A car insurance policy is a type of vehicle insurance that offers comprehensive protection to the insured car in case of damages due to natural and man-made calamities. It prevents the car owner from incurring any monetary losses resulting out of unpredictable incidents including accidents, third-party liabilities, fire and theft.
Car owners have the option to choose between buying third party insurance or a comprehensive cover for their vehicle. As the name suggests, a third party car insurance provides protection in case an accident caused by your car resulted in any third-party liabilities. On the other hand, a comprehensive car insurance policy provides coverage for third-party liabilities as well as for Own Damage (OD) i.e. any accidental damages suffered on the insured car. Besides, you can also get personal accident cover for the owner-driver to stay protected from any car accidental injuries.
In India, it is compulsory for all cars plying on roads to have a valid third-party liability cover as per the Motor Vehicles Act, 1988. Moreover, newly purchased cars should have mandatory third-party liability cover for 3 years with at least 1 year of OD. Car insurance for old cars is available for one year only and thus, have to be renewed annually.
What is Car Insurance?
Car insurance is a contract between the insured and the insurers to ensure financial protection against any loss or damage in case of an accident, theft, and death or third party liabilities. The sum assured amount of car insurance policy is the compensation amount that the insurance company pays to the policyholder as per the IDV of the car.
Why you should Buy Car Insurance?
It is mandatory to buy car insurance in India irrespective of the vehicle type, i.e. personal or commercial vehicle. The insurers compensate for the loss or damage caused to the insured vehicle and a third-party from the insured four-wheeler. Here are some of the reasons to buy car insurance policy in India in addition to it being a mandatory requirement as per the Motor Vehicle’s Act:
- It pays for the car damages as a result of collision, accident, death or natural calamities, which otherwise would need to be paid by the insured
- It pays for hospitalization expenses incase of an accident
- It reduces the financial and legal damages that can arise from a third-party laibility or damage
- With rider benefits like roadside assistance, zero depreciation the expenses are further reduced
Moreover, the premium amount of your car insurance is decided based on the Insured Declared Value or IDV of the vehicle. If you increase the IDV, the premium rises and if you lower it, the premium reduces.
It is important for any policyholder to compare various car insurance plans options before going for car insurance renewal or buying a new policy. Compare various car insurance plans online on Policybazaar and buy the one that fulfills your expectations hassle-free:
- Get the best car insurance plans from top insurers
- Instant and paperless car insurance renewal process
- Comprehensive coverage for four wheeler vehicle
- A wide range of Add-on covers for improved protection
Benefits of Buying Car Insurance Online
Buying car insurance online is a common practice today. If you are wondering why most people prefer to purchase car insurance online, check out its benefits below:
No More Agents
Offline purchase of insurance policies involve agents who try to sell their own product rather than suggesting you a better policy from another insurance provider. Online purchase of car insurance will eliminate such agents and you can buy the best policy after comparing various plans offered by different insurance companies.
Another benefit of buying car insurance policy online is zero paperwork. Contrary to the offline mode which requires you to fill multiple forms, the online mode allows you to fill up all the forms online. You can also upload the required documents online making the application process digital and free of any paperwork.
Convenient & Saves Time/strong
As compared to the offline modes, buying car insurance online is very convenient. You don’t have to travel to a branch of the insurance company or take out time to meet the agent. You can get your car insured from the comforts of your home, hence, saving a lot of time and efforts.
Missing policy payments or renewals can cost you a great deal. Not only will you lose out on the renewal discounts but also have a break in policy. But if you purchase your car insurance policy online, you will receive timely reminders ahead of your due date ensuring that you do not miss out on the payments.
Buying car insurance online offers cashless facility and involves zero cash transaction. You can make payment of your insurance premium online through online modes such as debit card, credit card and internet banking.
With the online purchase of car insurance, you can easily compare the plans offered by different companies. Online aggregators allow you to compare the coverage and the premium quotes provided in different plans before selecting an ideal insurance policy for your car.
Buying insurance policy online is more economical as you save a lot of in-between costs. Your premium reduces due to elimination of agents, zero paperwork and you get discounts that further reduce the amount of premium you pay.
Endorsement refers to any changes in the information provided in the policy document. in case of online endorsements, you just have to give a self-declaration as opposed to the filling up the endorsement form manually and submitting all the documents.
Soft Copy of the Document
Another benefit of applying for car insurance online is that you have a soft copy of your policy document in your email. This makes it easy for you to access it from any place without the need to carry a hard copy with you.
Types of Car Insurance Policy in India
There are primarily 2 types of car insurance policy that are available in India –
Comprehensive Car Insurance
A comprehensive car insurance policy provides coverage for third party liability as well as damages caused to your own car. In comparison with third party liability car insurance, a comprehensive car insurance policy offers extensive coverage, more benefits and covers the damages caused to the insured car in case of an accident, collision, theft, etc.
A comprehensive policy can be further extended by opting for add-ons like accessories cover, engine protector, zero depreciation cover, medical expenses, etc. This type of coverage is the most popular as it offers end-to-end coverage and thus less stress for the policyholder.
