Type to search

Everything First-Time Car Buyers Need to Know About Car Insurance in India

Share -

Purchasing your first car is an exciting milestone, but it also comes with a set of responsibilities. One essential aspect of car ownership in India is having the right car insurance. Car insurance not only safeguards your investment but also provides you with financial protection in case of unforeseen events. If you’re a first-time car buyer in India, here’s a comprehensive guide to help you understand the ins and outs of car insurance.

1. Types of Car Insurance Policies
In India, there are primarily two types of car insurance policies:

– Third-Party Liability Insurance : This is a mandatory policy that covers damages and losses caused to a third party involved in an accident with your vehicle. It does not cover damages to your car.
– Comprehensive Insurance : This is an extensive policy that covers both third-party liabilities and damages to your own car. It also includes coverage for theft, fire, natural disasters, and personal accident benefits.

2. Factors Affecting Premiums
The premium you pay for car insurance is influenced by several factors:

– Car’s Make and Model : The value and specifications of your car impact the premium. High-end cars generally have higher premiums.
– IDV (Insured Declared Value) : This is the maximum amount the insurer will pay in case of a total loss or theft. The premium is directly related to the IDV.
– Age and Gender : Younger drivers may have higher premiums due to higher perceived risk. However, some insurers offer discounts to female drivers.
– Location : The city you live in affects your premium due to factors like traffic density and theft rates.
– No Claim Bonus (NCB) : If you don’t make a claim during a policy year, you’re eligible for an NCB discount on your next year’s premium.
– Add-On Covers : These optional covers, such as zero depreciation, roadside assistance, and engine protection, enhance your coverage but increase the premium.

3. Understanding Deductibles
Deductibles are the amount you agree to pay out of pocket when filing a claim. There are two types: compulsory and voluntary deductibles. Opting for a higher deductible can lower your premium, but you should be prepared to pay more in case of a claim.

4. No Claim Bonus (NCB)
The NCB is a reward for safe driving. It accumulates each year without filing a claim and results in a premium discount. If you’re switching insurers, you can transfer your NCB to the new policy.

5. Claim Process
In case of an accident, follow these steps to file a claim:

– Inform the Insurer : Inform your insurer about the incident as soon as possible.
– Register a Police Complaint : In case of theft, major accidents, or injuries, file a police complaint.
– Document the Damage : Take photos and gather evidence of the damage or accident scene.
– File the Claim : Fill out the claim form provided by the insurer and submit all required documents.
– Survey and Inspection : The insurer might appoint a surveyor to assess the damages.
– Cashless/Reimbursement Claim : You can opt for a cashless claim if you use a network garage. For other garages, you can opt for reimbursement.

6. Comparing and Choosing Insurers
Don’t settle for the first insurance policy you come across. Compare policies from different insurers to find the one that suits your needs and budget. Look at coverage, premiums, claim settlement ratio, customer reviews, and the availability of add-on covers.

Car insurance is a crucial aspect of owning a car in India. As a first-time car buyer, understanding the types of policies, factors affecting premiums, deductibles, NCB, and the claim process is essential. Adequate research and consideration of your driving habits and needs will help you select the right car insurance policy to protect your investment and ensure peace of mind on the road.