A car insurance policy provides protection against damages that may arise out of road accidents involving the vehicle. This type of insurance is mandatory in India and car owners need to have at least a basic, minimum level insurance policy in place before driving. Provisions under the Motor Vehicles Act mandates that car owners compulsorily purchase insurance coverage against third parties. Driving around without one is a legal offence.
Car insurance policies cover damages that may occur due to natural calamities, man-made calamities, provide personal accident cover and third-party legal liability. Most policies are valid for one year and can be renewed annually.
One can choose the right policy and premium amount depending on personal requirements, the type of car owned and the type of protection required. It is important to make an informed choice before purchasing a policy and compare the different policies in the market. There are different types of policies available to suit different needs and each policy comes with a number of add-on features like towing facility, key replacement or cover for loss of personal belongings. These add-ons come with an extra fee.
Comprehensive car insurance cover- A comprehensive car insurance policy provides wider and complete coverage to any kind of damage that may occur. Liability insurance or collision insurance will cover only road accidents but this kind of policy will also protect you in cases of theft, damage caused due to natural calamities, animal collision, riots etc . However, premiums may be higher due to the vast scope of coverage offered.
Third-party liability- This kind of insurance policy covers losses that may incur due to damage caused to the property of a third-party. In India, it is legally mandatory to purchase a third-party insurance policy with a certain minimum coverage amount.
Before purchasing a car insurance policy, it is important to do some research, compare and analyse the best policies available in the market and make a good choice. The key is to compare the main coverage features provided by insurers, check and review add-on riders and premium costs. It is always wise to use an insurance premium calculator to get different insurance quotes. It can get quite confusing and tricky but it is important to be cautions because a wrong decision will cost you a heavy premium and you may end up with not-so-great coverage options.
Here are a few factors that you need to look into before purchasing a car insurance policy:
|Company||Third-Party Cover||Claim Ratio||Special Features||Cashless Claim|
|Bajaj Allianz Car Insurance||Upto Rs.7.5 L||72.07%||
|Hdfc Ergo Car Insurance||Upto Rs.7.5 L||85.8%||
|Reliance Car Insurance||Upto Rs.7.5 L||87.3%||
|Royal Sundaram Car Insurance||Upto Rs.7.5 L||82.78%||
|Tata Aig Car Insurance||Upto Rs.7.5 L||83.74%||
Step1 – The first step is to call your insurance company immediately. In case of an accident, also report it to the police as soon as possible.
Step 2- Raise a claim request and provide relevant details and documentation as asked by your insurance company.
A cashless claim process is when an insurer wants to avail repair services from network garages covered under the policy. Insurers usually have a cashless network of garages that provide repair services to policyholders. In this case all expenses will be taken care of under the cashless claim feature and the user can get his/her car repaired in any of the registered garages that the insurance company is tied up with.
Following are the steps to make a cashless claim:
If you meet with an accident and incur expenses towards repairs or medical expenses, the same will be reimbursed by the insurance company after the proof for the same is provided. It is important to keep records of all expenses made and submit those documents while applying for a reimbursement claim.
Initially, cashless settlement process was usually provided for health insurance policies, but off late, this option can be availed even for car insurance policies. Today, there are numerous insurance companies that offer policyholders the option to apply for cashless claims through the wide and comprehensive cashless network of car garages across India. Most insurance providers tie up with garages in different cities to provide this service. Policyholders can avail this benefit by handing over their cars to the closest garage in their locality for repairs. The owner of the car can get his/her car repaired from any of the listed network garages. The bills and payments towards the repairs will be paid to the garage by the insurance provider and the customer does not have to pay from his own pocket.
Most car insurance companies in India partner with a set of well-known garages that offer repair services to their clients. Policyholders will usually be given a list of these network garages and be informed of this facility while purchasing the insurance policy. Information about the specified list of network garages in each city will also be available online, through help desks or insurance agents.
In the case of an unfortunate occurrence like an accident, the holder of the policy can make a claim through the cashless network for repairs to damages. Once a claim is made under this method, the insurance provider will approve the request for the service.
This has come to become a very hassle-free and quick method to resolve issues and get the car repaired. The following are the advantages of cashless network garage services:
However, there are a few disadvantages to this process of claim settlement:
A car insurance premium calculator provides a probable premium cost for a particular type of policy. This tool will give prospective policy buyers the scope to calculate their premiums based on their preferences and add-on cover options that they might choose. This can also be used to calculate premiums while renewing policies.
With this, a buyer can explore different premium options, coverages provided and insurance quotes can be obtained from different policy providers online. This is a quick and easy tool that helps buyers make the right choice in a short span of time.
The following are the benefits of a car insurance premium calculator:
Premium = Own Damage Premium - (No claim bonus + discounts) + Liability premium as mandated by IRDA
Refer to the below sample table to understand how premium is calculated:
|Year of manufacture||2012||Comprehensive policy with no claim bonus|
|Ex showroom price||Rs.4,16,000|
|Depreciation in %||20%||Rs.83,200|
|Insured declared value||Rs.3,32,800|
|Own damage premium||1.970%||Rs.6556|
|Total OD premium||Rs.5425|
|Personal accident cover||Rs.100|
|Legal liability paid to driver||Rs.50|
|Compulsory third-party cover||Rs.1110|
|Service tax @ 14%||14%||Rs.911|
According to a data by Kotak General Insurance for a duration of one year from July 2017 to July 2018, it has been found that women make fewer motor claims which makes it profitable for insurance companies to have more women as customers.
The loss ratio during the period was 46.94 per cent as compared to 60.69% for men.
The claims ratio for petrol and diesel cars bear similar results for women and men. The data clearly shows that for every 100 rupees of premiums paid, men claimed Rs.70 while women claimed only Rs.48 for diesel cars. For petrol cars, the loss ratio for men was 53.59% and 46.30% for women.
9 April 2019
*The customer reviews/feedback/opinions expressed on this website are solely of their authors and do not reflect, in any way, the view of BankBazaar Insurance.
Display of any trademarks, tradenames, logos and other subject matters of intellectual property belong to their respective intellectual property owners. Display of such IP along with the related product information does not imply BankBazaar's partnership with the owner of the Intellectual Property or issuer/manufacturer of such products.