Car Insurance Policies in India
Car insurance, also known as vehicle insurance, is done to protect your vehicle from losses occurring due to unpredictable mishappenings. It is a contract signed between the customer (usually the owner of the car) and an insurance company. A premium is paid by the customer to safeguard the car so that in case of car theft or accidental damage the insurance company pays for the losses. The premium of the car insurance depends on certain parameters like value of the car, coverage type, classification of vehicle, voluntary excess etc.
There are several types of car insurances available including auto insurance that is a third party car insurance and car insurance with medical cover and so on. Auto insurance provides coverage on life and third-party property. It means that if a third-party incurs a loss in an accident caused by the insured car, the insurance company will pay the expenses. You can check for the most suitable type of car insurance online and check the best car insurance prices that you can afford. It is always advisable to check out and compare car insurance options and additional riders before choosing one.
Why do you need Car Insurance?
According to the Motor Vehicles Act 1998, it is compulsory to have car insurance in India. The most basic insurance cover for a car provided by all car insurance companies is the third-party liability cover that states that any damage caused by the insured car to itself or another party will be covered under this insurance. Thus, you free yourself from the burden of any damage caused by your car or to your car will not be charged to you, but to your car insurer. Car insurances allow you to raise a claim for any loss incurred if it is stated under the insurance plan, the insurer will take care of the expenses, provided there is no sign of fraudulence.
Although there is a mandate rule to own commercial car insurance, there are numerous vehicles in the country that do not own one. You can find many options for car insurances online and chose the best car insurance for your vehicle. With the growing rate of accidents in the country, it is vital to invest in new car insurance than to be spending a whole lot once the damage has been made. Most people ignore the importance of this while buying a new car and face the consequences of high charges later on. If you feel that you cannot afford to avail insurance at the moment, all you have to do is compare car insurances online and you will find very cheap car insurances that will fit your budget.
Types of car insurance policies in India
Generally, the period of validity for a car insurance policy is 1 year. It is important to renew your car insurance policy when it is nearing its expiration stage. There are two broad categories of car policies namely the third-party liability insurance and the comprehensive insurance. Each car policy offer different covers and each are based on what they offer. Here is a quick glance on the two broad car policy categories:
- Third party liability insurance: this is the most basic type of car policy and is mandatory for every car owner to posses. This insurance covers charges of protection against third party injury or damage. It is the best car insurance in India provided most accidents in the country cause damage to the other party and this insurance covers the heavy charges that may be otherwise levied. The third party liability insurances covers damage or injury to third party vehicle or person involved in the mishap. However, any damage or injury caused to the insured vehicle or the owner of the insured vehicle is not covered under this insurance.
- Comprehensive car insurance: this insurance provides a more extensive coverage for the vehicle. Additional to third party liability, this car insurance policy also covers protection to own car and owner or driver involved in the accident. Here are a list of coverage that this car insurance policy provides:
- Damage to car caused due to natural calamities, example: earthquake, lightning, flood, storms, etc.
- Damage or loss caused due to crime or human intervention, such as strikes, theft, etc.
- Any damage caused to the vehicle while transporting it from one place to another, either through road, rail or water.
- Personal accident cover – this insurance covers any unfortunate event caused to the driver such as permanent disability or death. There are insurances options that are also available for protection of co-passengers of the insured vehicle
Due to the large coverage offered by comprehensive car insurances, the premiums are much higher than the third party liability insurance. It is undoubtedly the best car insurance in India to opt for considering the numerous natural as well as man-made calamities that occur in the country.
You can now buy car insurance online by comparing and choosing among car insurance prices that suits your budget the best. There is also a hassle-free option for online car insurance renewal when your insurance nears its expiry.
What is IDV and why is it important?
Insured Declared Value, abbreviated as IDV, is the highest amount that you can claim for when car theft happens or damage has been made to your car. It is the current market value of your vehicle. Even in cases where complete damage or loss has been caused, this is the maximum amount that can be gained from the insurance. The vehicle information mentioned below will be assessed in order to arrive at an IDV value for your car:
- Registration details and information of the vehicle
- City of registration
- Registration date or the date of purchase of the vehicle
- The current type of registration; company or owner
- The model and make of the car and its manufacturer
- Car engine’s cubic capacity
- Vehicle’s full description
- Former showroom cost of the car
The IDV value of the car is directly determined by the insurance premium paid by the owner. With time, the IDV value and premium decreases proportionally. Here is a brief of an IDV calculator to measure your IDV in insurance:
|1st year (brand new car)||Car insurance is presented at 95% of the ex-showroom price with 5% depreciation.|
|At the renewal of the 2nd year||Car insurance is presented at 80% of the ex-showroom price with 20% depreciation.|
|At the renewal of the 3rd year||Car insurance is offered at 70% of the ex-showroom price with 30% depreciation|
|At the renewal of the 4th year||Car insurance is offered at 60% of the ex-showroom price with 40% depreciation|
|At the renewal of the 5th year||Car insurance is offered at 50% of the ex-showroom price with 50% depreciation|
|At the renewal of the 6th year||Here onwards, 10% to 15% depreciation on the IDV of the previous year is measured. Each subsequent year, this amount is deducted proportionally.|
Not many people are aware of what is IDV in insurance. It is vital to know the value of your car in order to refrain from either understating or overstating your car value.
How is Car Insurance Premium Calculated?