Third Party Car Insurance
Third party car insurance safeguards you from any legal liability due to your own car’s involvement in an accident. Your insurance provider will compensate you for death, disability, injury, or property damage to any third-party. Therefore, you are protected from the financial liability towards the third-party.
Third-party Liability Car Insurance is a mandate in India under the Motor Vehicles Act, 1988.
Below is the third party car insurance premium rates effect from June
|Engine Capacity||Premium Effective June 16, 2019 (Rs.)|
|Less than 1000 CC||2,072|
|More than 1000 CC & less than 1500 CC||3,221|
|More than 1500 CC||7,890|
Best Car Insurance Companies with Claim Settlement Ratio 2018-19
|Insurance Company||Incurred Claim Ratio|
|Bharti AXA Car||75%|
|New India Assurance||87.54%|
See More Plans
Disclaimer: The ranking of the insurance companies in this table is in alphabetical order. The data has been taken from IRDAI Annual Report 2018-19.
How to Select the Best Car Insurance?
Finding the best car insurance can be a great deal, as this is a yearly investment that you make to cover the risks while driving on the road. The market is bursting with numerous car insurance plans providing value-oriented services to its customers. And it can get quite confusing to find the best car insurance policy online?
This checklist of the best car insurance companies in India will help you compare different quotes from various insurance companies online and select the best deal for yourself. You can check out this list of the best car insurance plans for 2020, by analyzing their features including the incurred claim ratio, network garages, and the coverage benefits.
Points to Consider While Selecting Best Car Insurance
- Know what is covered– Checkout the inclusions and exclusions of both third party insurance and comprehensive vehicle insurance policy. Only buy third party insurance if you can bear the own damage expenses.
- Compare Online – Compare car insurance online and select the one that meets most of the your financial expectations. You can easily get multiple car insurance quotes online from the best car insurance companies in India.
- Claim Incurred Ratio – Higher ICR, indicate satisfied customer and more the chances of your claim being settled.
- Seek add-on covers – It is always recommended to buy a comprehensive car insurance policy with additional benefits like roadside assistance, zero depreciation, flat tyre assistance, etc.
Best Car Insurance Policy in India
The following table shows the complete list of the best car insurance providers in India with their personal accident cover and the number of network garages:
Disclaimer: The ranking of the insurance companies in this table is in alphabetical order.
TATA AIG Car Insurance
Tata AIG Car Insurance has an Incurred claim ratio of 79.31%. The company offers a comprehensive car insurance plan that includes various add-on covers like PA cover, roadside assistance, No-claim-bonus protection, engine secure cover to offer maximum protection in case of accidental injuries or collision. The insurer gives an option to avail cashless repair in more than 3000 network garages, and claim settlement or reimbursement within a week.
Bharti AXA Car Insurance
Bharti AXA car insurance policy purchase and claim settlement is a quick and hassle-free procedure. They are one of the most trusted names in the insurance industry with an Incurred ratio of 81.74%. The insurer provides a digitally enabled process with the PAN India service. cashless repair services are available in more than 4000 network hospitals.
HDFC Ergo Car Insurance
HDFC Ergo is trusted by more than 75 lakhs customers and is one of the most reputed insurance companies in our country with an Incurred Claim ratio of 84.37%. HDFC Ergo car insurance is a viable option as it offers a multitude of benefits including 24*7 assistance and cashless claim settlement in more than 6800 network garages PAN India.
Cholamandalam Car Insurance
Cholamandalam car insurance policy is easily available online for both personal and commercial vehicles. The insurance provider is a known name in the motor insurance sector with an Incurred claim ratio of 84%. The company offers a number of car insurance benefits ranging from third-party cover, own damage cover, and PA cover. There are more than 4500 network garages where the insured can avail cashless repair services.
Bajaj Allianz Car Insurance
Bajaj Allianz has its presence in more than 800 cities across India. Bajaj Allianz claims payment ability has been recognized was recognized with iAAA rating by ICRA for 11 years consecutively. It reflects positively on companies’ incurred claim ratio, which is 62.20 % for the year 2018-2019. There are optional covers available, wherein you can opt for roadside assistance, conveyance benefits, repairing assistance in more than 4000 network garages and lot more.
Royal Sundaram Car Insurance
The insurer provides a hassle-free claims settlement and damage repair facility in more than 4500 network garages. The insurer’s ICR for the year 2018-2019 is a good 84%. The policy offers financial protection against any loss or damage that is caused to your vehicle. It covers loss or damage resulting in third-party injuries, death, PA Cover and property damage from the insured vehicle. You can get personal accident cover and enhance the quantum of protection with add-on covers.
Reliance Car Insurance
Enjoy a hassle-free claim settlement under any circumstances causing damage or loss to your vehicle. Though, it does not include the routine abrasion to your vehicle. It provides you legal cover against critical circumstances of death, whereas, impairment of a person as well as any destruction or loss of property, is also included. The company’s incurred claim ratio is 85 percent and they have a network of more than 3800 garages where they offer cashless services.
How to Renew Car Insurance Policy Online?
