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Factors to Consider While Buying A New Car Insurance in India

Published On Dec 28, 2020, Updated On Mar 20, 2021

A car insurance policy is a vital coverage that the car owner has to think about while purchasing a car. In cases of loss, a proper insurance policy allows the owner to claim compensation. Any car owner must have at least a mandatory third-party car insurance policy, as per the guidelines of the Indian Motor Tariff, 2002.

In India, a car insurance policy is bought by most car owners because it is a necessity. In general, people do not compare car insurance policies and base their purchase decisions on the low cost of the premium. This often relates to getting insufficient coverage.

Factors to Consider While Buying A New Car Insurance in India

Factors to Consider While Buying a New Car Insurance

The following tips will significantly help you compare the insurance and make the right choice

1. Brand Reputation: An insurance company's brand image is a critical consideration that you can remember when buying a car insurance policy. If you prefer a car insurance firm that has a strong reputation on the market, so in contrast to the lesser-known firms, the likelihood of it fulfilling its commitments on time will be high.

2. Coverages: The effectiveness of every car insurance policy depends on the benefits it gives to the owner of the vehicle. Before buying a car insurance policy, you must always review and compare the benefits provided by different plans. While a third-party car insurance policy only protects third-party liability - collateral harm, physical injuries and death caused by an insured car to a third party, a comprehensive car insurance policy offers, in addition to third-party liabilities, provisions for own damage sustained by the insured car.

3. Premium Amount: It is important to consider the car's needs well in advance and the possibility of risks when deciding the premium rate. Comparing quotes from different insurers will also allow them to make the best decision according to criteria and affordability.

4. Claim Settlement Ratio (CSR): Customers can review the background and claim settlement ratio of the company as well. When buying a car insurance package, an insurance provider with a poor claim ratio is not advisable,

5. Add-on Covers: The add-on covers or the riders are the additional covers that you can obtain above and over the basic insurance policy protection offered. As per your personal specifications, you can pick any additional cover you want and configure your policy.

6. Network of Garages: Your insurance company's network garages provide cashless car repair services for physical harm caused by the car within the period of the car insurance policy. Thus, you need to check how wide and strong the cashless garage network of the insurance provider is when purchasing a car insurance contract.

7. Insured Declared Value: If your car is damaged beyond any repairs or if your vehicle gets stolen, the insured declared value or the IDV is the amount that the insurance provider can pay. You could be given a separate IDV by different insurance providers. It is important that you determine the actual market value of the car before checking the IDV of the car.

Bottom Line

The purchase of car insurance must be given equal priority as the purchase of a car itself. So, if you buy a vehicle, before making a buying decision, you must be aware of the various aspects of car insurance and compare the different options available on the market. Understanding the complexities of car insurance will help you get ample coverage and receive better coverage if you are a first-time car insurance customer.

Also Read: Basic Car Maintenance Tips Every First-Time Car Owner Should Know

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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