Third party liability insurance:
- The most basic type of car insurance in car insurance, third-party liability insurance is totally compulsory in India. It will cover your liability for damage or injury to another caused by you in case you cause an accident with no fault of yours.
Coverage:
- This cover avails compensation for damage or death caused by another person or his vehicle to the insured, his property availed of, or to himself during an accident. It only provides for that in an accident, the victim and his property availed of are compensated. It does not, however, cover damage of the insured car and any injury suffered by the driver.
Premium:
- Third party liability insurance premium is ruled by IRDAI, a bit lesser than the comprehensive plans. For example, the annual premium of the vehicles, whose engine capacity would fall between 1000 cc to 1500 cc, for the fiscal year 2023-24, is at ₹ 3,416.
Comprehensive Car Insurance:
This insurance will cover the third party liabilities also along with taking care of damages to the car owned by the insured.
- Coverages The insurance policy gives covers losses arising due to accidents, thefts, man-made accidents of vandalism or fire and any natural calamities like floods, earthquakes, etc. Besides this, the insurance also provides personal injuries, third-party liability, and damage to the insured vehicle.
- Full coverage is costlier than third-party cover because it provides an increased amount of coverage. The premium of car under mid-range ranges from ₹10,000 to ₹20,000 per year, which is only based on the model of the car, size of the car, and location of its engine.
- Claim Settlement: The claim settlement ratio of any insurer has to be the first consideration while making the choice of an insurer for other inputs. The popular insurers in India have excess claim settlement ratio (above 90%) kept to get the same claimed amount processed with due timeliness and efficiency .
- Add-On Benefits: Add-on optional covers that go along with the comprehensive policies include zero depreciation, engine protection, return-to-invoice, etc.
Pay-As-You-Drive Insurance:
Now, there is the newly introduced pay-as-you drive insurance policy whereby premium is tied up with how people use the car. Its model works very well for owners who do not use the car much at all, and premiums are billed according to the number of kilometers the drivers have covered.
That’s quite different because they are much more flexible on most of the coverage, whereas the full comprehensive isn’t. Kind of a good deal for someone who has to commute a few blocks to work. Much cheaper than for the average vehicle owner.
This is based on what mileage you are supposed to; if the mileage is low, the premium is low. That’s why it becomes a very good fit for a city dweller who does not own his car but sometimes drives out.
Pay-as-you-drive insurance is still in its infancy in India but would take off with the rise of urbanization and increasing laws on traffic.
Add-On Covers for Car Insurance:
This addon ensures that the absolute cost of replacement for damaged parts is covered, devoid of any consideration to depreciation. An insurance policy normally deducts depreciation on parts like plastic or rubber, but now with zero depreciation, the policy holder gets the whole claim amount.
It simply means that the usual premium is bumped up by 10-20% when the owner opts for this cover. However, it is very much recommended for new or even luxury cars. The cover provides financial protection for damage of the engine through any kind of effects which may include water leakage, oil drips and hydrostatic lock. It is specially helpful during the monsoon season when the risk from floodwaters and associated engine damage is heightened.
- Cost: The cover for the engine protection will cost the premium of the policy ₹2,000 to ₹5,000 every year, depending upon the model of the car and the insurer.
No Claim Bonus Protection:
The no claim bonus is a discount on your premium if you do not make any claims in a year. This bonus is not nullified by claim at any point in the policy year, thereby ensuring that your accumulated discount remains for future renewals under the NCB protection cover. This add-on gives services such as towing, emergency fuel delivery and repair assistance for that roadside assistance. It is especially really great for travelers who need to drive long distances or traverse backcountry tracks very often.
- Cost: A roadside assistance premium isn’t very expensive-they usually start off at ₹500 to ₹1,000 per year from an insurer.