Car Insurance is mandatory by law. Driving around without valid car insurance is illegal in India.
In India, nearly 4 lakh people meet with accidents every month. Fatalities in road accidents in India are moving up at a compounded annual rate of four per cent. Considering the high number and the poor state of roads, Motor insurance is a necessary requirement. By law, Motor Insurance is mandatory. Motor Insurance provides financial cover not only to you but also covers damages to third party (people travelling with you). Motor Insurance also protects you from losses arising from natural calamities like cyclone, earthquake etc.
1. Third party: - As per law, it is mandatory for every vehicle owner to take Third Party Cover.
Any injury/death of a third person and/or damage to his/her property - on account of any accident caused by your vehicle - is covered under Third Party Insurance. It also includes compulsory personal accident cover for the owner-driver.
However, it does not cover any damage to your vehicle.
2. Comprehensive car insurance: - As the name suggests, offers overall protection against damages to your car that are the result of incidents which is unrelated to an accident/collision. This scheme is extensive and it covers damages to car, theft, legal liability to third party and cover for personal accident cover.
The Comprehensive policy coverage can be
further improvised by opting for add-ons features like
1. accessories cover,
2. engine protector,
3. ZERO DEPRECIATION COVER,
4. Medical expenses, etc.
This coverage is highly popular since it offers end-to-end coverage and hence ensures less stress for the policyholder.
BENEFITS OF COMPREHENSIVE POLICY
theft, fire, natural disasters like a hurricane or a tornado, vandalism, falling objects, Damage done to your car by animals, civil disturbance, like a riot that results in damage or destruction of your car.
· Aging, wear and tear, etc. of the vehicle
· Electrical or Mechanical breakdown
· Damage to tyres and tubes. However if the vehicle is damaged at the same time, liability of the company will be limited to 50% of the replacement cost.
· Damage caused by a person driving without a valid license.
· Damage caused due to drunken driving or driving under the influence of drugs.
· Loss/ damage caused by war, mutiny or nuclear risk.
Vehicle insurance is portable. In other words, you can change your insurer without losing the benefit of any no-claim bonus that you may be eligible for.
NO CLAIM BONUS
One of the most best options to save premium is the facility of no-claim bonus (NCB), whereby you get a discount in your premium if you haven’t made any claim in the previous year. Moreover, this discount increases with each successive year of zero-claim and goes up to, as high as, 50%. Since this benefit is available year after year, one should avoid making any small claims.