For vehicle owners in the country, having a car insurance policy is not just mandatory but is a requirement. Without one, following an accident, the car owner will have to pay for the damages caused to his/her car and the damages caused to the third-party from his/her own pocket. In such an instance, the car insurance policy kicks in and the claim amount which is subject to the Insured Declared Value (IDV) of the car will cover the cost of damages. That said, the coverage to cover the repairs of damages of the vehicle is limited on whether the policyholder has a third-party car insurance policy or a comprehensive car insurance policy.
A third-party insurance policy is often held by more car owners in the country as it is mandatory as per the Motor Vehicles Act, 1988. However, it is limited as it offers coverage only for damages caused to the third-party involved in the accident. On the other hand, a comprehensive car insurance policy is not mandatory but comes with the third-party liability feature as well as the own damage cover. The comprehensive car insurance policy offers damage coverage not just for accidents, but if the car is damaged following a fire, a natural calamity or if the car is stolen.
When it comes to choosing an insurer to purchase a car insurance policy, one of the most important factors to consider is the cashless network garage of the insurer. If the insurer has a wider network and inclusive of reputed garages, then the customers make the obvious choice of purchasing a car insurance policy from that particular insurer. That said, let’s look into the importance of cashless network garages and the benefits.
A network garage is one that has tied up with an insurer. If the garage is in the area of the policyholder, he/she can get his/her car repaired at the network garage and the cost of the services will be settled between the network garage and the insurer – cashless settlement. Now, insurers are considered reputed if they have a wide network garage, which means that once the policyholder raises a claim, he/she can take the car to the network garage and avail the benefit of the cashless claim settlement – that will be taken care of between the insurer and the network garage. Some of the benefits of a network garage are listed below:
As the name suggests, cashless claims do not require the policyholder to pay for anything for coverage of damages to the car unless the repairing expenses exceed the Insured Declared Value (IDV) of the car. If the cost of the repairs of the car is within the IDV, then apart from the involuntary deductible amount which is mandatory to be paid for every claim, the policyholder will not have to pay anything. A cashless claim is basically when the expenses of the damages are taken care of between the insurer and the network garage. Listed below are the steps policyholders need to take to make a cashless claim:
When purchasing a car insurance policy, there are two types of deductibles – compulsory deductibles and voluntary deductibles. Compulsory deductible is the amount that the policyholder will have to pay for every claim that he/she makes. On the other hand, as the name suggests, the policyholder can opt for the voluntary deductible option. This means that the policyholder will decide an amount that he/she will pay for every claim. By opting for the voluntary deductible option, the premium of the car insurance policy will be reduced significantly as the policyholder has agreed with the insurer to share the expenses to repair the damages caused to the car.
When making claims, policyholders have to be aware of the depreciation value of their car or the Insured Declared Value (IDV). The IDV is basically the current market value of the car or the depreciation factor, and for example, for a car that is less than 6 months old, the IDV stands at 5% and increases to 50% of the value of the car by the time the car is 4-5 years old. This means, if the policyholder makes a claim when the car is already 4 years or more, the value of the car will be 50% of what it was when it was bought. To negate the effect of the deprecation value of the car, policyholders can opt for the zero-depreciation add-on cover which will allow the policyholder to receive the entire claim amount. However, most insurers only offer the zero-depreciation add-on cover for vehicles that are less than 2 years old.
If by chance the policyholder gets his/her car repaired at a garage that is not a network garage of the insurer or is not listed by the insurer, then the policyholder cannot make a cashless claim. Instead, the policyholder will have to opt for the reimbursement claim settlement. For this, the policyholder will have to pay for the damages caused to his/her car and then submit the bills to the insurer for a reimbursement. The insurer will reimburse the amount subject to the current IDV of the car or if the amount is less than the IDV, then the whole coverage for the repairs will be reimbursed.
You should inform the insurer as soon as the accident has taken place. You could also take the car to the nearest network garage and they will raise the claim on your behalf once you have submitted all the required documents.
Every insurer has the network garage locator on their website. Depending on your location, the network garage locator will guide you to the closest network garage. If you cannot move the car, the network garage and insurer will arrange for a tow truck to get it there.
Yes, this one of the main advantages of choosing an insurer with a wide network of garages because if your car breaks down the nearest network garage will have your car serviced.
Yes, they do. You’ll be given a guarantee for a certain period.
You would have been asked to pay for the compulsory deductible amount or if your claim amount has exceeding the IDV of your car.
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