Types of Car Insurance Policies
In India, car insurance policies are primarily categorized into three types. Understanding these helps you choose the right coverage for your vehicle.
1. Third-Party Liability Policy
The most basic form of insurance, mandatory by Indian law. It covers financial and legal liabilities arising from damages caused to a third party.
2. Comprehensive Policy
A detailed plan that covers third-party losses AND damages to your own vehicle due to accidents, theft, natural calamities, etc.
3. Pay-as-you-drive Policy
A pilot coverage option where the premium is based on the vehicle's usage (kilometers driven).
Inclusions & Exclusions
Knowing what is covered and what is not is crucial to avoid surprises during a claim.
| Inclusions (Covered) | Exclusions (Not Covered) |
|---|---|
| Losses from natural disasters | Normal wear and tear |
| Losses from strikes, riots | Electrical or mechanical breakdown |
| Personal accident cover | Accidents under influence |
| Third-party liability | Driving without a valid license |
Add-On Covers
Enhance your base policy with these add-on covers for comprehensive protection.
- Zero Depreciation Cover: Get full claim amount without depreciation.
- NCB Cover: Retain bonus even if you make a claim.
- Emergency Assistance: On-road assistance for breakdowns.
- Engine Protection: Covers damage to the engine or gearbox.
- Return to Invoice: Get original invoice value in total loss.
Factors Affecting Premium
Several variables determine the premium amount you pay.
Vehicle IDV
Current market value of your car.
Car Age & Model
Older cars usually have lower premiums.
Engine Capacity
Higher CC generally means higher premium.
How To Reduce Premium?
- Compare Online: Always compare quotes from multiple insurers.
- Lower IDV: Opt for a lower IDV than market value to reduce premium.
- Drive Safely: Maintain No Claim Bonus (NCB).
- Safety Devices: Install ARAI-approved anti-theft devices.
- Long-Term Policy: Buy a 3-year policy to lock rates.
Steps to Buy & Renew
Purchasing or renewing your car insurance is simple.
- Visit the insurance website.
- Enter car details and select IDV.
- Choose plan and add-ons.
- Pay premium online.
- Download policy instantly.
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