:

Is Dealer Insurance More Expensive Than Online Car Insurance?

Not always, but it is worth comparing.

Dealers may provide policies from specific insurance providers, while online platforms allow you to compare plans from multiple insurers simultaneously. Due to this, buyers may find differences in:

• Premium amounts
• Insured Declared Value (IDV)
• Add-on coverage
• Deductible options
• Available discounts

Hence, comparing quotes before finalising a policy can help ensure you get the appropriate coverage at the right price.

Does Buying Insurance From a Dealer Make Claims Easier?

Many car buyers assume that purchasing insurance from the dealership ensures a smoother claim experience. However, In reality, claim settlement depends primarily on:

• The insurer
• Policy coverage
• Claim documentation
• Surveyor assessment
• Network garage availability

The platform from which you secure your car insurance does not determine whether a claim will be approved or settled faster.

You may also Read: Car Insurance Claim Process Guide

The Reality of Cashless Claims

Cashless claims in car insurance allow you to get your car repaired at an authorised workshop without paying from your pocket, except for the compulsory deductibles. But the convenience of this facility depends on whether the insurer has a tie-up with the workshop, which exists regardless of whether you bought car insurance from the dealer or online. Usually, reputed insurance companies have a wide network of cashless garages across India. Hence, the dealer cannot deny you cashless facilities just because you bought the policy elsewhere.

When Buying Insurance From the Dealer Can Be a Good Option

Dealer insurance may be suitable if:

• You are a first-time car buyer seeking assistance
• You do not have time to compare multiple policies
• The dealer's quote is competitive
• The offered policy includes the add-ons you need

Why Buying New Car Insurance Online is a Better Choice

Buying insurance online for your new car is beneficial because you can:

• Compare plans from different insurers
• Find competitive premium options
• Have greater control over add-ons
• Review policy features before purchase
• Customise coverage based on your requirements

Questions to Ask Before Accepting a Dealer Insurance Quote

Before purchasing your new car policy offered by the dealership, consider asking these questions and then make an informed choice:

• Which insurer is providing the policy?
• What is the IDV offered?
• Which add-ons are included?
• Can the premium be revised?
• Are there alternative plans available?
• How does the quote compare with online options?

So, Which Option Should You Choose?

If convenience is your top priority and the dealer's quote offers suitable coverage at a competitive price, purchasing insurance through your car dealership can be a practical option. However, if you want to compare multiple insurers, customise coverage, and evaluate different premium options, car insurance online may provide greater flexibility. The best approach to buying new car insurance is to compare the dealer's offer with other available plans before making a final decision.