If you are looking for car insurance, it means you have recently purchased a new car. According to the Motor vehicle Act of 1988, it is mandatory to get third-party vehicle insurance as soon as you get a car (old or new). Your car’s insurance helps you keep your car safe in case of any unforeseen accidents.
For some, a vehicle insurance policy might seem like a burden. However, it is not. It may cost you a little bit more, but it is worth it. This is because it will save you from the enormous costs you might have to bear in times of mishap or casualties. Hence it is important to buy a comprehensive car insurance plan to ensure you are covered by all the expenses that might cost you a fortune.
You must choose the right insurance company to choose the right insurance plan. To make things easier and help you pick the right insurance company, we have curated a list of factors you must remember while browsing insurance provider websites.
What is a car insurance plan?
A car insurance plan is a contract between you and the insurance provider, who promises to pay for your loss incurred due to several factors such as – theft, accident, natural disaster, and many more. They pay the loss amount in exchange for premiums you need to pay every month or year for the assured sum.
What are the types of car insurance policies?
Before buying a car insurance policy, you must understand the types of insurance offered by the insurance providers –
1. Third-Party liability car insurance
Third-Party liability car insurance helps you cover the financial liabilities that might arise due to damage or loss to third-party property or if any death or injury is involved in an accident with the insured vehicle.
This insurance policy covers the following –
- Damage to the third-party vehicle
- Personal accident (protects you in case you are involved in an accident)
- Injury or death of the third person in an accident involving your car.
2. Comprehensive car insurance
The comprehensive car insurance policy helps you cover vehicle damage and third-party damage loss.
The following are covered under this policy –
- Loss and damage to the third party (injury, death, or vehicle damage)
- Personal accident cover
- Car theft
- Damage due to natural calamities, fire, etc.
How to choose the right car insurance company?
Several insurance bodies are registered under IRDAI – a regulating body of insurance. With so many options, finding someone who can help you with all that you need might be difficult. Below are some points to consider before picking an insurance company –
1. Claim settlement ratio (CSR) and process
A CSR or the Claim Settlement Ratio is the number of claims settled by the car insurance company against the number of claims raised. You must always check claim settlement ratio first when choosing an insurance Company. The higher the CSR higher is the chances for your claims to be settled with that company.
An ideal CSR of an insurance company must be above 90%. Also, the claim settlement process should be easier and not create a hassle.
2. Customer service
Customer service is one of the important factors you must always consider while choosing an insurance company. This is because if you are in a situation where you need the help of the insurance provider, you will call their toll-free customer service to seek help.
In that case, if you do not receive a positive reply or your issue has not been resolved, what would be the use of buying insurance from that company? So, always analyse the credibility of the insurance provider in terms of customer feedback on their website.
3. Understanding the insurance company
Understanding the insurance company means going through every possible detail, as once you buy the insurance, it will be a minimum of one year, and in that one year, a lot can happen. Be a smart buyer and know the company’s financial health along with its past, present, and future plans. Also, read the terms and conditions before finalising any deal.
4. Comparison is the key element
The insurance market is flooded with options which might confuse you. This is because every insurance company offers different features and benefits to their customers. So, it is better to jot down a few names of the best insurance providers in India.
Look for the details such as CSR, customer reviews, the premiums they offer, the inclusions and exclusions (for the policy you require). Also, the best part is that you do not have to go to all the insurance companies physically. You can do it online.
5. Network garages
Network garages mean the garages have tie-ups with the car insurance providers from where you can avail of the services you require without paying any cash. Look for an insurance provider who has network garages and offers cashless facilities. This eliminates the need for you to pay cash.
6. IDV (Insured Declared Value)
Look for an insurance company that can customise the IDV value to maximise the benefits of the policy. IDV means the maximum sum assured decided by the insurance company, which is provided to you upon vehicle theft or damage. In other words, we can say that IDV is the price of your car as per the manufacturer minus the depreciation.
With the above tips, you can make an informed decision to pick the best car insurance provider to cover you in the best possible manner. As we know, vehicle insurance is not a burden but a necessity.
So, keeping all the factors in mind, choose the best suits your needs and cover your losses without you being annoyed and frustrated. While you must have a third-party liability coverage, it is best recommended that you buy a comprehensive car insurance policy to provide you all round protection to your car.
Disclaimer: The above information is for illustrative purposes only. For more details, please refer to the policy wordings and prospectus before concluding the sales.
Also read: Why Do You Need Insurance for a Used Car?