Car insurance renewal is mandatory to avail of the policy benefits without a break. Therefore, you should ensure your car policy before it gets expired. Follow the steps given below to renew your car insurance policy online:
- Go to the renewal section
- Enter the details required on the page, such as your policy number, mobile number, date of birth, etc. and submit them
- Choose the car insurance plan that you want to purchase
- Select the riders or add-on covers that you want to buy or drop (if any)
- The premium amount that you need to pay will be shown on the page
- Pay the insurance premium online with the help of a credit card, debit card or through net banking
- Once the payment is complete, your car insurance policy will be renewed
You will receive the policy document for your renewed car insurance on your registered email id. You can also download a copy of the policy document and get a printout anytime you want.
Benefits of Car Insurance Renewal Online
Is your car insurance renewal due date approaching?
If you are nodding your head in YES, the next question that might come to your mind is- how to renew car insurance?
The answer is ‘Online’! Here’s why you should go online, while renewing your motor insurance:
Switch Insurer Easily
With the online renewal, switching from one insurer to another is no more difficult now. More often than not, usually first time insurance is bought from the dealer itself. Hence, the coverage may not suffice your requirements. Renewal is the best time when you can review your policy coverage or switch the policy for a better alternative. Everything can be possible online.
Restore NCB Benefits
No Claim Bonus or NCB is a bonus offered by the insurance company for not claiming your insurance. While renewing your policy online, you can avail the NCB and get a discount on the premium. This can be done in just a few clicks.
If you feel your existing policy coverage is not performing the way you want it to or if you need more, this is the time to go for add-on covers. These covers boost basic policy coverage. An online application is enough to add a rider. However, the process may differ from insurer to insurer. Doing this offline may lead to tedious paperwork.
Security is the foremost concern while buying or renewing the policy online. When you renew the policy online, the security of the transaction is ensured in an optimum manner. The transaction is done through a secured payment gateway, which keeps your details confidential.
Car Insurance Inclusions
The car insurance policy covers
- Loss or damage to the insured vehicle.
- Loss or damage to your vehicle caused by accident, theft, fire, explosion, self-ignition, lightning, riots, strikes or act of terrorism, natural calamities.
- Financial liability caused by the injury/death of a third party or damage to the property.
- Personal accidental insurance cover.
Car Insurance Exclusions
Following features are usually not covered in car insurance:
- Loss or damage if a policy is not in force.
- Gradual wear and tear of car and its parts.
- Loss or damage to the vehicle when driven by a person without a valid driving license.
- Loss or damage to the vehicle as a result of intoxication due to drugs, alcohol etc.
- Loss or damage to the engine as a result of oil leakage.
- Loss or damage to the vehicle as a result of abuse of car manufacturer’s guidelines.
How to File a Car Insurance Claim?
All the car owners, at some point in time need to file a car insurance claim for a certain loss or damage. To avoid any confusion while filing a car insurance claim, here are a few points that you need to consider:
- Make sure that you have the following Information ready with you at the time of claim Intimation
- Time & date of the accident
- Name of the driver and contact details along with driving license details
- Car Insurance Policy number
- Estimated loss
- A brief description of the incident
- Survey location to support the investigation process
- Insured contact details
- Claim intimation should be provided at the customer help desk. They will take you through the claim process
- Once you have informed, the insurer’s customer support team will provide you the claim reference number
- Upon claim registration, a surveyor will be assigned for your case
- You will receive the confirmation notification on text along with the details of the loss assessor
- You can coordinate for a suitable time with the surveyor and he will conduct the survey as per your convenience
- There are certain documents that you need to provide to the assessor, such as vehicle type and severity of the damage
- You also need to inform about the requirement of the claim processing team to settle own
- damage claim
- Coordinate with the surveyor again if re-inspection of the vehicle was advised by him.
- Based on the survey claim settlement will be done
Documents Required for Filing a Claim for Car Insurance
Keep the following documents ready while registering a claim with the Insurer-
- Copy of Police FIR
- Claim form duly signed by the policyholder
- Fitness Certificate for commercial vehicles
- Driving License
- Car Registration Certificate (RC)
- Insurance documents with the endorsement
The insurer will settle your claim within a week from the date of submission of all the required documents.
How to Determine Car Insurance Price?
Car insurance cost is decided based on several factors. It is also easy to find out the car insurance premium using an online car insurance premium calculator. However, the insurance provider takes into consideration the following parameters before fixing the car insurance price:
- IDV (Insured Declared Value) of the vehicle
- Age and Type of Car
- Engine’s Cubic Capacity
- Geographical zone
Car’s IDV Calculation Formula:
IDV = Car’s Showroom price + Accessories cost – depreciation value
Thus, the formula to calculate OD premium amount is:
Own Damage premium calculation formula
Insured Declared Value X [Car Premium as per the insurer)] + [ Optional Benefits] – [NCB/Discount etc.]
How to Save Premium on Your Car Insurance Policy?
A smart customer is in a constant hunt for discounts which will reduce the burden on his pocket. If you are one among them then here are a few tips that will help you get a discount and save money on the premium value of your car insurance.
Voluntary deductible is the minimum amount that you declare to bear at the time of claim. The higher deductible you opt for, the lower will be your premium. Simply put it means that the financial burden on the insurance provider is less and you will also chip in when an accident or car damage happens.