It is extremely important to calculate the premium you will be paying before opting for an insurance as one should be able to keep up to the payments in a timely manner. Car Insurance companies have made it easier for potential policy holders by providing value-added services and instantly providing quotes of the insurances to them. The main factors that the premiums are calculated upon are:
- Manufacturing year of the vehicle – the age of the car is determined by the year it was manufactured. The premium of the car decreases as the age of the car increases.
- Place of registration – Car insurance companies have formed the concept of “insurance zones”. These zones carry value of vulnerability of your vehicle and the loss or damage caused in the area is a factor in calculating the premium. Premiums in urban areas cost more as the risks are higher.
- Present showroom price – the market value of the car determines the IDV of the car. Higher car cost means higher premiums to be paid.
- Car model and make – Cars that are imported pay a higher premium than regional cars. Similar diesel cars higher than petrol and high-end sedans and SUV’s more than hatchbacks.
- Car purpose – The purpose of a car also determines its premiums. A car used for personal use attracts lower premiums than commercial cars.
- Safety devices – airbags, advanced brakes and anti theft devices are all part of modern equipped cars. These cars are more prone the thefts and thus attract higher premiums. It is a must that the features enabled in your car need to be approved by the Automobile Research association of India.
- History of claims – If a claim has previously been raised against any damage of your car, the upcoming year premium will probably rise too. However, if no claims have been asked for at all, a no claim bonus will be awarded by a decrease in the premium that needs to be paid.
Apart from the mentioned points, your car insurance premium calculator also depends on your driving record, total distance driven, credit history, car servicing regularity and more.
Benefits of Buying Car Insurance Policies Online
The importance of car insurance is coming to awareness by the day and insurers are making it easier for everyone by bringing it to them through the widely connected internet. Here are several benefits of purchasing your car insurance online:
The internet can be accessed from any place at any time and this works as an advantage for those with tightly packed schedules who do not have the time to commute to the car insurance company. There are websites as well as apps available for the same
- Simple and easy to use
All the necessary information required for you to buy your car insurance is available on the car insurance company’s website or app in a well structured and detailed manner. This makes it easy to use for everyone and is also hassle free and less time consuming. Your documents can be uploaded online itself and in case of any query, an online assistant will be available to help you.
- Comparison parameters
With all the options documented on one single page, it makes it easier for the policy buyer to consider, contrast and compare car insurances online and choose the one that best suits him/her.
- Lower costs and lesser paper work
A lot of cost is cut don when you buy your vehicle insurance online. With everything needed to be uploaded, there is no hard copy paper work involved in this process. Moreover, insurers provide a lower cost of insurance premiums for those who purchase their insurance online.
- Instant premium calculation and approval
You can also calculate the premium to be paid using the online premium calculators provided on their websites. This helps better planning in your financial expenses for the month.
- Easy endorsements
Using the online feature, makes any changes or additions required to your insurance policy much easier at your own time and place
- Agent free
With the rising amount of fraudulence in the country, there is a fear of being faked by insurance agencies as well. Taking charge of your car insurance online means there is no middle party involved and you can directly access all details of your insurance
With all the information and clauses put out to you in the open, there is complete transparency while purchasing your insurance online. However, it is the duty of the policyholder to make one aware of them all.
- Safe documentation
All the information and policies under your name and the related documents is available under one file in the website. Unlike otherwise, where you need to keep all the paperwork intact
- Easy and timely renewal of policy or transfer of policy
Online car insurance renewal is completely easy and not time consuming at all. There are also reminders enabled in the apps to remind you when your plan is close to its expiration date. Through the online app or website, you can even transfer your existing insurance plan to another insurer easily
These are the main benefits to buy car insurance online, and not offline.
Compare Before Buying the Best Car Insurance Policy Online
It is important to choose the right car insurance coverage while buying it, otherwise it is a waste of investment. Although you will have access to several insurance salespersons when you buy a new car, it is important to weigh down the pros and cons of each by yourself. All the information can be found online and purchasing an apt insurance after good research yields better results.
Apart from the car companies themselves, several third party companies have websites that help you in this process of comparing and are absolutely free of cost. Comparing quotes from different dealers is the best way to get the best deal for your insurance. Doing a research with all the information available online, equips you to making a better decision in buying your car insurance. Here are the two main points to consider while comparing your policies:
- Cost and coverage – While choosing a car insurance, you might lose out if you opt for the cheapest one available as it might have the least coverage. Instead, choose an affordable one that has equal weight-age to coverage as well as the price being paid for the insurance.
- Reputation of the insurance company – make sure to assess the company providing the insurance. Always opt for an insurer who has a high claim settlement ratio and is well known in the industry. Reading customer reviews are a great way to narrow down to one as it speaks about the personal experience they faced
Keep these points in mind and do compare car insurance online before choosing one.
Top Car Insurance Companies in India
There are several insurers in the private as well as public sector that offer an array of car insurances along with add-ons. In general, the public sector car insurance companies have always been preferred over the private ones given their trust-worthiness and deliverance. Nevertheless, private players in the insurance industry have also prove to be strong competent in the market in recent times. Here are the names of the top few car insurance companies that you can rely on:
- ICICI Lombard General Insurance Company Ltd.
ICICI Lombard is one of the top players in the market. Brand loyalty and customer centricity is seen to be the pride of this company. The key attractive features offered by them are:
- Assistance for towing
- Facilities for Doorstep surveyor
- Purchasing online policies in instalments
- Cashless claim settlement facility
- The Oriental Insurance Company Ltd.
This company has earned its name over the years of existence in the market. It has a vigorous financial framework and has been awarded several times for its excellence in business. The insurer is known for:
- Immediate claim settlement facility
- Valuable add-on covers to policyholders
- Tata AIG General Insurance Co. Ltd.
