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Common Mistakes to Avoid While Buying or Renewing Car Insurance

Published On Jan 21, 2021, Updated On Mar 20, 2021

It is important to perform enough ground research and compare various plans before buying a car insurance policy. There are also few mistakes to avoid such as adding unnecessary add-ons and not comparing policies, to achieve an optional return on investment.

It is mandatory to have a valid insurance policy for the car to avoid legal and financial battles. But it should not be bought with eyes closed, just because the law mandates it. It is important to perform basic online research before investing in a policy. Wise policy seekers will research the credibility of the provider and the features of the policy before leveraging on a plan.

What To Avoid While Buying or Renewing Car Insurance?

Some common mistakes that are made while buying car insurance plans can be detrimental. Understanding common mistakes help vehicle holders to make wise and informed decisions. Some of these mistakes are as follows.

1. Failing to Compare Policies:

It is essential to compare policies online and choose the one that offers the best deal. It is important to put one’s analytical mind into complete use while scrutinizing the policy. Never go for a plan, just because it has cheap premiums, as the plan can compromise on coverage and features. Comparing plans will always help in getting the best plan at a wise cost.

2. Settling for Plans with Minimal Coverage:

As the law mandates car owners to have at least third-party Car insurance, it doesn’t mean that one has to take a policy with minimal coverage. These plans will only cover damages for third parties and not for themselves and the car. No claims can be filed for damages from natural disasters or calamities. Thus, it is always beneficial to go for comprehensive car insurance for wider coverage.

3. Not Considering Deductibles:

Deductibles are additional costs that the policyholder agrees to pay while raising a claim. Deductibles are of two types namely compulsory deductibles, which are part of the insurance policy, and voluntary deductibles, which the policyholders agree to pay while raising the claim. Voluntary deductibles allow a smaller premium while purchasing the insurance policy. It is better not to opt for voluntary deductibles as it might result in a less premium but can be detrimental while raising a claim.

4. Choosing Unwanted Add-Ons:

Though the policy add-on covers will add more value to the policy, some of them will only add to the cost of the policy, without actually contributing to mitigating the risk. Thus, it is important to choose add-ons wisely to reap the maximum benefits from them.

5. Not Sharing Appropriate Information:

It is important to share only relevant and truthful information with the car insurance company while purchasing a policy. The policyholder has to be transparent while disclosing information, as insurance is based on mutual trust. Misleading and incomplete information can result in claims rejection and invite unwanted legal troubles.

6. Not Renewing Policy Before Due Date:

Failure to renew the policy before the due date might result in the policy getting lapsed and rejection of the car Insurance claims settlement.

Also, Read

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Bottom Line

For maximizing the benefits of an insurance policy, it is important to understand its terms and implications thoroughly. Any doubts about the policy can be settled with the support team of the insurer. And the best way to buy an optimal insurance policy is to compare different plans, before leveraging on one.

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.

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