In case your car is fitted with an ARAI approved anti-theft device, your insurer will offer an additional discount (2.5% on the OD Premium). This discount is provided for the simple reason that an anti-theft device will make your car less liable to theft.
Why Compare your Car Insurance Policy Online?
Compare car insurance online to ensure that you buy a car policy that offers substantial coverage options. With the help of comparison, you can get best car insurance quotes and save up to 80% on insurance premiums including additional riders. You can make an informed decision by comparing car insurance online from different insurance providers.
But before digging into comparing different car insurance plans, ascertain the kind of coverage you need. A liability policy is inexpensive than the comprehensive car insurance policy but only if you are ready to compromise on some benefits because the facilities offered by the latter are undoubtedly the best.
How to Compare Car Insurance Online?
Compare car insurance online on the basis of the Incurred claim ratio of the insurer and the number of garages where the insured or the policyholder can avail cashless repair services. In addition to this, there are a number of factors like add-on covers, PA cover limit, easy renewal, No-claim-bonus etc. Comparing different car insurance quotes on these factors would help to make an informed decision.
Compare Car Insurance Policy Features
While purchasing your renewing your car insurance policy online it is imperative to compare the policy features. Because it may vary from one car insurance policy to another. Compare the features and benefits that different insurers are providing along with the add-on covers to enhance the coverage benefits. You can select the policy that meets your requirements along with affordable premium rates.
Comparing Car Insurance Premiums and Deductibles
Car insurance comparison should be done online on the basis of the deductibles and the premium. Car insurance premium also varies on the basis of the deductibles. Deductible refers to the amount that the insured has to pay at the time of claim settlement.
For instance, if the claim amount is Rs. 25000 for accidental repairs and our voluntary deductible are Rs. 5000, then the insurer will pay off Rs. 20000 at the time of claim. Deductibles certainly reduce the premium rates. However, choose deductibles only when you can pay the cost. Also, check-out discounts at the time of purchasing car insurance policy such as No Claim Bonus and any other rewards.
Add-On Covers in Car Insurance
Add-on covers are the additional covers or protection that you include in your car insurance plan to keep your car safe from any damages or total loss. The add-on covers need to be purchased on payment of extra premium amount. Following some add-on covers are No Claim Bonus Protection cover, Zero Depreciation cover, Engine Protection cover, Key protection cover, etc.
No Claim Bonus Protection Cover
For every claim free year, the insured is rewarded with a discount on the renewal premium. This discount is called – No Claim Bonus (NCB). It is cumulative and increases every year. It usually ranges from 10% to 50% and can save a substantial amount of money on the premium payable for your auto insurance.
Let’s take an example if a policyholder doesn’t make a claim during the tenure of his auto insurance policy, he becomes eligible for No Claim Bonus, on the basis of which, a certain rebate is offered on the payable premium. With No-claim-bonus protection cover you can retain your NCB even after registering a claim during the policy term. The terms and conditions vary from one insurer to another.
Engine Protection Cover
An engine is one of the most important parts of a car. And engine protection cover compensates the cost of fixing the indirect damage that are caused to the engine due to lubricating oil leakage and water ingression. It covers the Gear Box Parts, Engine Parts, and DifferentialParts.
Zero Depreciation Cover
This additional feature offers compensation even for the depreciating value of your car. With this feature, you will not have to pay for the depreciation value of your vehicle’s parts. It is mostly valid on private cars and is subjected to a specific number of claims during the policy period. Compulsory and voluntary deductibles (as per the case) will be applicable despite zero depreciation cover. You can check with the insurance company for any terms and conditions before making the purchase.
Sometimes, a bunch of unforeseen expenses can drain all your savings. Consumables Cover. Includes all the expenses incurred on consumable items for any perils that are covered under the policy. Consumable items include screws, nuts and bolts, washers, AC gas, grease, lubricants, bearings, clips, engine oil, distilled water, oil filter, brake oil, and fuel filter are mostly covered.
There are certain terms and conditions that are applicable to this add-on cover that varies from one insurance provider to another. It is mostly valid on private cars and is subjected to a particular number of claims during the policy period. You can check with the insurance company before making the purchase.
Key Protection Cover
Once in a lifetime everyone would have lost or misplaced their car keys. In such cases, the insurer can offer you the financial help by covering the costs incurred on replacement and repair of your car keys. Here’s was Key Protect Coverwill offers.
- You will be permitted for a fixed number of claims during your policy period
- Any case related to theft or burglary should be supported by a Police FIR
- The replaced keys will be of the same type as the ones that were lost or stolen
- Any broken or damaged keys will be replaced by the insurer
- In case of misplacement or theft of car keys, the insurer will replace the entire set of keys including h lockset, after submission of all the other keys to the insurer
Daily Allowance Benefit
In case of accidental damage, you might have to leave your car in the workshop and travel on your own. This add-on cover comes to your rescue when your vehicle is parked in the garage after an accident for repair. If you have this add-on cover the insurer will provide you daily travel allowance if the vehicle requires has to be in the garage for more than 3 days (varies from insurer to another).
