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How To Get The Most Out Of Your Car Insurance Policy

How To Get The Most Out Of Your Car Insurance Policy
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Road accidents are common in today’s times. However, as a vehicle owner if something of that sort hasn’t happened to you one seems to know very little about the claim process in case of an accident. However, if there is damage to the car, we mostly end up paying on our own or we try to save our No-Claim Bonus (NCB). Below mentioned are a few guidelines to help you in getting the most out of your insurance. This will help you in deciding what will be a suitable way to tackle an aftermath of an accident.

In usual cases, car insurance policy offers two types of coverage. There is a liability-only policy that covers third-party liability against an injury caused, property damage or even fatality. Other is a package policy, also known as comprehensive cover; it covers both the damage to the insured vehicle and the third-party liability. Apart from this, some insurance companies also offer a few add-on covers that can be beneficial to the policyholders. Add-on covers are available on all private cars and two-wheelers. Before finalizing whether you should go for an add-on cover or not, one should keep in mind:

  • The total sum insured of the vehicle,
  • The costs of the add-on covers
  • Calculating the car insurance premium that needs to be paid for the same

 

Insured’s Declared Value

The total amount on which you pay the premium for your vehicle is known as the Insured’s Declared Value (IDV). In case your vehicle is stolen or in case of total damage, the owner of the vehicle can claim the amount depending on the IDV. Insurance companies at the time of renewal will fix an IDV of your vehicle on the basis of the year of manufacturing, model and depreciation of the vehicle.

To calculate the IDV, car insurance company analyzes depreciation of the car value on a fixed formula. For vehicles that are older than five years and of obsolete models, the Insured Declared Value is fixed on the basis of a mutual understanding between the insurance company and the policyholder.

One can opt for add-on covers with the basic vehicle insurance and pay the premium accordingly. However, a policyholder should be aware that add-on covers couldn’t be claimed if the vehicle is used for motor rallying and if the vehicle is not being driven lawfully under the Motor Vehicles Act.

Zero Dep Policy

In Zero Dep coverage or Nil Depreciation, the policyholder gets a full compensation on the parts like, fiber, plastic items, windscreen, and rubber also known as consumables that are mostly replaced in the event of loss due to an accident. Many insurance companies offer zero depreciation for the first three years and some even offer for five years against a charge of high premium.

Breakdown Assistance (May or may not be given)

This add-on cover is nominally priced one, it takes care of the car in case of a breakdown or accident on the road. To get the benefit, the policyholder will have to call up the given helpline (Helpline number provided by insurance companies) number so that assistance can be provided. It offers benefits like

  • Flat type replacement,
  • Towing the vehicle,
  • Jump starting the vehicle
  • Providing alternate key
  • Battery assistance
  • Emergency fuel assistance

However, this add-on may or may not be provided by the insurer. You may need to check for the same.

Engine coverage

This coverage can be claimed in case of floods when the vehicle goes into hydrostatic lock that leads to engine failure. This happens due to continuous attempt to start your car when the engine is moist and leading to engine failure. This is generally labeled under add-on coverage.

There are several other benefits offered by different insurance companies.

India has an uncertain distinction of being the accident capital of the world. With an accident happening every six minutes and a casualty every ten minutes, it is vital for us to follow the proper guidelines as a responsible citizen of the nation.

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