3 Reasons to Consider Switching Your Car Insurance Policy

Investing in a car insurance policy is essential for car owners to enjoy stress-free rides. However, you might realise that the policy is not the right fit for you only after buying it. In such cases, you can easily switch your insurer and pick a better policy. Car insurance can be ported without losing out on the No Claim Bonus (NCB), making it a profitable solution for moving out of bad policies. You can switch your insurer around the time of renewal of your current policy. The process requires less paperwork and substantially lower processing time when compared to porting a health insurance policy.  

A comprehensive motor insurance policy consists of two parts i.e. Third Party and Own Damage. The Third-Party component is mandated by the Insurance Regulatory and Development Authority of India (IRDAI) making it fixed in nature. However, the Own Damage section contains various sub-components that differ from one insurer to another. When investing in a policy, pay attention to the second component to make sure it fits your needs.  

Reasons to Switch Car Insurance 

You should consider changing your insurer if you can relate to any of the following scenarios:  

•  Better deal: If your current plan doesn't cover your needs, you should search for better deals available in the market. When buying a policy, look out for plans that provide a wider coverage with necessary add-ons. If you already have a plan that covers all your needs and has essential add-ons like NCB protection, zero depreciation, etc., you can still switch your policy to a plan which provides all that at a cheaper premium.  
• Service: Buying a good plan is the first step of the journey. Things can go wrong even after you invest in what seemed like a sound policy. The real test of a policy begins when you make a claim. After buying the plan, you might find that your local garage is not in the insurer's network. This takes away the option of a cashless transaction from you. Even if you make the payment from your pocket, reimbursement might take a while. These experiences can prove to be a hassle. Therefore, it is imperative to read the finer details when buying a policy. Switch to an insurer who has a good network in your location as it'll mean worry-free claims for you.  
• Insured Declared Value: The Insured Declared Value (IDV) is the payout you will get from the insurers in cases of theft or irreparable damage to the car in an accident. According to the guidelines set down by the IRDAI, the IDV is calculated keeping the age of the vehicle in mind. The policy premium also depends on the IDV. While buying a plan, it might be tempting to settle for a policy with cheaper premium. However, insurers might compromise the lower premium with a decrease in the IDV. You should not settle for anything lower than a fair value of your vehicle as it might land you in financial woes when you file the claim. Choose a policy that gives you the ideal value of your car as the IDV.  

Investing in a bad deal doesn’t mean you have to carry forward with it against your will. A simple switch to a better policy can help you considerably. Choose a policy that suits your needs and budget while providing a satisfactory coverage. 

Car Insurance: It’s Features and Benefits

The Motor Vehicles Act mandates each and every vehicle registered in the country to have a valid insurance policy. While it is true that most people insure their vehicles because of the government mandate, but it also has a lot of benefits that should be given equal importance. Your vehicle insurance policy cannot be compared to other insurance products that offer an assured sum in return on maturity of the policy. General perception of buyers is that, car insurance policy leeches off a certain percentage of the income; whereas in reality, it offers protection against unforeseen circumstances which are often neglected in financial planning.

Here are some of the key benefits of your auto insurance policy:

Covers for road mishaps

Your insurance policy will compensate for the cost of repairs if your vehicle was involved in an accident. In addition to that, it will take care of the medical expenses of the rider, if he/she has sustained severe injuries that require hospitalization. Make sure that you check the capping on medical expenses at the time of purchasing the policy.

Pays for replacement if your vehicle is stolen
You come out of your home with keys in hand and get shocked finding that your car went missing. It definitely is one of the worst feelings to find your favorite possession being stolen away, but with a vehicle insurance cover, you don’t have to panic. So, if you have a comprehensive insurance plan for your car, then you just have to file an FIR with the police and approach your insurer for settlement of claims. Upon verification of the documents provided, your insurer will reimburse the value of the stolen car.

It covers for third party liabilities

Your insurance policy does not only cover you and your car, but it also offers protection from legal liabilities arising due to damages caused to third party. Generally, insurance policies cover third party liabilities such as bodily injury, damage to vehicle, death, and permanent disability.