Personal Accident Rider Benefit
Personal Accident Rider is an optional add-on benefit that can be added to the comprehensive auto insurance by paying an extra premium. This rider provides the policyholder with the coverage of medical expenses due to damage, personal injury or disability caused due to an accident.
Cover for Car Accessories
By simply opting for separate add-on policy, you can avail the coverage for your car accessories, which a normal car insurance policy may not cover. Such additions may increase the premium, but it is always beneficial and cost-effective rather fitting a new car accessory.
Save Through Paying High Deductibles
Deductibles are a certain percentage of the claim amount that the insured has to pay from this own pockets. A policyholder can save by paying higher deductibles. At the time of filing a claim, if you choose to pay higher deductibles against your claim, your auto insurance provider manages to give you some discount on premium later on.
How to Get your Car Insurance Quotes Online at PolicyBazaar?
On PolicyBazaar you have to fill a few simple details like make of the car, model, variant, year of manufacture, etc. You will then get car insurance quotes from various insurance providers. To get better discounts you must fill the form carefully. This way you will get customized quotes, one which saves money (up to 80%) on premiums and is also the best fit as per your needs.
You must be familiar with the following terms while filling the form:
Car Make, Model and Variant
This information is critical to calculating the base premium. A luxurious, powerful and expensive car will attract more premiums. For e.g. an SUV car will always have a higher premium than a family car.
Year of Manufacture
The manufacture year of your car lets the insurance company assess its Insured Declared Value (IDV) that facilitates the underwriter to decide the annual premium for your car.
CNG Fitted Car
Being more vulnerable to combustion, a CNG fitted car is usually insured at a slightly higher premium than a plain petrol/diesel car.
You need to mention whether you do or do not want to get a cover on electrical and non-electrical accessories fitted in your car. Most insurers provide a cover for your car accessories at an additional premium of 4% on its value.
Process Steps for Acquiring a New Four Wheeler Insurance Policy:
Step 1: Log in to www.policybazaar.com and click on the product icon.
Step 2: If you want a fresh comparison of four wheeler insurance plans, click on ‘Begin your comparison’. In case you have searched before, you can retrieve your previous searches and continue from where you left off by clicking on ‘Get previous searches’.
Step 3: Before you start the comparison, keep a few details handy such as the city of your car’s registration, make and model, fuel type, and the car’s variant.
Step 4: To get new insurance quotes, key in all the above-mentioned details in the form and click on the ‘Next’ button.
Step 5: On the next page, fill in your personal information such as your full name, email address, and mobile number. Click on ‘View Quotes’ to proceed.
Step 6: In the quotes section, you’ll have a list of different auto insurers with a discounted price, add-ons, and final price. You can view each plan details and compare it with other plans well.
Step 7: To get a discount on the premium, click on the ‘Get Discount’ button on the left side of the page. After clicking the button, a form will appear where you have to fill in your details. After completing the form, click on ‘Apply Discount’.
Step 8: Click on ‘Select add-ons’ to tick the list of added extras in your car such as 24*7 roadside assistance, No Claim Bonus (NCB) protector, engine protector, key and lock replacement, and consumables.
Step 9: If you want to include passengers under the plan, click on ‘Passenger/driver cover’.
Step 10: To find the nearby motor garage, click on the ‘Garage locator’ on the bottom left of the page.
Fill in these details carefully then sit back and relax for a while. You will be presented with a list of insurance plans that suits your requirement at best possible rates.
Q: What is IDV (insured declared value) in Car Insurance?Ans: IDV (insured declared value) is the maximum amount to be paid by an insurer at the time of a claim if the vehicle is a total loss or stolen. It is the sum insured and is fixed at the commencement of the policy period for each insured vehicle. To know more about IDV click here.
Q: What is voluntary deductible in Car Insurance?
Ans: Voluntary deductible is the minimum amount that you agree to pay at the time of claim. For instance, if your total claim amount is Rs 10,000 and you agree to pay Rs 5000 of your claim in addition to compulsory deductible, then it is called voluntary deductible.
Q: Why should one have a comprehensive car insurance policy when law mandates insurance only for 3rd party injury, death or property loss?Ans: Although law mandates insurance policy for 3rd party only but it is strongly advised to buy a comprehensive insurance policy that protects your vehicle from man-made or natural calamities. With comprehensive cover, you can claim from your insurer for accidents or damages caused to your vehicle. In the absence of comprehensive cover, you need to foot the entire bill on your own. Thus, with comprehensive insurance policy on your side, you get complete peace of mind that whatever happens to your vehicle on the road, your insurance company will share your financial losses.
Q: Are there any special discounts available for handicapped people?
Ans: Car insurance companies give 50% discount on the own damage premium for handicapped people, provided the vehicle has been modified for their use.
Q: What is ARAI in Car Insurance Policy?
Ans: Car insurance companies offer a discount on the premium for installing anti-theft devices approved by Automobile Research Association of India/ARAI. It enhances the security and reduces the chances of making the claim and for this reason, discount is provided on the premium.
Q: What is total loss of a vehicle?
Ans: Total loss means accidental damage to a vehicle where insurance company’s share is more than 75% of the IDV.
Q: If I fit CNG or LPG kit in my car, is it necessary to inform the Insurance Company?