TATA AIG has managed to acquire a large customer base over a short period of time. This proves its efficiency and order in its business framework. The main features of this insurance are:
- Repair work warranty
- Free car pick-up service
- Cashless claim settlements
- Settlement of all claims within 7 business days
- Various beneficial add-ons
- HDFC ERGO General Insurance Co. Ltd.
HDFC has a strong distribution network and is customer oriented company. They are one of the main players amongst the private insurance companies given their aggressive claim settlements. The main features of their insurance plan include:
- Discounts based on profession and age
- Swift claim settlement process
- Limited application documents
- Cashless claim settlement facility at more than 1,600 network garages
- Enthusiastic customer service team
- New India Assurance Co. Ltd.
This is a public sector company that also has international presence. It is well known for its innovations in terms of insurance solutions. The key factors that you will benefit from choosing their insurance plan are:
- Claim decision requires only 3 days to be made
- Within 48 hours of claim being made, a surveyor will be appointed
- Claim payments are made timely
- Acknowledgement of all grievances takes place within 3 days
- Decision of grievances are made within 15 days
Satistics of Car Insurance companies
|Car Insurance Company||Claim Ratio Incurred*||Status Of Grievances*||Solvency Ratio*|
|Bajaj Allianz General Insurance||69.19%||99.28||2.61|
|Bharati Axa General Insurance||89.09%||99.81||1.65|
|Cholamandalam MS General||79.82%||99.82||1.64|
|Future Generali India Insurance||81.77%||99.86||1.72|
|HDFC ERGO General Insurance||89.43%||100||—|
|ICICI Lombard General Insurance||78.91%||97.61||2.1|
|IFFCO Tokio General Insurance||84.37%||99.94||1.6|
|Liberty General Insurance||77.29%||99.06||2.87|
|Magma HDI General Insurance||78.49%||84.96||2.07|
|The New India Assurance||86.95%||99.19||2.19|
|The Oriental Insurance||126.66%||95.36||1.11|
|Reliance General Insurance||91.39%||99.32||1.68|
|Royal Sundaram Alliance General||82.15%||99.28||1.69|
|SBI General Insurance||102.07%||95.33||2.19|
|Shriram General Insurance||103.18%||100||1.94|
|Tata AIG General Insurance||79.31%||99.93||1.8|
|Universal Sompo General Insurance||89.77%||100||1.57|
|United India Insurance||78.89%||98.51||1.15|
Inclusions and Exclusions in Car Insurance
The inclusions and exclusions of car insurances vary depending on the type of insurance. The table below states the inclusion and exclusion for third party liability insurance:
|Liability for third-party injury – Any injurY caused to a third person will be compensated by the insurer||Injury to self – coverage for injuries caused to you in an accident will not be covered|
|Liability for third-party property damage – Any damage caused to a third party’s property will be paid by the insurer||Damages to your car – Does not cover any damages or loss caused to your car|
The following table states the inclusions and exclusions of comprehensive car insurance.
|Own-damage cover – in addition to third-party liability cover, you can claim for damages cause to your car in the accident.||Policy not in-force – If your policy has expired, no damage or loss costs will be incurred by the insurer|
|Personal accident cover -Covers the finances towards any injury caused to you in an accident||Nuclear risk and war – Does not cover damages caused due to any nuclear war or calamities|
|Coverage against natural calamities – protection against earthquakes, floods, landslides, etc. will be covered
|Usage of alcohol and other intoxicants –
Does not cover accidents costs caused due to intoxicate drivers
|Stolen car –
The IDV will be paid to you by the insurer if your car is stolen
|Consequential damage – The policy does not cover any damage caused due to consequential mishaps such as driving inspite of an oil leak.|
|Man-made disasters – Damages caused by man such as strikes and riots are covered under this policy||Deliberate accidental loss – If discovered that the loss of vehicle has been staged or any fraudulent activity, it will not be covered.|
|Malicious acts –
Non-licensed drivers or drivers who haven’t followed the rules and have caused an accident will receive compensation for the mishap
|Type of vehicle – Claim could be rejected if any manipulation is made regarding this.
What is RTI in car insurance?
It is important to be aware of what is RTI while buying car insurance in India. RTI stands for return to invoice cover. This is an add-on policy that bridges the gap between the IDV and the invoice value. This enables you to receive the on-road price of the car when you claim your insurance. Damages beyond repair, stolen cars or any considerable financial losses are all covered under this policy. The RTI cover generally costs a little more (10% higher than the comprehensive car insurance plan) given its wide coverage. This add-on feature of RTI policy retains the depreciation value of the vehicle that will not be offered to you under just a comprehensive car insurance policy, as the IDV will be the payout in the event of a claim in the latter.
