Top Factors to Consider When Selecting Car Insurance in India
Buying car insurance is an essential step for every vehicle owner in India. Not only does it comply with the law, but it also provides financial protection against damages to your vehicle and third-party liabilities. The process of purchasing or renewing car insurance has become simpler, quicker, and more transparent with the advancement in technology. However, selecting the right insurance can still be challenging. Understand the top factors you should consider to ensure you choose the best car insurance in India at a competitive price.
1. Understand the Types of Car Insurance Available
Before getting into the factors, it's crucial to understand the different types of car insurance available:
● Third-Party Liability Insurance: This is the minimum legal requirement according to the Motor Vehicles Act, 1988. It covers damage caused to another person or property by your vehicle, but it does not cover damages to your own vehicle.
● Comprehensive Insurance: This includes third-party liability and also covers damage to your own vehicle due to accidents, theft, fire, and natural disasters. It offers a higher level of protection and is advisable if you seek extensive coverage.
Understanding these types will help you determine what basic coverage you need and what additional covers might be beneficial for your specific situation.
2. Evaluate Your Coverage Needs
Assess how much coverage you actually need based on your driving habits, car value, and personal comfort with risk. If you frequently drive in congested areas or regions prone to natural disasters, comprehensive insurance might be a better choice. Consider your car’s age, too; older cars might not require as much coverage as newer, more expensive models.
3. Consider the Insurer's Claim Settlement Ratio
The claim settlement ratio is a crucial factor when selecting an insurer. This ratio indicates the percentage of claims the insurer has settled compared to the claims received in a year. A higher ratio means the insurer is more reliable and settles claims efficiently. Opt for an insurance provider with a high claim settlement ratio to ensure a smoother experience if you need to make a claim. For instance, according to the IRDAI Annual Report, Bajaj Allianz achieved a claim settlement ratio of 98.48% during the financial year 2021-22.
4. Check for Cashless Garages
Insurers have tie-ups with certain garages where you can get your car repaired without having to pay upfront – the insurance company settles the bill directly with the garage. Check if the insurer has a wide network of cashless garages, especially near your location. This feature can significantly ease the process of getting repairs done in case of an accident.
5. Compare Insurance Premiums and What Influences Them
Car insurance prices can vary significantly between providers. Factors that influence the cost of your car insurance premium include:
● Type of coverage: Comprehensive insurance generally costs more than third-party insurance.
● Car model and make: High-end cars are more expensive to insure.
● Engine capacity: Cars with higher engine capacities typically incur higher premiums.
● Geographical area: Areas with higher accident rates or theft rates tend to have higher premiums.
Use online comparison tools to compare different policies based on these factors. This will help you find the best car insurance in India at a reasonable price.
6. Look for Discounts and No-Claim Bonus (NCB)
Insurance providers often offer discounts for various reasons, such as a good driving record, installing anti-theft devices in your vehicle, or holding multiple policies with the same insurer. Another significant discount is the No-Claim Bonus, which is a discount given for every claim-free year. It can significantly reduce your premium over time, so consider an insurer that offers a substantial NCB.
7. Understand the Add-ons
Add-on covers are additional protections you can purchase on top of your basic car insurance policy. Some popular add-ons include:
● Zero Depreciation: Ensures you get the full cost of parts replaced without depreciation being factored in.
● Roadside Assistance: Provides services like towing, flat tyre changes, and emergency fuel delivery.
● Engine Protection: Covers damages to your engine due to flooding or oil leaks.
Choose add-ons based on your specific needs, but be mindful that each add-on will increase your premium.
8. Read Reviews and Customer Feedback
It’s important to understand other customers' experiences with the insurance provider. Check online forums, social media, and review platforms to get an idea of the insurer’s customer service, claim settlement process, and overall reliability.
9. Check the Fine Print for Exclusions
Every insurance policy has exclusions – situations or damages that are not covered. It's important to read and understand these exclusions before purchasing a policy. Knowing what is not covered will help you avoid surprises at the time of a claim.
10. Consult with an Insurance Advisor
If you find it challenging to decide, consult with a professional insurance advisor. They can provide personalised advice based on your specific needs and help you manage the complexities of various policies.
Choosing the right car insurance requires careful consideration of various factors. By understanding the types of coverage available, evaluating your needs, comparing different policies, and checking the insurer’s service quality, you can find the best car insurance in India that fits your budget and provides ample protection for your vehicle. Remember, a well-chosen car insurance policy is not just a legal requirement but a pillar of financial security in case of vehicular mishaps.
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*Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms and conditions, please read sales brochure/policy wording carefully before concluding a sale.
(No Hans India Journalist was involved in creation of this content)