Protecting your car against damages due to traffic accidents, its liabilities like third party damages, own damage, damages due to natural or man-made incidence is termed as car insurance. An insurance policy also provides for accident cover of the policyholder while driving including the passengers. It also encompasses third party liability which is injury/death or property damage that the driver has to pay.
It’s a mandate by the government of India to buy a suitable car cover to driver your vehicle on road. Most insurance companies have a tie-up with the car dealers and they offer quotes along with the purchase value of the car.
While deciding upon the cover value there are a lot of factors taken into consideration like car make and model, place of living, occupation, car parking area, security aspects, etc.
However one of the key factors is Insurer’s Declared Value (IDV). It is the sum of the value decided by the insurance firm after careful examination of the car. Not to be mistaken, it can’t be the exact purchase value of your car. Insurance company’s surveyor will go through the car inspection with company norms and quote a cover value to be offered to the insured person during a claim.
Some other factors deciding the value of the car insurance policy:
Age of the Car
As the car gets depreciated every year, the insurance value of the car will also reduce. Hence, during insurance renewal, you have to ensure that you have enough cover amount to bridge up the financial losses.
A self-driven vehicle used for the personal purpose will have lower premium compare to the ones used for business purposes.
If the car and its driver are involved in frequent accidents in the past, the premium will higher. As the policies get renewed every year, any accident in this span will also result in a higher premiums rate.
Previously on public sector companies used to offer motor insurance but because of the entry of private sector insurance firms, there are varied innovative policies being sold in the markets. You can choose the policies as per your benefits and premium paying capacity. Also, online car insurance deals are quite exciting and come with loads of discounts with no involvement of agents.
As of now, car insurance sector is booming and companies are targeting the existing and potential customers with innovative policies. It is evolving and a lot of features are being introduced that will influence the premium each year.
The careful comparison is the key for a quality insurance product. You can compare policies in terms of benefits & features, discounts, premium cost, claim settlement, policy terms, and conditions, inclusion & exclusion, premium payment modes, etc. Once done you can narrow down the search to 3 to 4 good insurance policies and choose a particular one for your car. Also, ensure that you read terms and conditions, inclusion & exclusion well before you purchase the policy. At any point of time, if you doubt regarding the policy structure, call up the customer service team or visit online and have thorough chat to clear the clouds in your minds.
In case of policy lapse, your insurance provider gives a grace period of usually fortnight’s time. Post this period you might run the risk of driving a car without insurance. So, it’s always better to renewal policy at least a month prior to ensure that you’re safely sheltered under suitable car insurance.