Reasons Why Car Insurance Is Important?
Published On Aug 25, 2021
Car insurance is not just a legal requirement but also a necessity for car owners. Read to know the reasons why car insurance is important.
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With more vehicles on the road, the events of road accidents are increasing at an alarming rate. The repair expense can cost dearly to many car owners which is difficult to bear. Car insurance is essential to cover a major to minor loss suffered by the third party for their injuries, death and property damage. To cover the own-damage expenses, one needs to pick a comprehensive cover, otherwise, the car owners will have to bear the repair costs on their own. In addition, to get coverage, there are multiple reasons to opt for car insurance.
Reasons Why A Car Insurance Is Necessary?
Below given are the reasons which make it necessary to own car insurance for policyholders:
1. Mandatory As Per Law
According to the Indian Motor Tariff, it is compulsory for all car owners to own at least a car insurance policy while driving in India. The third-party cover is the basic car insurance plan which covers only the financial liabilities that you may incur towards a third party. Since, it is a legal requirement to carry at least a third-party policy, therefore, failing to carry it while driving can get you penalised with fines and imprisonment.
2. Coverage For Damage
A car insurance plan whether a third-party insurance plan or comprehensive insurance policy gives coverage for damage or loss caused due to an accident or a mishap. A car insurance cover can help you save a lot from spending to cover the losses. While a third-party policy covers only your liability towards a third party, a comprehensive insurance plan compensates your damage or loss sustained by your car, you and co-passengers.
You may also like to read: Personal Accident Car Insurance Coverage: A Handy Guide
3. Covers Third-Party Liability
With the help of a third-party car insurance policy, you can get coverage from your insurance company for damages caused to a third-party due to an accident with the involvement of the insured car. In simple terms, The third-party car insurance plan can save you from legal issues as well as liability towards the other party in relation to an accident sustained by your car as it compensates for the damage or loss of the third-party involved in the collision.
4. Replacement In Case of Theft
Car theft is big trouble for every car owner, especially, if you have a costly car. It brings a huge loss which is not possible for everyone to bear. A comprehensive car insurance policy comes with the benefit to cover your loss in case your car gets stolen. In such events, the inusrance company tends to provide compensation for the loss of the car considering it a total loss. Generally, in such situations, an amount equal to Insured Declared Value (IDV) is provided.
5. Compensation for Family
If an unfortunate event of your demise is an accident or a mishap, then your beneficiary or nominee as declared in the policy will become entitled to receive the compensation. In case your family is dependent on your income, in such a case, your insurance provider will make sure to provide your family with day to day expenses after your accidental death. This can be received with a comprehensive car insurance policy and with the basic cover.
People invest a lot of time in selecting and purchasing a car. With the same earnestness, they should buy a car insurance plan. But many people do not do that as they are unaware of the importance and benefits of car insurance. Hence, the law makes it a compulsion for every car owner to at least purchase a third-party insurance plan. However, we have tried to present a few reasons due to which you should own car insurance without fail.
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.