Everything you need to know about auto insurance

Everything you need to know about auto insurance

According to a survey conducted in Pakistan, 75% of the people don’t comply with the vehicle ordinance act 1965 that bounds vehicle owner to have auto insurance. Why is it a law?

One of the best reason that described auto insurance is that it helps find criminals, as they are mostly without an insurance paper. Crime is everywhere and you just can’t imagine a world with no crime. Even if you do, you can never determine the damage done by unexpected accidents. This situation always has a devastating effect and ultimately, it will leave you in massive trouble.

Every year thousands of cars get stolen globally, sometimes police do retain them but in a miserable condition; With this number, car theft business has touched a 5bn profit, reported in a times survey. This immense business is no doubt causing much trouble in the world and never the less with so many reforms being made, still, the crimes are on their rise. In an unsafe, is it better to risk your money or stay protected? Is it wiser to pay a few dollars for an auto insurance or risk your new car? These questions have obvious answers.

An insurance company is liable to cover for your loss in case of unexpected accidents and thefts while giving you the ultimate piece of mind. Upon investigation, the insurance company provides you the full support in the recovery of your assets. Few important features are described below.

What are the requirements for getting a car insurance in Pakistan?

Many moons back, the process of getting auto insurance was no less than a herculean task, but the process is much simpler now. Car insurance in Pakistan can be availed with relatively easy steps: The person should adhere car’s registration papers, Valid CNIC Copy (Make sure it isn’t expired), and detailed photos of the car (From every angle). Photos are demanded by the insurance provider as they have to keep a check that which car they are paying for. In the past, there are various attempts being made to fraud insurance companies that’s why insurance companies in Pakistan ask for complete details about the car. If you have done an upgrade in your car for eg: updating a sound system; it’s necessary to inform insurance provider about the latest update otherwise, they won’t cover if it’s get lost.

How do insurance works?

An insurance company charges you a certain amount, depending upon the value of your car, and it covers for you in case of thefts and accidents. It’s so simple.

How much we have to pay insurance company?

The percentage rate of auto insurance varies from company to company but it mostly depends upon your car. In most case, it’s 3%, it may vary in other cases.

Is it an industry standard and what depreciation?

In the very first year, if an accident occurs, a client is supposed to pay 10% to 20% of the total damage while insurance provider is liable to pay the rest. However, the percentage decrease yearly as in the next case, much of it has to pay by the client.

What are the exceptions?

Any damage done to the car due to a circuit failure is never covered by an insurance company, in most cases, they don’t. Moreover, insurance companies don’t cover the tires and batteries so they are an exception and needs a regular check.

What are the steps to be taken after an accident?

First of all, stay on the scene even if it’s your fault. Remember there is nothing above humanity. Look for the injured and provide them immediate medical assistance or call the ambulance. Make sure everyone is safe including you and no one is injured badly. The very next step would be taking evidence and statements of people as that will help you build a strong case. Call your insurer immediately and let him know everything about the accident. Be careful with your tongue as any mistake would lead them to believe it was your fault. Don’t apologize at the scene of the accident as that will give an impression that it was your fault. After that, your insurance company will investigate the loss and will coordinate you accordingly.

Note: There isn’t any science. If you think they won’t cover, it’s clearly a misconception. They will definitely cover for the accident because they are liable to do so.

While insurance companies may reject many people in giving car insurance in Pakistan; the reasons vary from racer boys to “rent a car” people, however in most cases, they don’t let anybody walk out. Compare insurance companies and their offers as that will help you find the best for you needs. A bit of digging is always good as it will eliminate the chances of making a bad decision.

Also Read: What is the difference between Group health insurance & individual health insurance

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