Covers for damage due to flood

Flood water can cause sufficient damage to your vehicle’s upholstery and even to mechanical components. So if you live in flood prone areas, you should opt for a comprehensive insurance plan that will reimburse for flood damage repairs.

It will pay for damages due to fire

Vehicle fires can occur due to a number of reasons and it will definitely do a lot of damage to the interior as well as exterior. A comprehensive vehicle insurance plan will cover for all damages due to vehicle fire, regardless of what caused it.

No-claim Bonus

Your vehicle insurance policy also offers a no-claim bonus if you do not make any claims during the policy period. The no-claim bonus amount varies from one insurer to another, and it is offered during policy renewals. Some companies provide a discount on the insurance premiums for the year which preceded a non-claim year. Which means, for each year you are insured without making claims, you will earn bonuses for the following year.

Types of coverage offered under vehicle insurance policy

Your vehicle insurance policy offers various types of coverage with each one having different benefits. However, additional features covered under the plan will have a price tag of its own. Given below are some of the common types of coverage offered by an auto-insurance policy:

•     Liability Coverage
•     Collision Coverage
•     Comprehensive Coverage
•     Personal Injury Protection
•     Medical Reimbursements

Types of Car Insurance Policies in India

The government of India mandates that auto insurance is a necessity for all vehicles on the road. Car insurance can protect the car owner against financial liabilities caused by an unfortunate vehicular accident or theft. New cars come with a standard insurance policy which has to be renewed after one year. A premium amount has to be paid every year to keep the policy active. There are 2 types of car insurance policies in India; third party insurance and comprehensive insurance package. A car owner should choose the one that best serves his or her needs. The cost of car insurance is determined based on the make and model of the car, the year of manufacture, and the geographical location.

Third-Party Insurance: This type of insurance policy covers the damages to a third party in the event of a vehicular accident. As per the law, all vehicles have to have a third-party insurance policy. The insurance premium is calculated based on the cubic capacity of the car engine. The premium is usually lower compared to a full coverage policy.

Comprehensive Insurance Package: This type of insurance policy covers third party liability and damages to the car in the event of a vehicular accident, natural calamity or theft. The premium is calculated based on the insured declared value of the car. The premium amount for this type of policy is usually high.

The premium of a third party insurance will remain the same but in a comprehensive package, the premium amount may reduce over the years due to the depreciation of a particular model of car. For used cars that are over 5 years old, the insurance premium is determined by a mutual agreement between the car owner and the insurance provider.




Choose the Right Car Insurance Policy

At the time of car insurance policy renewal, car owners get the opportunity to change or update their existing insurance policy. Car owners should determine whether they want a full insurance coverage or minimum coverage for their automobile. There are several websites dedicated to compare car insurance quotes. Listed below are some reputable insurance providers in the industry:

TATA AIG offers many add-on covers, has a Green Channel Settlement facility for making easy claims, and comes with an auto-restore warranty. Other features of a TATA AIG car insurance includes cashless claim settlements at TATA garages and free car pick-ups. The policy claims can be settled in 7 days.

ICICI Lombard offers cashless claim settlements in its network garages across the country, a 24/7 roadside assistance cover, and a daily allowance of Rs.500 when the car is in its garage. ICICI Lombard car insurance can be purchased online via EMIs.

L&T offers coverage for alloy wheels, seat covers, air conditioner, music system and other car accessories. It offers Rs.2 lakhs coverage for 5 passengers in the case of a personal accident. The insured will get Rs.500 discount on installation of anti-theft devices. Another feature of L&T’s comprehensive car insurance includes coverage extending beyond the geographical boundary of India.

BAJAJ Allianz has an app called the Insurance Wallet for customers to view and manage their policy documents, locating a nearby network hospital or garage, and initiating a motor claim from anywhere at any time. Another innovative app called the MobiFuel can be used to manage service records and mileage of the car, and receive alerts for refuel and insurance renewal. Bajaj Allianz also offers towing facility and cashless claim settlements in its network garages.

Future Generali offers several add-on covers with its car insurance policies like the lock and key replacement cover and inconvenience allowance cover for when the car is in its network garage.

Car owners should always compare a list of car insurance quotes before choosing a suitable one. You can purchase customized car insurance policies to better suit your needs.