Road accidents frequently occur and may not only be the result of your own recklessness but also the fault of others. Whatever the accident’s underlying cause, there is almost always a loss of property, and in some unfortunate circumstances, even lives are lost or irreversibly changed as a result of injuries received.
The best approach to safeguard the driver, the car’s own
er, the occupants, and pedestrians from any ensuing financial or legal repercussions is to purchase automobile insurance. Depending on the level of protection you require, there are various forms of auto insurance to choose from. Let’s discuss the five most common types of auto insurance coverage in the nation.
Contents
Here are India’s top 5 car insurance categories.
- Third-Party Liability Only Cover
- Own Damage (OD) Cover
- Personal Accident Cover
- Uninsured Motorist Protection
- Comprehensive Car Insurance
Add-on Coverages
Car Insurance Premium
Here are the 5 types of Car Insurance in India
1. Third-Party Liability Only Cover
Every motorized vehicle on Indian highways is required to have third-party liability only insurance, according to the Motor Vehicle Act of 1988. Any property, person, or vehicle that receives damage as a result of the insured’s conduct while operating their vehicle is considered the “third-party” in third-party car insurance. Due to the limited extent of its coverage, this is one of the more economical vehicle insurance options available in the nation.
The following events are those for which the third-party liability only insurance will provide coverage:
- Vehicle damage to a third party
- Property losses to third parties
- hospitalization and medical care for other people’s expenses
- liabilities resulting from third-party deaths
Theft of the insured’s car is also not covered by third-party auto insurance, nor are damages or losses to the insured’s car caused by an accident, natural disaster, or theft.
2. Own Damage (OD) Cover
The policyholder will be compensated for the expense of fixing your damaged vehicle under the collision damage cover insurance policy. Based on the age of the car and its insured declared value (IDV), the price for various kinds of auto insurance in India will be determined. The car’s market value is what the insured reported worth of the vehicle is.
The insurance provider will pay the current market value of the car in issue if the cost of the damages to your car is greater than its current value. It is feasible to have the lowest possible collision coverage for older vehicles. If your car is subject to a lien, you need coalition insurance.
When choosing between various automobile insurance coverage options, it’s crucial to remember that the insured will only receive compensation from the insurance provider in the event of an accident. Therefore, having collision damage insurance is a wonderful idea for people who reside in areas of the country where accidents are frequent or in cities with heavy traffic.
3. Personal Accident Cover
By paying for any subsequent medical costs, a personal accident insurance policy can defend the car’s owner in the event of an accident. In the event of an accident, several kinds of automobile insurance can also shield drivers and passengers from medical costs. Whether the collision was caused by the insured vehicle’s driver or another party, the insurance company will cover the medical costs. If an accident-related death occurs, the insurance provider will give the bereaved family a lump sum payment.
4. Uninsured Motorist Protection
The insurance of the person who caused the accident should pay for the cost of your car’s damages if one arises. But what happens if the driver of the other car is uninsured? Right, you would have to pay for the damages. Uninsured motorist protection steps in at this point. These varieties of auto insurance
can defend the insured when the negligent party does not have insurance. It can also save you if your third-party insurance is unable to cover the costs of your car’s damages. Both vehicle repairs and accident-related medical expenses will be covered by uninsured motorist protection.
5. Comprehensive Car Insurance
This is the most complete sort of auto insurance available for your vehicle, as the name would imply. Damage from third parties and damage to your own vehicle are both covered under a comprehensive auto insurance policy. It essentially provides total protection. The variety of protection provided against all the risk variables you might encounter when your vehicle hits the road is unmatched with these forms of car insurance in India, despite the fact that their costs can be greater than those of a third-party liability-only plan.
Protection against theft, a characteristic absent from other types of insurance, is one of the unique coverages offered by the complete insurance plan. This insurance coverage can shield your car from harm from:
- Natural catastrophes
- Human-made disasters
- Fire
- terror-related actions
The following are some situations that a comprehensive auto insurance policy won’t cover:
- damage to the vehicle brought on by drug- or alcohol-impaired driving
- Car harm sustained when operating without a legal license
- mechanical and electrical failure
- usage-related deterioration
- damage to the vehicle brought on by speeding or illegal racing
- automobile damage brought on by reckless driving
- injuries sustained while on foreign soil
Add-on Coverages
By itself, a standard comprehensive auto insurance coverage provides more security than third-party auto insurance. But there is yet another fantastic benefit to choosing a comprehensive auto insurance plan. You can select options that will further safeguard your car. As the base form of the comprehensive vehicle insurance policy might not cover it, you can tailor this kind of car insurance in India with add-ons to your own needs.
The following are some of the most sought-after extras for a comprehensive auto insurance policy:
a. Roadside assistance cover
When unanticipated problems, such as flat tires, dead batteries, or even a mechanical malfunction, occur, a wonderful road trip can come to a screeching end. This is where a supplement, such as a roadside assistance plan, might be useful. Even if your car decides to act up in a distant area, you will be able to seek assistance 24/7 thanks to this add-on.
b. Zero depreciation cover
You can utilize this kind of add-on when your automobile is damaged; it is often referred to as a “nil depreciation cover.” Insurance companies won’t pay you the whole amount of the repairs when some components of your automobile need to be replaced. They will take into consideration the parts’ depreciation and pay you appropriately. However, if you choose the zero depreciation cover add-on, you will be reimbursed for any repair costs. To be eligible for zero depreciation insurance, your automobile must be less than three years old.
c. Key replacement cover
For individuals who are prone to forgetfulness, this is a handy addition. It may be highly expensive to replace a car key if it has been lost, stolen, or broken. But with the key replacement policy, the insurance provider would pay the whole cost of fixing the key and lock set or even replacing a key.
d. No claim bonus protection
When it’s time for the insurance policy to be renewed, the majority of insurance firms have a tendency to reward the insured with a no-claim bonus reduction on the insurance rate. You might not be able to take advantage of a no-claim incentive due to the unpredictable nature of road accidents. Even if you have filed a claim, you are still eligible for the no-claim bonus discount if you purchase the no-claim bonus protection.
e. Return to invoice cover
In the event that your automobile is stolen or suffers irreparable damage, this kind of add-on can assist you in recovering the full cost of your vehicle at the invoice value.
f. Engine protection cover
Your car’s engine is its pulsating heart. In addition, fixing the component is highly costly. The engine protection cover can help with costs for the engine, gearbox, and differential that may arise from things like water logging or lubricating oil leaks, among other things.
g. Consumables cover
Consumables including lubricants, screws, washers, air conditioner gas, engine oil, and other items are typically utilized during repairs. Under a fundamental comprehensive auto insurance coverage, insurance companies do not pay for the cost of these consumables. You won’t have to pay out of pocket for these consumables if you purchase the consumables cover add-on.
Car Insurance Premium
Depending on a few criteria, the amount you pay for your automobile insurance premium may be on the higher or cheaper side:
A higher premium may be charged if you:
- Rather of third-party insurance, choose comprehensive insurance.
- Select supplemental coverage
- have a high rate of claims
- fix a new vehicle
- Don’t timely renew your premium.
A lower premium may be charged in these cases:
- You drive an ancient automobile.
- The cubic capacity of your automobile is lower
- Decide on larger deductibles.
Although there are many other forms of auto insurance, the comprehensive coverage may be the best option since it offers greater value for your money despite being more expensive than the third-party auto insurance that is required by law. Driving does, in the end, expose you to danger, so having adequate auto insurance may make you feel more at ease when driving because you will be ready for any contingency.