Ans: If you have LPG or CNG fitted in your, you have to get it endorsed in your Registration book or RC. Then, inform your insurer about the change to get it endorsed in your car insurance policy. As the cost of premium will differ basis on the fuel type of your car.
Q: What is break in renewal policy?
Ans: Break in renewal policy is one of the simplest options available in the market to renew your lapsed policy. It means you can renew your expired policy without any inspection and documentation. It is not only hassle free but also a great money saver technique.
Q: What is compulsory excess?
Ans: A compulsory excess is an amount that your four wheeler insurance company has decided that you will pay at the time of claim settlement. The amount varies on the basis of cubic capacity of the vehicle. For sub 1500 cc vehicles, it is Rs 1000, for vehicles above 1500CC it is Rs 2000.
Q: What is the depreciation in car insurance?Ans: The value of a car depreciates with time and its parts also wear out with time. While calculating the IDV the depreciation on parts is calculated as mentioned in the table below:
Age of the Car Depreciation in Percentage
More than six months 5
Between six months and one year 15
Between one and two years 20
Between two and three years 30
Between three and four years 40
Between four and five years 50
Q: How do I change the registration address or vehicle information on the insurance policy?
Ans: For any change in registration address or vehicle information, you need to submit RC copy along with a request letter. Any change will be done by an endorsement by the insurance company. For some endorsements, a policyholder may need to pay additional premium.
Q: What documents do I need to submit at the time of car insurance claim?
Ans: You may need to submit duly filled claim form along with following documents- A copy of the vehicle’s registration number A copy of the driving license of the person driving the vehicle at the time of an accident along with the copy of the driving license of the person in whose name the RC and insurance is. Estimate repair cost A copy of FIR in case of theft or third party personal injury, death or property damage If the insurance company’s share is more than 75% of IDV, it is called total loss. You may need to submit additional documents to initiate claim proceedings at the time of total loss- RTO transfer paper Original RC copy Vehicle’s original keys No objection certificate from insured for the transfer of a vehicle Letter of indemnity on judicial stamp paper
Q: Is there any specific exclusion in car insurance policy?
Ans: Car insurance policy doesn’t offer coverage in following situations- Normal wear and tear Loss or damage caused to the vehicle due to depreciation Electrical and mechanical breakdown of a vehicle Any accident outside the geographical location Driving without a license If a person is driving under the intoxication of drug/drugs Vehicle not being used for purpose mentioned in the document. Damage caused due to nuclear fission, war invasion
Q: Is it important to have a motor insurance?
Ans: According to Motor Vehicle Act, it is mandatory that every motor vehicle plying on the road should be insured with ‘liability only cover’. It ensures that any damage done by your vehicle to another person’s property will be covered in a claim. By buying motor insurance, you can protect your vehicle from natural disasters or theft. When an insurance policy is giving you ample benefits and coverage, we don’t find any reason of not buying it.
Q: How can I add/delete hypothecation in my car insurance policy?
Ans: Hypothecation is used for creating charges against the security of movable assets. The possession of goods remains with borrower. For instance, in car loan, vehicle remains with the borrower but the ownership is hypothecated to the bank. It means bank has a right to sell the vehicle if there is any default in repaying car loan. To add hypothecation in car insurance policy: Letter from the bank or financer/endorsed RC copy has to be submitted at the office of insurance company. To delete hypothecation in motor insurance policy: No objection certificate (NOC)/endorsed RC copy has to be submitted at the office of insurance company. In case of a hypothecated vehicle, it is important to obtain NOC from the financer if the payment has to be obtained by the insured. Otherwise claim amount will be paid to the financer for losses other than theft.
Q: If my NCB has been earned in a foreign country, will it still be applicable in India?
Ans: Yes, it will be applicable in India. However, the policy must be issued by a reputed foreign insurance company and a proof of the same is required to submit with the new insurance company.
Q: What are the risks covered by the comprehensive car insurance policy?
Ans: Your comprehensive insurance policy covers- Liability to third party Accident by external means Fire, explosion, self ignition, lighting Riots, strikes, terrorism, malicious acts Earthquake, flood, storm, landslide Transit by rail, road, waterways, air or lift Burglary, theft or housebreaking
Q: Am I eligible to get NCB on expired policy?
Ans: You will be entitled to get NCB on expired policy if you will renew it within 90 days of the expiration.
Q: What is cashless facility?
Ans: Cashless facility means you don’t need to pay anything for repair work and your insurance company will directly pay it to the garage. If you have signed up for the cashless facility, all you have to do is take your vehicle to the preferred workshop of the insurance company. The workshop will contact the insurer and settle the claim.
Q: What to do if the insured vehicle meets with an accident outside the city, area or state from where the policy is issued?
Ans: You should immediately inform the insurance company. If you don’t know the contact number then you should search for the local office of the company. If there is a local office then intimate the claim to the company. If somehow you are unable to contact the company or trace its local office, you should click pictures of the accident spot and vehicle. If the loss is major and involves third party damage, lodge FIR immediately.
Q: What documents do I need to submit as a proof of no claim benefits (NCB) at the time of policy transfer?
