Nothing quite beats the joy you feel when you buy a car for the first time. But once you’ve selected the make, model and customisations, you also need to think about getting car insurance. In India, you need to have at least third-party insurance coverage to drive around legally. If you’re for the first time, you may feel overwhelmed by the different types of insurance policies available in the market. Each company offers add-ons and other benefits. Before you make this all-important purchase, here are a few things you must consider:
The Legal Jargon
If you’ve never purchased car insurance before, take a moment to get familiar with the jargon used. You will come across terms like third party, own damage, car insurance with zero depreciation and Insured Declared Value (IDV), etc. Understanding what they mean will enable you to make an informed decision about your car insurance policy.The IDV refers to how much your car is worth at that time. If you’ve purchased a new vehicle, it will be very close to the price. Over time, the value depreciates, so the IDV reduces as well. The IDV is the maximum amount your insurance provider will pay if your car is damaged beyond repair or stolen. To reward you for getting through a policy year without making claims, your insurer offers a No Claim Bonus (NCB). Understanding every term in the policy documents helps you prepare for every situation in the future.
Types of Insurance Policies
There’s more than one type of car insurance available in the market. For example, you can opt for a third-party only policy. If you do, your insurance provider will only cover the costs for damages to another person or their property. Any damage to you or your vehicle does not fall under the policy. If you’d like to protect yourself and others, you can opt for a comprehensive car insurance plan instead. Such a policy covers both third-party and own damages to you and your vehicle. If you intend to use the car for your business, you need to get commercial car insurance. Understanding what you require will enable you to get the right kind of policy.
Every insurance provider offers a range of add-ons that you can choose from to enhance the coverage of your car insurance plan. At Edelweiss General Insurance Company, we have over eight add-ons that bump up your coverage. Remember that you do not need to pick all the add-ons available. Only select those optional covers that make sense for you and your vehicle. Every add-on that you choose will impact your premium amount.
Most often, you can buy car insurance online for just one year. But, many insurance providers today also offer policies that are valid for two years or more. When you opt for a longer tenure, you might enjoy a small discount on the overall premium. But, you run the risk of forgetting when your car insurance renewal is due. If you miss renewing your car insurance policy on time, you may end up driving without any cover. Ideally, set a reminder to renew your car insurance online. You can complete the entire process within a few minutes to enjoy continued coverage.
Purchasing car insurance for the first time shouldn’t be difficult. Once you become familiar with the jargon and understand what your insurance provider is offering, you can choose the right policy for your needs.