Your car is an expensive, depreciable asset which you cannot do without, given the busy lifestyle you lead. It requires annual maintenance and insurance like every other asset and you should find the best insurance possible, considering the usage, the cost of the car and how long you intend on keeping the vehicle. Maintenance of the car plays an important role in the resale value as well. Insurance is important on roads where regulations and safety might not be followed properly and to that effect, the Motor Vehicles Act 1988 makes car insurance mandatory while purchasing a car.Therefore, it is always recommended to have the vehicle protected with an insurance policy.
Here are a few points to keep in mind while looking for a car insurance cover –
Annual rate check – You will probably need an annual or two-year insurance on your car. You can do an annual check regarding the rates before you go for renewal. Online quotes checks and additional covers should be explored as well.Make sure that you get the best deal before you finalise one. A personalized quote from an agent can be helpful sometimes.
Choosing the right company – While rate checks are important, choosing the right company with a good claims record and payments is equally necessary. Also, some insurance companies give access to a wide network of garages or tie-ups on discounts. Keep a lookout as per your car model, year and make. Choose a company that has a good reputation in the market.
Third Party Liability – While you are driving your vehicle, unfortunately you might get involved in an accident where you might end up hurting another person and can be sued for damages. In such a case, thethird-party liability insurance cover will help you pay for this kind of claim. In other words, third-party liability insurance helps you to stay protected against claims on account of injury of the third party to whom the damage was done.
Comprehensive Car Insurance cover – This kind of insurance cover is relatively more expensive than the third party insurance as it will cover a host of costs– any bodily harm to your own car, any third party insuranceand even damages to the persons around the accident, the driver, and the passengers. Basically, this kind of insurance coverage considers all the damage that is done to the vehicle as well as to the third party.This is a wide coverage and hence slightly expensive but is the most preferred and thus highly recommended.
Understand your needs – If you drive on a daily basis or take the car for long drives, it’s best to go for a comprehensive coverage. If you are an infrequent driver who uses the car now and then, you can go for Third Party Insurance. Also, it might be more important to go for car insurance add-ons if you have expensive gadgets and upholstery in the car. While it can become expensive, it is important to go for add-ons like zero depreciation.
Reduced usage– Had you been using the car extensively for long distancesbut now the usage has decreased due to change in location / job?Then you might require lesser cover and even lesser premium. You can negotiate this the next time you go for renewalas less driving may lead to a reduction in the premium amount.
Crash repairs and parts– You can keep a check on the places you go for repairs and changes. You must ensure thatthe original equipmentis being provided by the manufacturer. Cheap spare parts can cause rusting and further damage or burn out other parts, thus causing the depreciation at an early stage. This will leave your insurance claim in a lurch later. Thus, choose parts which match the standards of care as per regulations. Studies have shown that the low-quality parts are quite prone to rust thereby not meeting the quality standards.
Choosing the right car– Usually, different cars have different collision rates and the breakdown helps insurance companies understand the statistics of various probabilities in accidents. If you choose a car with low collision probability, it might lower your premium. You must check with the car dealer for the collision probability as they have already captured such details before selling the car.
All in all, choosing the right car insurance is an important step requiring much consideration, just like purchasing the car itself. Beware of scams, take advantage of discounts and do not get lured by free insurance as it might not offer a lot of important and vital covers as discussed above.
In addition to this, if the policyholder/car owner does not claim on his vehicle, he is eligible for a reduced premium by almost 50% every year. In other words, the car owner can benefitfrom the “no claim bonus” offered by the insurance companies.