Ans: You are required to submit a renewal notice from your previous insurer. If this doesn’t state your (NCB) entitlement or if it is not given to you by the company then call your insurer and request confirmation of your (NCB). Alternatively, you can submit your previous insurance papers and declaration that you are entitled to receive (NCB). However, if you are not eligible for NCB and wrongly claimed for it then the insurance contract is void ab initio and the insurance company reserves all rights to reject your claim.
Q: How IDV is calculated?Ans: An IDV is calculated on the basis of the manufacturer’s listed selling price of the brand and model, which will include local duties/taxes, excluding registration and insurance. Different depreciation slabs for arriving at IDV are detailed below:
Age of the vehicle Depreciation value in %
Not more than 6 months 5
More than 6 months but below 1 year 15
More than 1 year but below 2 years 20
More than 2 years but below 3 years 30
More than 3 years but below 4 years 40
More than 4 years but below 5 years 50
For those vehicles which are obsolete or aged over 5 years, the depreciation applied varies from one insurer to another.
Q: What is a no claim bonus (NCB) in Car Insurance?
Ans: No claim bonus (NCB) is a discount in premium offered by insurance companies if the owner of a vehicle has not made a single claim throughout the motor insurance policy term.
Q: Under what circumstances, an endorsement is issued?
Ans: An endorsement is a written proof of an agreed change to a policy wording. If a customer wants to make any changes to the policy, he needs to approach the insurance company to make it effective. This is done by an endorsement. Insurance company may also issue an endorsement at the time of policy issuance to provide additional coverage or to impose restrictions. An endorsement may also be issued subsequently to record changes like change in name, address, etc.
Q: What are types of endorsements and what are the different documents that are required for each endorsement?Ans: Below are some common types of endorsements issued by an insurance company along with documents required for them.
Endorsement Situations Covered Additional Premium Requisite documents
Premium bearing endorsement Transfer of ownership Yes 1. Copy of Registration Certificate (RC), Form 29 & 30 along with seller’s request letter for ownership transfer 2. Duly filled proposal form and signed by new owner along with the original policy copy 3. Request letter signed by new owner for changing ownership
Addition of electrical & non electrical items Yes 1. Copy of RC 2. Invoice copy of all accessories 3. Request letter for the addition of accessories
Addition of LPG/CNG kit Yes 1. Copy of RC 2. Invoice copy of kit 3. Request letter for the addition of kit
Change of RTO location If applicable 1. Copy of RC 2. Request letter for changing RTO location
Non-premium bearing endorsement Correction in chassis/engine/registration number No 1. Copy of RC 2. Request letter for making changes
Q: Does place of residence affect premium amount?
Ans: Yes, your place of residence affects premium rates. The Indian Motor Tariff Act has categorized cities into different zones and each zone has different premium rates. Below is the zone-wise categorization for vehicles: Zone A= Delhi, Mumbai, Bangalore, Chennai, Hyderabad, Kolkata and Pune Zone B= Rest of the country If your residence falls in Zone A then you need to shell out more bucks to buy insurance.
Q: What costs do I have to bear at the time of car insurance claim?
Ans: The costs that you have to bear are salvage value, depreciation cost, compulsory deductibles and cost of consumables. Let’s know more about these costs- Salvage value= It is the estimated residual value of an asset at the end of its useful life. Depreciation cost= It is a loss in value of an item over the period of time. Compulsory deductibles= It is the amount which a policyholder needs to pay upfront at the time of claim. The remaining expenses will be borne by the insurer. Cost of consumables= It includes items like lubricants, grease, engine oil, fuel filter, break oil, nut, bolts, screws, washers, etc.
Q: What is a cover note?
Ans: A cover note is a temporary insurance proof which is issued to a policyholder before the issuance of actual insurance document. A cover note is valid for 60 days from the date of its issuance and is replaced by an original insurance document.
Q: What’s my liability if someone else is driving my vehicle at the time of accident?
Ans: Legally, anyone driving a vehicle should hold a valid driving license for that category. As the owner, it’s your responsibility to ensure that those with a valid driving license are driving your vehicle. Also ensure that no one (including you) drives the vehicle under the influence of alcohol or drugs. If the driver is intoxicated at the time of an accident then insurance company is not liable to compensate the policyholder.
Q: Can I submit bills at the end of the year and claim for all small repairs carried out on my car?
Ans: No, a car insurance claim needs to be lodged immediately with the insurance company and will not be payable if it is delayed beyond a reasonable time period.
Q: What is motor insurance?
Ans: A motor insurance is purchased for cars, trucks, motorcycles and commercial road vehicles. It is an agreement between the insurer and insured, wherein insurer agrees to give financial coverage to the vehicle and the insured in return agrees to pay premium annually.
Q: Is it possible to pay premium for the auto insurance in installments?
Ans: No, Insurance Act 1938 does not allow you to pay premium for the auto insurance in installments. If you buy online, you can use credit card to make the entire payment and then payback it to the credit card company in installments.
Q: What information do I need to submit to buy motor insurance online?
Ans: For buying a policy online no documentation is required whatsoever. However, it is advisable to keep the previous insurance policy and RC handy at the time of buying the policy so that all information can be updated correctly in the policy form.
