10 Common Car Insurance Terminologies You Must Know About
Updated On Oct 17, 2023
Before buying a vehicle insurance policy, familiarise yourself with the most frequent car insurance terminology.
Table of Contents
Due to a lack of information on particular words specified in the car insurance policy document, most car owners buy a car insurance policy based on its coverage and premium but do not grasp its terms and conditions. As a result, using the policy becomes more difficult. As a result, before acquiring a vehicle insurance plan, it is advisable to familiarise yourself with the most prevalent car insurance dictionary words. To help you make an informed decision, let's look at some of the most common phrases related to vehicle insurance.
Terms Commonly Used
Among the often used terms are:
Covers with Add-ons
Additional insurance coverage, known as add-ons or riders, can be purchased in addition to a Comprehensive Plan. These plans are not available as a standalone cover or in combination with a Third-Party Plan. Coverage or service-related add-on covers are also possible. A Zero Depreciation Add-on, for example, is more of a coverage-enhancing add-on, whereas a Roadside Assistance Add-on is a service-related add-on. In your Comprehensive Car Insurance policy, you can choose one or more add-ons. Please keep in mind that any add-on will increase the total amount due. As a result, only add-ons that offer value should be purchased.
Device Against Theft
An anti-theft device is a piece of equipment that may be fitted in your car to prevent theft. These gadgets can set off an alert and/or have a built-in GPS that allows them to be tracked. Consider installing anti-theft gadgets that have been approved by India's Automotive Research Association (ARAI). Installing such systems improves the safety of your car and reduces the likelihood of theft. The insurer's risk of insuring the car decreases as the probability of theft decreases. The payable premium might reflect this. Talk to Customer Service about getting a discount on your car insurance if you have an anti-theft device installed.
Insurance for Break-Ins
When there is a significant gap between two insurance policies, it is referred to as "break-in insurance." Break-in Policies are another name for this type of policy. If you have such coverage, the insurer may want to check the car before renewing it. The premium may rise as a result of this. To ensure that there is no gap between plans, it is recommended that you renew the insurance before the expiration date. Additionally, if the break is longer than 90 days, the earned No Claim Bonus may be reset to zero, resulting in a higher premium upon renewing the policy.
When it comes to claiming settlement, you must donate a certain portion of it as well. The Compulsory Deductible is the amount that must be deducted. This is a pre-determined component determined by the Insurance Regulatory and Development Authority of India based on the cubic capacity of the vehicle's engine.
Third-party (TP) and Own Damage (OD) coverage make up a Comprehensive Car Insurance policy. OD + TP cover is another name for it. With this strategy, you can satisfy legal requirements with the TP cover while also protecting your car from harm with the OD cover. When purchasing or renewing Comprehensive Car Insurance, you also have the option to add-on insurance to expand your coverage.
When researching, comparing, purchasing, renewing, or claiming vehicle insurance, you will come across a variety of terms. This Car Insurance Glossary will assist you in deciphering these terms so that you can make an educated decision. It should be noted that the explanation of automobile (vehicle) insurance terminology is simplified for ease of comprehension and is not intended to be taken as a legal definition.
You may also like to read - Understand Why Car Insurance Is Mandatory In India
Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.