Getting a new car is a moment of joy and pride, especially if it is your first car. Your car will accompany you on long drives, road trips, family outings, and even commuting for work. Hence, your car will be an important part of your life. Just like you protect your family and loved ones, you must also protect your car with a robust car insurance policy. This is even more important in India where the incidents of accidents and other road mishaps are always on a rise.
Understanding the types of car insurance coverage
There are two main types of car insurance policies available in the market:
- Third party car insurance
In India, a third party car insurance policy is mandatory. You must have this basic car insurance to be able to drive your car on Indian roads. It offers coverage for third-party liabilities. In case of an accident, the liability arising out of damage to a third party or their property is covered under this insurance.
Since third party insurance is mandatory, it comes at a fixed affordable rate. However, this insurance does not offer any coverage for own damage.
- Comprehensive car insurance
In addition to the benefits offered by third-party new car insurance, comprehensive insurance offers coverage for personal losses due to accidents, theft, fire, and natural and manmade calamities.
While third-party car insurance is mandatory, you can upgrade your car insurance policy to comprehensive coverage to enjoy additional coverage. To get the most benefits out of your policy, it is important to understand all aspects of your policy document. You must be fully aware of all the features and inclusions of your policy.
Understanding car insurance policy inclusions
Car insurance comes with several conditions and features that are considered at the time of claim approval and settlement. If your claim request does not adhere to the inclusions of your car insurance policy, it may get rejected.
Some expenses that are usually not covered by car insurance include the cost of deductibles, depreciation cost etc. But, you can avail of those benefits by getting them included in the new car insurance policy, for an additional cost, at the time of policy purchase.
Hence, reading and understanding the policy document and making an informed decision are very important when buying car insurance. Here are the five inclusions you must look out for when buying comprehensive car insurance:
- Zero depreciation cover
Depreciation is the loss of value of your car over the years due to wear and tear, age, decrease in market value or obsolescence. More often than not, the claim you receive is the amount after deducting the depreciation amount calculated over time for your car. This clause is often hidden and goes unnoticed in a car insurance policy. By having a zero-depreciation clause in your car insurance, you can enjoy the entire claim amount and avoid depreciation deductions. Remember to check if your new car insurance policy has this coverage or not.
- Key and lock replacement
We all have lost some keys at least once in our lives. This add-on might seem silly, but it is in fact very beneficial. Car keys can be broken, fall out of pocket, left at a party or even forgotten inside the car. Having this add-on in the car insurance policy allows you to get replacement keys in no time.
- Coverage for consumable items
Many times, you go to claim for insurance and receive a reimbursement much less than what you expect because of the cost of deductibles. These are consumables or non-reusable parts used in repairs such as lubricants, bearings, gaskets, washers, gases nuts and bolts. By having this cover included in the car insurance policy, you can rest assured that the insurance company will pay for the cost of these deductibles.
- Engine and gearbox protection coverage
This cover gives your engine and gearbox protection against damage. In case of damage during an accident, the insurance provider agrees to pay for the repair and replacement of these parts, as well as the labour charges. This cover is extremely useful in case your engine gets damaged due to heavy rains or if water enters the engine in an unfortunate incident. This can lead to damage to not just the engine, but also the gearbox. The repair can cause a heavy burden on your finances if you do not have engine and gearbox protection.
- 24*7 roadside assistance coverage
Getting stranded amidst nowhere or in a remote location far away from a garage can be scary. This cover will save you from all the stress and panic. This add-on cover will help you with all kinds of roadside assistance in the least possible time. The cover includes breakdown support, towing the vehicle to a garage, minor repairs, assisting with a jumpstart, and even arranging for a cab to the nearest accommodation. So, do not forget to include roadside assistance coverage in your new car insurance.
Final word
While these are some pretty useful add-ons that must be there in your car insurance policy, there are more options available that you can avail of. Hence, it is a good idea to spend some time and compare the pros and cons of policies and inclusions offered by different insurers before choosing a car insurance policy that meets your needs.
Additionally, once you purchase the policy, do read the documents carefully so you do not miss out on any important clause. Understanding the inclusions of your car insurance will ensure there are no troubles or delays at the time of making a claim.
Disclaimer: The above information is for illustrative purposes only. For more details, please refer to the policy wordings and prospectus before concluding the sales.