For first-time car owners, purchasing car insurance can be an overwhelming experience. Several insurance providers offer a range of car insurance coverages for customers. To choose the best car insurance policy, you must understand all the coverage available.
This blog will discuss five types of car insurance coverage in detail.
Top Five Types Of Car Insurance Coverage
Own-Damage Car Insurance
Under an own-damage car insurance policy, you get reimbursement for the repair costs of your damaged four-wheeler. The premium for this type of four-wheeler insurance in India is calculated based on the car’s insured declared value (IDV), age and other factors. The insured declared value of the four-wheeler is its market value.
It is important to note that when choosing own-damage car insurance, the insured will be compensated by the insurance provider only in the event of an accident. Therefore, this coverage is a great option for those who live in cities with dense traffic flow or accident-prone areas of the country.
Third-Party Car Insurance
Under the Motor Vehicle Act 1988 in India, third-party car insurance is mandatory for all vehicles. The “third party” in this insurance is any vehicle, property, or person that sustains damage because of the insured while driving their four-wheeler. The scope of this coverage is limited, which is why third-party car insurance is more affordable.
This car insurance liability coverage includes the following:
- Damages sustained by a third-party vehicle.
- Damages sustained by a third-party property.
- Cost of treatment and hospitalisation of third parties.
- Liabilities arising due to the death of a third party.
Comprehensive Car Insurance
This policy is the most comprehensive type of four-wheeler insurance coverage you can opt for your vehicle. The damages covered under comprehensive car insurance include damage to your vehicle and damage from third parties.
Even though this type of car insurance is more expensive than other types, the financial protection provided in case of an unfortunate event is unmatched by comprehensive car insurance in India.
This car insurance policy can protect your four-wheeler from:
- Theft, fire, etc.
- Natural disasters and man-made calamities
- Terrorist activities
- Third-party liabilities
Zero Depreciation Insurance Coverage
This car insurance coverage is generally offered as an add-on cover, either with own-damage or a comprehensive car insurance policy in India. If your four-wheeler is damaged and you must replace the parts, your insurance provider will consider the depreciated value of the car parts for insurance claim settlement.
Zero depreciation insurance ensures that you get the total cost of replacing four-wheeler parts without deducting depreciation value in the event of a claim. This insurance coverage benefits high-end or new cars, as the replacement cost might be higher.
Personal Accident Cover
Personal accident cover can protect car owners in the event of an accident by providing coverage for the medical expenses that may arise after an accident. In case of death due to the accident, the insurer will pay a lump sum amount to the insured’s family.
To Wrap It Up
You must consider a few essential factors to choose a policy among different types of car insurance coverage. These factors include understanding your requirements, range of coverage offered, cashless facility, Insured Declared Value, claim settlement ratio of the insurer, stress-free claims process and more. Protecting yourself with a good car insurance policy can ensure peace of mind while driving your four-wheeler.
