Availing third-party insurance is mandatory under the Indian Laws because it protects the third-party if a car meets with an accident. However, who fall under the third-party category? The two parties involved in an insurance plan are the insurance provider and the policyholder. The third party is the one against whom an accident has occurred. These can either be an individual walking as a pedestrian, any one of the passengers in another car, or any property damage.
Such insurance is compulsory because it covers for other damages done by you or your vehicle. However, it doesn’t provide coverage for any damages done to your life or property. Hence, to ensure your own damages, you can purchase comprehensive car insurance which covers both third-party and personal damages too.
Things You Might Not Know About Your Car Insurance Coverage
- No Claim Bonus is a discount on the payable premium which you can avail if you make no claim for a year. This bonus keeps increasing with every year in which you don’t make a claim. It means if you have not made any claim in the first year and you get a 15% discount on premium, it can increase up to 20% in the next claim-free year. The maximum limit of NCB you can avail is up to 50%. However, if you make a claim after two years in the third year, the NCB would become null.
- Deductibles are the amounts which insurance companies estimate to pay to the policyholder in case of any claims. However, you have the option to raise these deductible amounts which will eventually decrease the premium amounts.
- You can also transfer all the added benefits like NCB from either one car to another, one policy to another, or an insurer to another.
- You can also avail a Zero Depreciation cover which settles your claim without considering the depreciation. Since the value of the car decreases every year, hence a zero depreciation cover can offer you the benefits of not paying any amount from your pocket. However, the premium would be a little higher than other normal policies.
- Insurance companies also offer a separate cover for providing coverage to the different accessories like music player. The premium for such covers would be higher. Apart from that, you can also ensure the engine of a car in case it gets damaged due to an accident. With all of this, you can even get insurance for the lost ignition key. The replacement of key is an expensive affair because it needs to be properly accustomed with the make and model of car. It can take up to ten days. With insurance, you get coverage for replacing the key and even installing new locks in the car, if required.
- If you have more than one vehicles in your household, buying a separate policy for each one should be avoided. Instead, you can bundle up all your insurance policies in one and pay only one premium which would include all the premiums.
- While insurance policies cover engine and accessory breakdown, they don’t provide coverage for any electrical or mechanical breakage. It means if an accident is caused by a short-circuit due to electricity damage, the damage won’t be covered under it.
The driver of the car is covered under personal accident cover which comes as an add-on with the insurance policy. Apart from that, it also covers the risks associated with the other passengers seated in the car. Hence, if you are not driving your vehicle, you need to buy insurance for the driver of your car. It can be bought as comprehensive car insurance which would provide entire coverage for damages.