Car owners should invest in a good car insurance policy and be prepared for any untoward incident in the future. The way a car policy works is that the car owner pays an annual premium to an insurance agency and in return the agency pays for losses to the owner in case of accidents.
Third-party car insurance means that the insurance agency will take care of expenses of a third party who may suffer personal or property loss because of an accident caused by the car owner. In case of a comprehensive car insurance, apart from the third party, the car as well as occupants of the car are also insured by the agency.
Best Car Insurance Companies in India
Several banks, non-banking financial institutions as well as insurance agencies offer attractive car insurance policies. Here are some of the top insurers:
HDFC Ergo: The HDFC Bank’s insurance wing offers insurance policies for cars. Third party cover for up to Rs 7.5 lakh is available. It boasts of a 100 percent Grievance Redressal Ratio. Apart from this there is a 24×7 support available to car owners.
National Car Insurance: The insurance agency incurred a claim ratio of 121.67 percent. As a special bonus for those who have not made a single claim during the policy period, the agency offers special discounts.
United India Car Insurance: A claim ratio of 91.72 percent was incurred in the financial year 2017-18. You can locate the nearest network garage on the website of United India Car Insurance. The insurance agency also offers a personal accident cover apart from a third party and comprehensive car policies.
New India Assurance Company Ltd: The insurance agency incurred 79.68 percent claim ratio in the year 2017-18. A dedicated grievance redressal mechanism registers grievances in 72 hours and settles them within a fortnight. Claim request is assessed and approved within 72 hours.
ICICI Lombard: Free pick up and towing facility apart from 24×7 assistance. The agency completes loss assessment within four hours of the accident and also offers a six-month assurance on all repairs done at any of the network garages.
Things to Know While Choosing a Car Insurance Company
Before you make a decision on which insurance policy to invest in, it is important that you compare the features of the policies available to you in the market.
Here is a list of things that car insurance policies cover:
Loss/ damage due to natural calamities: Any damage to you car due to a natural calamity such as lightning, earthquake, flood, typhoon, hurricane, storm, cyclone, landslide, etc, is covered by the car policy.
Loss/ damage due to manmade calamities: Your car can be insured against burglary, theft, riot, strike, terrorist activity, and any damage caused in transit via road, rail, or water.
Personal accident cover: This is an insurance for you and your family members if an accident leads to permanent disablement or death.
Third party legal liability: In case an accident causes permanent disablement or death of a third party, the insurance policy protects you against any legal liability.
Engine cover: This is an add-on feature in which the insurance policy protects you from expenses incurred when the car’s engine is damaged.
Zero Depreciation Cover: This is also an add-on benefit in which the insurance company waives off any depreciation on a replaced car part.
Roadside Assistance Cover: This, too, is an add-on feature. If you are stranded on the road because of an accident or because your engine has failed or because of a flat tire, you can ask for a car mechanic sent to you to the place where you are stranded.
The insurance agency does not pay for damages caused to the car due to negligence. The insurance policy will not work if the accident is caused because of drinking and driving. It will also not work if the car is driven by an uninsured person or if the damage is caused by the owner deliberately.
List of all Car insurance companies
There are many insurance agencies in the country that provide car insurance policies. Here is a list of some of these companies:
Bharti Axa General Insurance
The New India Assurance
Reliance General Insurance
State Bank of India General Insurance
United India Assurance
What is IDV?
The Insured Declared Value (IDV) is the current market value of your car based on which your policy amount is decided. It is the maximum policy amount that you can receive.
When you purchase a car insurance policy, the insurer will determine the IDV of your car based on the registration details, date of registration, make and model of the car, the cubic capacity of the engine and the ex-showroom price of the car.
Do not downplay your IDV in order to pay less premium. This would entail that at the time of accident, your claim amount would be clipped. If a car is older than five years, the IDV of the vehicle is decided mutually by the owner and the insurer. For a brand new car, for the first year a 5 percent depreciation is considered. At the start of the second year, a 20 percent depreciation is considered. In the third year the depreciation goes up to 30 percent. For the fourth and fifth year the depreciation are 40 and 50 percent.
What is partial claim settlement?
In a case where the insurance agency finds that the claim amount is higher than the damages, the agency may agree to pay a part of the claim amount. This is called partial claim settlement. It usually happens after the agency representative surveying the damages of your car finds that the cost of repairs will not be as much as the claim amount.
Why was my claim rejected?
There can be numerous reasons for your agency to reject your insurance claim. One of the most common reasons for rejection is that the car owner makes the repairs without informing the insurance agency. It is therefore of utmost importance that the insurance agency is informed of the accident at the earliest.
Most insurance agencies require you to inform them of the accident within a specified limit. Some ask you to inform them within 48 hours of the accident. If you don’t inform the agency in time, you will lose your chance to claim.
Make sure to carry your driving licence at all times. If you did not carry your licence at the time of the accident, the insurance agency will not entertain your claim.
If you were driving under the influence of alcohol or drugs at the time of the accident, your claim will be rejected. Yet another reason for rejecting claims is if the application process is not adhered to and if the documentation is wrong.