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Car Insurance

A car insurance policy is a mandatory cover. Do buy at least a third-party cover (though the comprehensive cover is recommended) and also ensure that you get it renewed at the end of each policy year. If the policy lapses and you have to buy a new policy, you may lose out on the bonuses that you have accumulated so far.

How Credit Sudhaar can help you?

Our car insurance experts at Credit Sudhaar will ensure that you get the best possible premium rates. They will also make sure that you get all the bonuses and discounts (read details below) that you are entitled to.

Types of Car Insurance

Car insurance covers can be classified into two categories:

Third party liability insurance: These plans usually cover damage to property, accidental death and injury to a third party. This plan is mandatory. All vehicles running on Indian roads must have at least a third-party motor cover. The government has made this cover mandatory so that if while driving a car you have an accident and cause damage to either other cars or to their passengers, the burden of compensation is borne by the policy, and not by you.
The premium on a third-party insurance cover is determined by the engine capacity of the vehicle. This type of insurance is cheaper than a comprehensive cover. The premium for third party cover also remains almost constant and does not fall much as the vehicle gets older (as happens in the case of a comprehensive cover). However, remember that this type of policy will not cover any damage to your own car.

Comprehensive insurance: This type of insurance covers both own-damage and any type of liability to a third party. It will cover the cost of damage to your own vehicle, damage to the other party's vehicle in case of an accident, medical expenses for the other party and for you and the passengers in your car. It also covers the risks of theft and damage caused by calamities like cyclone, earthquake, fire, explosion, etc. The premium for a comprehensive insurance cover is calculated on the basis of the insured’s declared value (IDV) of your vehicle. As the years go by, the IDV of your vehicle will decrease, and this will mean a lower premium for your comprehensive policy. .

Benefits of Car Insurance

Car insurance offers the following benefits:

  • Coverage against loss or damage to your vehicle caused by accident, theft, fire, explosion, lightning, riots, strikes, acts of terrorism, and natural calamities like flood, earthquake or cyclone.
  • Coverage against financial liability caused by injury/death of a third party or damage to their property.
  • Exclusions

    It is important to be aware of all the exclusions (what is not covered) by your policy so that you do not have wrong expectations from it and don’t experience disappointment when you make a claim. The following are some of the conditions that are not covered:

  • Your insurer will not honour a claim if you use your private vehicle as a taxi.
  • Any damage due to war, mutiny or nuclear risk will not be paid for by the insurer.
  • If you cause damage when you are inebriated (under the influence of alcohol or drugs) or driving without a valid licence, your claim will be denied.
  • Loss or damage to the engine due to leakage of oil.
  • Eligibility / Documentation

    For a new policy you must submit the proposal form, copy of the registration certificate (RC), and proof of identity and address.

    For renewals, you will need a copy of the registration certificate, a copy of the previous insurance policy, and proof of identity and address.

    Bonus and Discounts

    You are entitled to a no-claim bonus for each no-claim year. This bonus accumulates year after year and can go as high as 50%. You can also carry it with you when you change either your car or your insurer.

    You can also get a discount on your premium if you are a member of a recognised automobile association.

    If you have got anti-theft and safety devices approved by the Automotive Research Association of India (ARAI) installed in your vehicle, it entitles you to a discount.

    Drivers who have a very good track record may consider opting for a higher voluntary deductible. In case of a claim, you will pay this voluntary deductible amount first before the insurer chips in with its part of the claim. This amount can range from Rs. 1,500-Rs. 15,000. Opting for a higher voluntary deductible reduces your premium.

    If you are renewing your motor insurance policy with the same insurer, you may ask for a loyalty discount.

    Some categories of professionals, such as chartered accountants, doctors, defence personnel and government employees are also entitled to a special discount.

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