Car Insurance Add-On Covers – Optional but most important
|Zero depreciation cover||This cover enables you to claim the entire cost of damage in an accident and thus is the most popular add-on covers in car insurances. All charges will be covered by the insurer. Subsequently, this cover also eliminates the depreciation element attached to your car and refunds you with the total car value as priced upon purchase. This cover can be purchased within 5 years of buying the car and insurance can be claimed twice under this policy.|
|Engine protect cover||This cover is limited to cars that are within 3 years of purchase. It is not only limited to physical damages but also extends its offering to engine related repairs. It is particularly uselful for new cars and cars of high end models. This rider comes at a higher cost as the cost for repairing engines are higher.|
|Return to invoice cover||This add-on covers pays back the market value of your car by avoiding the depreciation costs. Cars under the age of 3 years are usually considered for this policy.|
|Loss of personal belongings cover||This is a unique kind of cover where compensation up to Rs.50,000 is offered for the loss of personal belongings such as laptop or phone, etc. that were stolen from a locked car.|
|NCB protect cover||The Non Bonus Claim is a benefit gained from not claiming insurance over a period of time. This bonus is then deducted from the subsequent premium payment.|
|Roadside assistance cover||This additional cover provides roadside assistant services such as towing the vehicle, flat tyre change, mechanic services, etc. However, there are several conditions that this policy is based on. While some insurance plans have this as an in-built feature, some offer it at a nominal price.|
|Personal accident cover for passengers||This is a cover that offers cover for co-passengers in the insured vehicle during an accident. Any partial disability or death caused to them while in the vehicle, will be compensated by the insurer. The price is usually rs.1 lakh|
|Daily allowance||This enables the driver or owner to hire another car while the insured car is at the garage for repairs or is stolen. A rate of Rs. 500 to Rs.1000 is given per day depending upon the model of the insured car. This amount is usually provided for 10-15 days.|
This insurance add-on covers the amount spent on consumables such as engine oil, nuts and bolts, screen-washers, etc. post the repair of the car after an accident. Only vehicles with an age under 3 years is eligible for this cover
|Key replacement cover||
This cover enables you to replace the lock and key of your car in the event of a theft by the insurer
Things to Remember Before Buying a Car Insurance Policy
Once your car has been brought, it is highly advisable to immediately purchase your car insurance as well. Purchasing the right vehicle insurance policy and additional ride-on is essential in safeguarding your car. Here are the important points to keep in mind while buying your policy:
- Amount of coverage – There are two categories of covers such as third-party liability and comprehensive cover. Although comprehensive car insurance covers all the needs, some might not require it and may opt for the basic third party liability plan.
- Add-on coverage– There are several add-on riders available for your car insurance. However, it is important to research and figure out what best fits your need and purchase only them.
- No-Claim Bonus (NCB)– A no claim bonus can be claimed if you haven’t claimed for any damage or coverage over the past year. This claim decreases your subsequent premium amount.
- Explore the option of voluntary excess– By opting for a voluntary excess, you will be bringing down your premium rate significantly. It is the amount you will have to bear while making a claim and will be mentioned by the insurer while purchasing the policy.
- Compare policies online before buying– Always compare the numerous policies made available to you. This can be easily done when you buy car insurance online as there are several portals that help you with this. You can save up big money by doing so and purchase an affordable one.
- Check if the insurer is offering cashless claim settlement facility – Some insurers offer cashless claim settlement facility and it is important to be aware if your insurer is offering the same this will make your work easier. It is also vital to choose an insurer with a good reputation in the market.
- Make sure you do not nullify the insurance while customising your vehicle – Some insurances do not cover charges over customised vehicle, and thus, it is important to be aware of your insurance descriptions and keep the additional changes as minimum as possible.
Get the Benefits of Buying Car Insurance Online
With the world moving towards digitalization, there are several benefits that can be gained from it. Here are some benefits that you can gain from buying your car insurance online:
- Economical– Lower premiums and costs are incurred while buying your car insurances online. This is due to the fact that there are lesser operational costs involved.
- Convenient and saves time -. Buying a car insurance online saves up a lot of time and energy. Online process are made user friendly and is a quick process with well developed financial sites.
- Instant policy – Your policy will be issued immediately once you buy it online as there are no physical documents involved and processing them online is less time consuming.
- All policy documentation in one place– All your documents are secured in one place under you policy name on the respective website and thus can be accessed from anywhere in the world.
- Updates to policy– Adding or updating your policy can now be done easily from home by simply filling in a self-declaration document and avoiding the tedious offline forms
- Renewal reminders -. While managing your policy online, automatic reminders are sent for renewing your policy when it’s close to the date of expiration.
- Review policies and read reviews from other customers– Compare and weigh all the pros and cons of the policies information made available to you online. Also read customer reviews while choosing your insurer as the reputation of the company matters.
- Paperless transactions– Buying insurance policies online avoids the use of paper involved in the process. These don’t only make your work environmental friendly but are also highly efficient.
Misconceptions about Purchasing Auto Insurance Online
There are certain misconceptions involved in purchasing your car insurance online such as:
- Authenticity– People are sceptical about the authenticity of online companies selling insurance. Licensed broker, insurance company, or web aggregator are all considered authentic sources under the IRDA (Insurance Regulatory and Development Authority). Intermediaries registered under them are all safe options to consider.
- Reliability – Although, there are several online sites striving in business currently, the reliability of many are questionable. You can be assured that online transactions are safe to make for insurances as all financial aggregators they have strict security policies and comply with global security standards.
- Geographical distance– It is a misconception that claims made online are more difficult to follow up with. However, there are many online insurance assistance who will follow up timely and ensure smooth processing of your claims.
Documents Required to Buy Auto Insurance
The following are the basic documents required in purchasing your car insurance online:
- Driving license– This is a basic requirement for acquiring your insurance. This helps the insurance company in assessing your history of driving record and a good record might subsequently bring down your premiums as well.
- Bank information-Your bank account details are required for insurance companies to ensure you run a smooth credit check.
- Vehicle details– The premium of your car insurance will be based on the model and type of your car. Thus, your vehicle details are required by the insurance companies.
- Other details– The insurer will also require other basic information such as your name, address, date of birth, etc.
How to Verify the Authenticity of Your Motor Insurance Policy?
