If you want to drive in India, buying car insurance is mandatory as per Indian laws. It is meant to protect you and third parties from accidents, death, vehicle loss, theft and so on. But it is important to choose a policy that offers maximum coverage.
Therefore, it is imperative that you do your research about insurance before purchasing a policy. You can either do this online or with the help of your insurance agent. Either way, it is important to get your facts rights so that you can purchase the right policy for your vehicle. Here are some facts about car insurance that you should know.
Fact 1: The Indian government has made it mandatory for everyone to purchase third party liability insurance as per the Motor Vehicle Act of 1988. Driving without an insured vehicle can incur penalties. This type of insurance is meant to cover any losses suffered by a third party and protect them monetarily because of any accidents caused by your vehicle.
Fact 2: While third-party liability insurance is mandatory, it is not the only car insurance option available to you. Also, it does not cover everything and does not offer protection against natural or manmade disasters like floods, earthquakes, riots, strikes, terrorist activities and so on. As such, it is better to purchase a comprehensive insurance policy which is slightly more expensive but offers complete protection. You can also purchase add-ons with your comprehensive car insurance policy.
Fact 3: Your car insurance is valid only for one calendar year. You must renew it before its expiration date. Remember that even a single day’s delay can result in your claim getting rejected in case of any issues. Also, your insurer can either reject your application for renewal or demand a fresh inspection of your vehicle. This is why you start receiving phone calls from your insurer a month before your insurance is due for renewal.
Fact 4: Several factors play an important role in deciding your car’s premium. These include the location where you purchase the car, its make, model, current condition, engine type, insured declared value and so. Specifics of policy-holders such as age, gender, marital and social status is also taken into account. The risk on your car is estimated based on these factors, and the premium is thereby calculated. For instance, a vehicle that runs in a village where traffic conditions are always scantly is less likely to be prone to accidents as opposed to one which is used in busy metropolitan cities.
Fact 5: Accidental claims are settled in two ways; cashless claims or through reimbursement. It depends upon the insurance company and their tie-ups with motor garages. It is important to choose an insurer who has a wider network with motor garages so that your chances of cashless settlements increase. You could also choose an insurer who provides cashless service at a garage where you prefer to get your car repaired.