All you need to know about car insurance: overview, types, and benefits

Car insurance is the perfect cushion against the everyday perils of driving on Indian streets. Having car insurance gives you peace of mind, and helps you drive without hesitation. It protects you against all sorts of unforeseeable events such as accidents, theft, damages caused by natural calamities, etc. The government of India has made it mandatory for all the vehicle owners to insure their car to drive on the Indian streets. The two major types of insurance policies for your car are third party car insurance and comprehensive cover. Other than these two, there are also a variety of add-ons available in the market, to help with your decision.

What are the different types of insurance policies for a car?

The different types of insurance policies for your car are here as follows:

  1. Third-party cover: This is the most basic type of insurance policy available in the market. The Indian government has made it mandatory for all the vehicles to have third-party insurance cover. Thus, without this cover, no vehicle owner can drive their car or any other motor vehicle on the Indian streets. This car insurance policy covers all the damage caused by you to the third-party; however, it doesn’t provide protection against own-damage. The premium that you pay for third-party cover is the lowest among all the insurance policies.

The different types of damages covered under this policy are as follows:

  • Any damage caused by you to the third-party’s property.
  • Any bodily harm caused to the third-party.
  • Accidental death caused to the third-party because of the accident.
  • All the legal liabilities are also taken care off under this policy.

There are also a few exclusions under this policy. This policy doesn’t cover any damage caused to you during an accident. Thus, you will have to pay for all the expenses.

  1. Comprehensive cover: Comprehensive car insurance policy is also known as an own-damage cover. Unlike the third-party cover, the comprehensive cover is not compulsory in nature. There are a number of things included under the comprehensive policy; however, you will have to pay slightly higher amount of premiums to opt for their benefits.

The different types of damages included under the comprehensive cover are here as follows:

  • This policy covers all the damages caused to the third-party such as financial damage, bodily harm, permanent or total disability, death, etc.
  • Other than the damage caused to the third-party, this policy also covers the damage caused to you and your car.

However, there are a few exclusion of the comprehensive cover as well,

  • The comprehensive car insurance policy doesn’t cover any damage caused to your vehicle’s engine.
  • The comprehensive policy will not cover the damage caused by you under the influence of intoxicants.
  • Any damage caused by acts of vandalism, riots and wars are also excluded from this policy.
  • This insurance policy will not cover any damage caused in an accident, if the driver doesn’t possess a valid driving license.

As we can see, there are a number of things which are not covered under the comprehensive cover. However, to overcome that deficit, there are also a lot of add-ons available in the market. You can make use of them and protect your car against the imminent threats of the road. The different types of add-ons available are as follows:

  1. Engine protection add-on: Engine is considered to be the heart of any motor vehicle. It is also the most expensive part of your car; however, your comprehensive cover doesn’t cover the repair or replacement costs of the engine. You can opt for an engine protection cover and relieve yourself from the worries and hassles of engine repair expenses because your engine protection cover takes care of it all. Now you can enjoy the rainy season without worrying about any damage to your car’s engine.
  2. Emergency road-side assistance: Imagine, enjoying a long drive with your loved ones and being stranded in the middle of nowhere. Scary thought, isn’t it? However, now you don’t have to worry about it, because your emergency roadside assistance cover will give you all the help that you need. This cover provides emergency services such as towing, mechanic, change of car tires, etc.
  3. Key replacement add-on: Forgetting to carry keys or misplacing them is something that we all encounter. However, now you don’t need to worry about it as your key replacement cover will take care of the costs of changing locks as well as keys.

Other than these three, there are a number of other add-ons available in the market such as: zero-depreciation cover, personal accident cover, vehicle replacement cover, NCB protection add-on, rental reimbursement cover, etc. Thus, you can choose the add-on based on your needs.

The benefits of opting for car insurance policy are as follows:

  • The biggest benefit of opting for car insurance is that you are following the law.
  • It provides you with protection against financial, bodily as well as legal liabilities caused by an accident.
  • By opting for a car insurance policy, you can drive with peace of mind.
  • The insurance policy also covers damages caused by fire, theft, etc.

 

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