It is important to ensure that the insurance policy you purchase is authentic. Go through the entire document of policy before signing the document. Here are some ways you can cross-check and verify if your insurer is fake or authentic:
- Contact your insurer
Ensure your channel of reaching out to insurers is valid and reliable. A certificate stating that they are a genuine insurer is a must to be provided and is your right to ask them. You could get their official number through the website and ensure that the website is original.
- Ask for receipt
Ask your insurer to provide you with an invoice for the premium that you have paid.
- Check the information provided
through and be check all the information provided to you. This includes the deductibles, no claim bonuses and IDV’s.
- Ensure that you sign on the proposal form
It is important that you yourself go through the proposal form and sign in by yourself rather than depending on someone else to proof read it.
- Compare the policy with online site
One the policy is in hand, compare it to other policies. All genuine policies are easily available online and it helps you choose the one that best fits your needs.
- QR code
. It has been made compulsory by the IRDAI that a QR code should come along with every insurance policy. Using a smart phone, you can scan the QR code and get all the details on your screen.
How to Purchase Car Insurance Online?
Car insurances can be brought directly on company websites or on third party financial websites. There are several advantages of purchasing them through a financial aggregator website. Some of the benefits and reasons to buy car insurance online are:
- Minimal paperwork is involved and thus making it a seamless experience.
- It is an easy platform to compare all the available options and helps you make a fruitful decision
- Online expert assistance is also provided in any issues or claims
- Online transactions are faster, hassle-free and safe
Agents vs Dealers vs Brokers
There are several channels through which you can acquire your car insurance. Some of the authorised entities by the government for the same are brokers, agents and car dealers. Here is a comparison chart of all three in helping you choose the best way to process your insurance:
|Insurance agents||Brokers||Car Dealers|
| Insurance agents are individuals authorised to represent an insurance company.
|Insurance brokers are representatives are not representatives of the insurers, but of the customers.||Car dealers act as intermediaries between the customers and insurance companies. They are not licensed to distribute insurances. However, they get a commission based on their tie up with the insurance company and car manufacturers.|
|An insurant agent is limited to represent only one insurer.||Brokers are liable towards the customers acquiring a desirable insurance policy.||Buying an insurance policy from a car dealer can be more expensive than buying it from a broker or through online financial parties|
|Agents are well trained to give out information on behalf of the insurance companies. However, are not liable to answer anyone if the customer has been misguided.||Brokers are there to helps policy buyers choose the right plan for their insurance and thus need to be hands-on with all the policies available in the market||Car dealers are limited to a certain amount of policies. Thus, it is suggested that you search for more options outside as well. Online is great way to make yourself aware of the available options.
|An insurance agent can be dismissed by their respective company for providing wrong information, advice or any issues||In case of any misleads, a customer has the rights to file a complaint against their broker|
Mistakes To Avoid When Buying Car Insurance
When you buy a car, you keep many aspects in mind. Unfortunately, the same efforts are not made while buying car insurance. Thus, many car owners commit some common mistakes while buying car insurance.
Here are some common mistakes that you should avoid when you plan to purchase car insurance.
Not comparing insurance quotes
It is beneficial and advisable to compare the different rates offered by various insurance companies. Moreover, when you compare these rates you will also observe the difference in the policy features offered by these firms.
Selecting unnecessary Add-ons
A standard car insurance package policy comes with many add-ons as well. These add-ons are sometimes needed and sometimes only add to the cost of the policy.
Not reading the policy document properly
Most of the car insurance buyers receive the policy document but never read it. This is not advisable. You should always read the details properly to determine that all the credentials are correct.
Not selecting the right car insurance company
A common mistake that car insurance buyers commit is not choosing the right insurance company. You should look for these following parameters while selecting your car insurance firm:
- Claim settlement ratio
- Digital Presence
- Quality of Customer service
- Cashless garage Network
How to Lower your Car Insurance Premium
Car prices are on an all time high due to the increased demand for these four wheel vehicles. In addition, the car insurance premiums are also increasing. Thus, you should be aware of various facts and tips that can assist you in reducing your car insurance premium.
Here we take a look at certain reliable tips that can lend you a helping hand in getting your car insurance premium reduced.
Avoid those additional fittings
Your car insurance premium is calculated at a basic level coverage which is based on fuel type, vehicle’s age, vehicle’s value, etc. Any extra fittings such as a CD player, ultrasound censor, etc can alter your car insurance premium. Thus, it is advisable not to go for any kind of extra fittings.
Go for that NCB Protector
Various car insurance firms offer a facility as per which the client can pay a little extra premium and can get their NCB protected even when there are claims made during the policy period.
Get quotes from different insurance firms
Since the market is very competitive, it is advisable to seek quotes from different car insurance firms and then compare the benefits and premium features.
Anti-Theft Devices for Cars
Car is a valuable possession and it becomes a hazard if unfortunately it is stolen. However, in the recent past, there has been a major increase in the number of car thefts. Thus, many anti-theft devices for cars have been devised and introduced in the market.
Here are some reliable anti-theft devices that can help you protect your car from being stolen.
Gear locks are considered to be flawless defense mechanism for cars. Breaking a gear lock requires efforts and is time consuming. Thus, thieves do not prefer breaking car gear locks.
Many security systems have come up with different kinds of car alarms that discourage car thefts. Moreover, these car alarms also alert the owners of the cars when someone tries to break in the car.
ICAT or intelligent computerized anti-theft systems are another ideal way of protecting your cars from being stolen. When you have ICAT in your car, it will start only when sensor in your vehicle accepts the chip placed in the car system.