Q: What is the cheapest car insurance?
Ans: No single policy is the most economical for everyone. Different people can find different insurance policies economical depending on the coverage and the add-on covers. You should compare the coverage and the premium quoted by different insurance providers to find out the most affordable plan for you.
Q: How do I renew car insurance?
Ans: The process of renewing your car insurance policy is very simple. Follow the steps given below to renew your policy online from the same insurer: 1. Visit the official website of the insurance company 2. Go to the option of renewing the policy 3. Enter your policy number or other details required 4. Pay your premium amount 5. Download the policy document You can also renew your car insurance from another insurance provider if you do not want to continue with the same plan.
Q: When should you renew car insurance?
Ans: The policyholder should renew his car insurance before the expiry of his existing policy. This will ensure that there is no break in policy and you can continue to avail benefits such as no claim bonus.
Q: What is zero DEP in car insurance?
Ans: Zero DEP refers to Zero depreciation Cover in car insurance. It is an add-on cover that allows the policyholder to get compensation up to the insured declared value (IDV) or current market value of the car without taking depreciation into account. You need to pay an extra premium amount to avail benefits of zero DEP in your car insurance polic
Q: How many times we can claim car insurance in a year?
Ans: The limit to filing a claim for car insurance per year varies from one insurance provider to another. Most insurance companies allow multiple claims in a year until the IDV is not exhausted. You should check your policy document to know the exact number of times you can claim your car insurance policy in a year.
Q: What is bumper to bumper car insurance?
Ans: Bumper to bumper car insurance refers to the insurance policy that provides complete protection to the insured car without considering depreciation of its parts. In other words, this type of car insurance allows the policyholder to obtain compensation up to the market value of the car in case of damage or loss to the car. However, it attracts about 20% higher premiums than your regular car insurance policies.
Q: Can I claim insurance for car scratches?
Ans: You can claim insurance for car scratches. However, it is advisable to all policyholders to avoid filing a claim for minor scratches. This is because you will have to pay a fixed deductible that may cover a major portion of the claim compensation resulting in you incurring a loss. Moreover, by filing a claim, you will lose out on the No Claim Bonus amount, which you could have availed at the time of policy renewal.
Q: Can I renew my car insurance policy online?Ans: Yes. Almost all insurance companies allow policyholders to renew their car insurance policies online. You can easily renew your car policy online by following the steps given below:
- Enter the policy number along with personal details, such as your date of birth and mobile number
- Select the car insurance plan you wish to buy
- Choose or drop any add-on covers/ riders
- Pay the premium amount shown on the page online
- Your policy will be renewed
Make sure to renew your car insurance policy before the due date to continue enjoying the policy benefits.
Q: My motor insurance policy expired; how can I renew in case of break-in of my policy?
Ans: In case there has been a break in your car insurance policy, you can renew it by following the steps given below: 1. Visit online aggregators to compare the coverage and premium quotes offered by different insurance plans 2. Select the car insurance plan you want to buy 3. Schedule the earliest appointment for car survey with the insurance company 4. A vehicle survey will be conducted by a representative of the insurance company 5. Once the surveyor has give a go-ahead, buy an insurance policy within 24-48 hours, depending on the insurance company 6. Download your policy document
Q: Once the inspection request is logged online, how long does it take to get the car policy?
Ans: After you have initiated an online request for inspection, a surveyor will visit to inspect the car within 48 hours. After the surveyor makes a recommendation in your favour, you will have to buy a car insurance policy within 24-48 hours.
Q: Is my NCB transferable?
Ans: NCB or No Claim Bonus can be transferred from one car to another if the policyholder is the same person. It can also be transferred from one insurance provider to another. However, you cannot transfer NCB from one policyholder to another even if the car is sold to someone else. This is because NCB is a reward granted to the policyholder for being a mindful & cautious driver and not the car.
Q: In case of my job and place change, what happens to my motor policy?
Ans: In case you change your job or city, your car insurance remains to stay valid without being affected. However, you need to get your personal details such as address changed in your policy document for which you need to get in touch with your insurer.
Q: What is meaning of the phrase ‘legal liability of the paid driver’?
Ans: ‘Legal liability of the paid driver’ means that the policyholder has hired a driver to drive his car and the insurer will provide compensation if the driver gets injured or dies in an accident while driving the car.
Q: When should I report to the police?
Ans: You need to file a police complaint if someone gets injured or loses life in a car accident. The complaint should also be lodged if the insured car gets stolen.
Q: What happens to the 4 wheeler insurance policy, if I sell my car?
Ans: If you sell your car, you need to transfer the car insurance policy on the name of the new owner. Follow the steps given below to transfer the insurance to the new owner: 1. You need to get a sale affidavit made with details of the transfer, details of the new owner and details of payment. It should be notarized and signed. 2. Fill up the RTO transfer forms and obtain a clearance certificate from your Regional Transport Office (RTO). 3. Fill up the new proposal form 4. Attach the documents listed above 5. Submit it to your insurer 6. The policy will be transferred within 14 days
Written By: PolicyBazaar – Updated: 22 April 2020