buy car insurance for new car

Pros And Cons Of Buying Car Insurance From A Car Dealer

27th January 2020 8min read 7443 views

So, you’ve finally decided to buy a new car. Congratulations! After months of test drives, careful saving and yes, arguments with family members, you have managed to find the car of your dreams. But, how are you going to protect it? In India, according to the Motor Vehicles Act, 1988, it is mandatory to have at least third-party insurance before you can lawfully drive your car on the road. Thankfully, most car dealerships will throw in an insurance policy with third-party cover, personal accident cover, and cover for the owner-driver as well when you buy a new car from them. If you’re wondering if the policy they’re offering is the best fit for you and your car, we’re here with a few answers.

Pros of Buying Car Insurance from Auto Dealer

1. Simple Process

The best part of getting new car insurance from your car dealer is the simplicity of the process. Your car dealer will provide you with some policy options from insurance providers that they have enlisted, and all you have to do is pick your favourite from the lot. You also don’t have to worry about getting the policy delivered to you since it will be hand-delivered along with your car.

2. Bundle Offers

If you opt to buy new car insurance along with your car from the dealer, you may get a deal for a 3-year policy. This could mean more affordable premium options and fewer renewal formalities every year.

Cons of Buying Car Insurance from Your Auto Dealer

1. Fewer Options

In all likelihood, your car dealer would have tied up with a handful of insurance companies and will offer you policies from them. This limits your options. If you were to opt to purchase your own insurance policy, you can compare features and costs from a wide range of companies before selecting the right policy for your needs.

2. Price Points

There’s no guarantee whatsoever that the policy and price your car dealership is offering is the best in the market. In fact, if you compare policies by yourself, you could find a more suitable option.

3. Cover Concerns

The car dealership may include add-ons or voluntary excesses without your informed knowledge. If you’ve decided to take the policy your dealer is offering, it’s advisable to read the policy documents and all the fine print very carefully.

4. Limited Customisations

Depending on how you intend to use your car, you may need to customise the kind of cover you’re purchasing. In most cases, you will not be able to choose the covers you want under the policies offered by car dealerships. This can have a serious impact on your finances later on.

The Verdict?

There isn’t a single right answer to the question – Is purchasing car insurance for a new car from my dealer a good idea? This is because different people have different insurance needs. In some cases, the policy offered by your car dealer may be adequate and in other cases, it may not. When you decide to purchase a car, you’ll have to look at the options your dealer is providing and decide whether or not these offers are what you’re looking for. Before you make a decision, it’s always a good idea to do a little research to see what else is available in the market and check whether you can purchase the kind of cover you need for a better price. With the online insurance process, purchasing a policy has become incredibly easy and requires just a few easy clicks!

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