Another perfect anti-car theft way is using GPS tracker which can assist in tracking your stolen car as well. Moreover, it can also alert you for any attempt to steal your car.
How to Renew an Expired Car Insurance Policy
Car insurance renewal is an imperative process and if you forget to renew your car insurance, it may cause problems for you. Car insurance policies come with a particular term period during which it covers different damages as well as expenses. Once this term period gets over, your car insurance policy does not remain applicable anymore and thus you need to get vehicle insurance renewal as soon as possible.
Here is a step-by-step guide go for car policy renewal.
Steps to consider while renewing expired car insurance policy
When you face an expired car insurance policy, you should:
- Try to get in touch with your car insurance firm as soon as possible. They will use the car insurance renewal premium calculator to tell you the amount to be paid.
- It is advisable to choose a different insurance policy or renew your existing policy, as per your needs and wants. Car insurance renewal needs some major efforts on your part.
- You need to schedule a vehicle survey appointment for renewing your car insurance renewal
- After the vehicle inspection has been done, purchase the new insurance policy immediately once your vehicle has been classified as fit.
These above-mentioned steps can lend you a helping hand in renewing your expired car insurance policy in the best possible manner. Moreover, you can also go for online car insurance renewal.
Car Insurance Renewal Checklist
Your four wheel vehicle definitely needs car insurance, be it your small sized car or your luxurious vehicle. It is advisable to select the best car insurance firm and enjoy the benefits of discounts and features provided by it. Moreover, there are also some points to be considered while going for car insurance renewal.
Here is a car insurance renewal checklist that needs to be kept in mind while renewing your car insurance policy.
Check the IDV
IDV is basically the value of your car which a car insurance company assesses after deducting the depreciation value from the car’s original value. Thus, it is always advisable to keep a check on IDV of your car.
History of the claim settlement of your car
Whether you are planning to buy a car insurance policy online or offline, always make sure to check the credentials of the insurance company. You should see how successful the company has been in settling their earlier claim settlements.
Premium amount is based on many factors such as IDV, car type, NCB or no claim bonus percentage, and many others. Insurance companies imply the following normal rates:
- 20% over your first renewal
- 25% over your second renewal
- 35% over your third renewal
- 45% over your fourth renewal
- 50% over your subsequent renewals
How to Go for Online Car Insurance Renewal
Online car insurance renewal is an easy and time saving medium of getting your insurance policy renewed. Internet has made everything easier and online policy renewal is no different. Many people are going for online car insurance renewal and even enjoying the benefits.
To make things easier for you we have come up with steps to lend you a helping hand in finishing the task from the comfort of your house.
Just keep a track of your renewal date
Insurance providers usually send usual reminders about your renewal date either via SMS or even through emails. It is always advisable to keep a track of your renewal date on your mobile or in your work diary.
Enter your policy details as asked
Online car insurance renewal policies are the easiest to purchase and renew. You just need to log on to the insurance firm’s website and log in your details as asked. Moreover, you need to click on the button ‘Policy renewal’ on the website.
Follow the directions
Follow all the directions and instructions as given on the insurance firm’s website. The insurance firm would take only a few minutes to complete the process of online renewal.
So, simply renew insurance online by following these simple steps and get rid of all the tensions.
What is a Car Insurance Claim?
When you are on the road, there are chances that you may rub your car with other vehicles and can incur damages. This is where car insurance claim comes into picture. Now the question is what exactly is a car insurance claim? A car insurance claim is when a particular damage to your car is insured by your insurance policy.
Now the next question that comes into mind is how to claim car insurance? Here is the procedure to go for car insurance claim.
- Immediately call your insurance representative even if you are not at home or if someone else has been responsible for the accident. This is the first step regarding how to claim car insurance.
- Ask for your representative’s guidance in the matter. He will guide you on how to claim car insurance. He will tell you what documents you should submit and how you should proceed.
- Your insurance firm may as k for a proof of loss firm to be submitted. In addition, you may be asked to submit other documents such as your medical forms, car repair bills, copy of the police complaint etc. You should submit all the information correctly and within the time frame given.
- Keep a proper record of all your expenses incurred on car repair. These expenses may be reimbursed under your car insurance policy.
- Keep all the copies of all the documents required. These may be needed for future reference as well.
Moreover, your insurance firm may want to get your car inspected properly and then judge the damages done. Then only they would want to give you your insured money as per your policy. Thus, it is necessary to remain ready for the inspection from their side with all the essential documents ready. These steps should be your perfect answer to how to claim car insurance.
How to claim on your car insurance policy
With the increasing number of vehicle theft and accidents, it is essential for the car owners to insure the cars. Not only insurance, understanding about how to file a car insurance claim is also very important. It is very unfortunate that your vehicle may be damaged due an accident or stolen. When the car theft or accident occurs, you need to contact your insurance company representative immediately for an insurance claim. Within one or two days after the intimation, the car insurance company will schedule the survey. After all the process, you will receive the approval for the repair amount. Below are the procedures to claim on your car insurance.
- When the car or stolen or damaged due to an accident, contact your insurance representative immediately. They will guide you through the procedures.
- Explain to them what had actually happened and provide all the required details. The representative will guide you and let you know about the required documents and forms to be filled.
- A form called “proof of loss” is very essential for the insurance claim. It could be anything like car bills, medical bills and FIR report from police.
- Make sure to maintain proper record of your expenses, because this may be required for the reimbursement.
To process your claim, you need to provide all the required documents your insurer demands.
Partial Claim Settlement
In certain cases, your insurer will not pay the whole amount. There could be several reasons, your insurer may feel that your claim has estimated the huge amount or may think that the claim is unnecessary. In such cases instead of rejecting the whole claim, they may agree to pay the partial amount. This scenario is called as Partial Claim Settlement. To avoid such scenarios, it is advised to read the policy document cautiously.
Documents Required for Car Insurance Claim Settlement
It is always advised to keep all the required documents handy. This will help to speed up the claim process. Based on the type of the car insurance policy the essential documents needed for filing claims are as mentioned below.
The claim process for theft:
If the claim is initiated for vehicle theft, you need to contact your insurance provider or representative after filling the FIR.
The following documents are for theft claims:
- Claim Form duly signed
- RC copy of the vehicle with original keys
- A no trace report from the police (It is a declaration saying that the vehicle cannot be traced or located)
- Original FIR copy
- Copy of Driving license
- Policy copy
- RTO transfer papers duly signed along with Form 28, 29, 30 and Form 35
The claim process for the accident:
Keep a record of all your vehicle expenses that occurred due to the accident. The following documents are for theft claims:
- Duly signed the claim form
- Registration certificate copy of the vehicle
- Copy of Driving license
- FIR copy
- Original estimation report
- Original repair invoice &payment receipt
- Points to Remember:
- There are certain points that need to be remembered while processing the insurance claim.
- Make a note of the vehicle number that involved in the accident.
- If there are any witnesses make a note of their name and contact details
- You can contact your insurance provider to know the claim number and reference number
- Remember to intimate the insurer immediately, because the insurance provider has all rights to reject your claim request if the intimation is delayed.
- If you have any doubts about carrying out the claim process, you can contact the representative who can guide you through the claim process.
- Before surveying the vehicle, no repair should be done.
What is Cashless Car Insurance?
Some companies have their network garages where the repairs can be taken for damaged vehicles. Instead of paying the whole amount some companies offer cashless car Insurance. Some people may be wondering how to claim car insurance or how the benefit is a cashless car insurance policy as compared to regular car insurance policy. Experts say that when you go for a cashless insurance claim, you can carry out the repair work without worrying about the repair bill or amount. All you need to do is to pay the deductible cost, the remaining amount will be paid by your insurance provider.
People who opt for a cashless car insurance claim can get their car repair done at any of the garages of their network. The repair bills are sent to the insurance provider, based on which the reimbursement is made. You need not pay even a single amount from your pocket. As compared with another regular insurance claim this is pretty fast and hassle-free. To claim the cashless motor insurance policy, you need to follow certain steps. They are as follows:
- Ensure to inform your insurance provider regarding the incident
- Every company has different formats for an insurance claim.
- You should visit the garage for the inspection of your damaged car
- You should inform the garage about the insurance claim to proceed things in a proper way.
How does it work?
Some insurance companies have tie-ups with certain garages. According to the policy, the repair work of the vehicle will be carried out by the garage and the bills will be sent to the insurance provider. The payment of the bills will be settled by the company after thorough verification. To get the complete repair done, contact your garage because some parts will not be covered under the cashless policy. For those repair work, people are liable to pay for the repair work.
Myths about Car Insurance
There are several myths that have been said about the car insurance over years. Not all of them are true, most of them convey false facts. Believing false facts can lead to a heavy loss because you may end up in purchasing wrong insurance coverage. This can cost you a huge amount of money in the long run.
Below mentioned are the few common myths that are believed by the people:
- You need to get the car insurance from a car insurance agent who dedicatedly works for an insurance company.
Truth: To buy the best insurance policy you need to get the quotes from different insurance companies. You can also approach an insurance agent but you need to contact several agents working for different companies. Doing a comparison of the different insurance companies is the best way to buy the best and cheapest insurance policy.
- Insuring Red cars will cost you more
Truth: Insurance premium is not based on the color of your vehicle. It is completely based on the vehicle specification such as Model, Make, Engine Size, Body Type, and Age. Apart from the vehicle specification the details like driver’s age, driving record and history will also have an impact on the insurance cost.
- Your insurance provider will pay off the vehicle in case if the car faces heavy loss due to an accident.
Truth: As per the policy, the insurance provider will pay off the fair market price of the car. The market value is the original cost of the vehicle. There are some cases, where the payoff value can be less than the more than the car’s market value. In such cases, the owner should take the entire responsibility of the remaining amount.
- The credit of the customer cannot be viewed by the insurance provider or they cannot be used as a factor to determine your premiums.
Truth: Most insurance companies in India use your credit history to set your rates.
How Much is No-Claim Bonus for Car Insurance in India?
No claim bonus is a concession, given by an insurance provider to a policyholder. The customer can enjoy this benefit if he had made no claims during the policy tenure. The discount percent can range from 20% to 50% in the damage premium that can be added over years. People can make use of the no claim even if the vehicle is changed, they can be transferred to his new vehicle. Because NCB is not associated with the vehicle but the policyholder. The amount saved on Own Damage premium will keep increase year on year with the discount percentage increases every year. Hence, you need not worry about the NCB while you purchase a new car, you will be able to retain your NCB on replacing your old car with a new. If you want to know more about the discount percentage refer the below table. The policyholder can clearly make savings by not making any claim.
|After one free claim year||20%|
|After two consecutive free claim years||25%|
|After three consecutive free claim years||35%|
|After four consecutive free claim years||45%|
|After five consecutive free claim years||50%|
Rewards for Car Insurance Loyalty
There is a tough competition in the field of insurance, so insurance providers are striving hard to retain their customers and attract new people. Loyalty Rewards is one of the best ways to retain customers. Rewards for Car Insurance Loyalty offer several benefits to policyholders who had stayed with them for long period. This is one of the easiest methods for saving money on car insurance premiums with the rewards for car insurance loyalty provided by several car insurance providers. Recently, several insurance providers provide the promise of loyalty rewards to retain their valuable customers.
Mostly, all the account holders will be eligible for the customer loyalty rewards regardless of the type of policy. Be it a basic car insurance coverage or a full coverage, the rewards will still apply. The insurance providers usually offer some percentage of discount on your total bill. The amount you can actually save with these loyalty rewards are based on two different criteria one depends on who your auto insurance provider is and the time duration you had been with them. The below mentioned are some common loyalty rewards offered by several insurance providers
- Large-accident forgiveness
- Discount on Continuous coverage
- Discount on the Young driver
What is an Endorsement in Car Insurance?
Have you ever wondered what is Endorsement in car insurance? It is a pretty simple task that can easily be done by the customers. It refers to a change in policy made by the insurance provider on request of the policyholder. Hence, any sort of change made to a car insurance policy is called an endorsement. All you have to do is to write a letter requesting the insurance provider to do the necessary changes that are required. It is similar to making changes to your already existing car insurance policy. The insurance company will then do the necessary changes after verifying the accuracy of the requested change. When an endorsement in car insurance is done, the policy will include all changes that have been asked by the customer. These changes can include anything like coverage changes, loss payee changes, vehicle changes, driver changes and miscellaneous changes.
It is recommended to make the required changes then and there. To satisfy the customer needs, endorsements were provided by the agencies. Every year there are several people who make multiple changes to their car insurance policy. There are some set of people who make frequent requests for the addition or removal of coverage of the vehicle, sometimes this happens several times a month. It is recommended to avoid frequent changes as it may lead to mistakes that can cost a huge amount of money.
Canceling a Car Insurance Renewal
There might be several reasons for canceling a car insurance renewal. Some reasons could be like Selling your car, car theft, if the car is very old and unhappy with an existing car insurance company. Whatever the reasons might be, there are certain procedures to cancel the removal. Many providers offer online car insurance renewal. They are mentioned below:
- Make sure to inform your insurance provider regarding your decision of canceling the car insurance. It might take around 7 to 8 days to start the process.
- The representative will then guide you through the cancellation procedure. Procedures for canceling differs from company to company, some agencies may ask you to sign in a policy document for canceling, some might need a signed declaration and some need an email.
- Make sure to get back the certificate of car insurance policy. Because you will need them while applying for a car policy renewal and to protect the safeguard the No Claim Bonus
- If you have some time with you then check if the refund is possible. Because if you have paid the annual premium, you will receive a refund for the same from the insurance company.
When should you Change your Car Insurance Provider?
There are several reasons for the customers to think about changing the car insurance providers. Among them, the top reason is the cost. Customers will easily switch between the insurance companies if they had found another company with cheap rates.
The first thing you need to do while changing insurance company is to choose a company and policy that offers the best value for the money. Start receiving quotes from several car insurance companies. Make sure to get the quote based on the same coverage options while you request quotes. This will ensure that you get comparatively fair rates. While looking for the best rate, ensure to look into the insurance company’s reputation, customer service, and claims handling. Cheap rates should not be your only motive, you should also look for the reputation. The combination of best rates and best customer service will give you best benefit. You can also approach the insurance representative from various companies to get information about various policies. This will help you to make a better choice.
Car Insurance Claim Denials
There might be a certain circumstance where you might have requested for a claim after an unfortunate road accident. You would be expecting the money to pay off your bills and other associated expenses. Not in all the cases the insurance company will approve your claim request. Sometimes people face situations where the car insurance claim is rejected. You need to find the reason for the rejection to avoid this situation in future.
Below mentioned are some of the reasons when an insurance provider refuses your claims:
- Expired car insurance policy
- Delay in filing the claim
- Consequential Damages
- Not informing the insurer before repairs on the car
- Driving under the influence of intoxicants
- Car insurance policy not in your name
- The vehicle used beyond limits
Third-party Car Insurance Claim
As per the Motor Vehicles Act, 1988 it is essential for all vehicle owners to own a valid third party insurance cover in order to run their vehicle on the roads. In a third party car insurance policy the first party is the person who insured and the second party is the insurance company and The third party is any third person who was affected due to the vehicle. Under the third party car insurance, you can file a claim for the compensation for injury, death, property damage caused by your car.
Claim Process for Third-Party Liability Insurance
Road accidents have now become a frequent affair. People seem to know little about the car insurance claim process and procedure in case of such accidents. Hence, we often end up paying from our own pockets In case of damage to the car. Therefore, knowledge about the third party motor insurance claim will help you to make this process easier.
Three simple steps are involved in the process:
Filing an FIR and obtaining a charge sheet from the police
- Approaching a Motor Accident Claims Tribunal through a motor claims lawyer
- Examining of the claim by the court and fixing a liability
Tips to Negotiate a Car Insurance Claim
If you had submitted your claim to an insurance company along with organized demand letter and the supporting documents then your claim negotiation process will not take much time. Follow the below guidelines for a better settlement.
- Have a Settlement Amount in Mind
- Do Not Jump at a First Offer
- Get the Adjuster to Justify a Low Offer
- Emphasize Emotional Points
- Put the Settlement in Writing