CAR INSURANCE TIPS

Your vehicle is your prized possession and protection of the same is imperative.If you own a car in India and want to take it on the road, you must compulsorily possess an insurance cover which will cover damages caused by your car to third parties.When purchasing a car, auto insurance is a mandatory legal reguirement.According to the statistics of 2014 for India, more than 70% of motorcyclists  and 33% of the car owners do not have motor cover policy.Currently the fine is just Rs1000 for all vehicles.Most people do not know that vehicle insurance is mandatory.While this type of insurance is a straightforward contact between two parties, there are few things you must know about car insurance.

TYPES  OF  POLICIES-

Pre-dominantly in India, there are basically two kinds of Motor Vehicle Insurance:

1. MOTOR POLICY TYPE: A- (THIRD PARTY RISK)- Which are also known as Third-Party Liability or Limited Liability Policy,is mandatory compulsory under the law.It covers the policyholder against damage to third-party's life or property,caused from your vehicle.In otherwords, here your insurance cover is provided to the person or property damaged by your vehicle.A third-party insurance policy does not cover the cost of repairing your own vehicle.The Policy covers third party damages up to Rs.6000 only.Risk from fire and theft requires an additional premium.
   
2. MOTOR POLICY TYPE: B- (COMPREHENSIVE  INSURANCE  POLICY)-         better known as the Comprehensive or Packed Motor Insurance Policy, provides cover for any loss or damages to the vehicle insured, along with third-party insurance.This policies comes with 'Deductible Option', wherein the policyholder volunteers to share a percentage of losses during claims.The voluntary deduction helps in reducing the premiums of the insurance policy.The policy protects you from the following eventualities:-

         Damages due to man-made or natural calamities:

• Natural calamities includes fire,hurricanes, landslides,cyclones or earthquakes.
• Man-made calamities includes theft, riots, strikes, damages occuring in transit via road, rail, waterways or air.

PERSONAL ACCIDENT COVER-

In the event of an accident, it is important that you have personal accident coverage.You may also opt for a personal accident cover for passengers travelling with you, just to be on the safe side.

THIRD PARTY LEGAL LIABILITY- 

• This would cover you for legal liabilities that result in permanent injury/death or damage to property, in the event of a mishap.
• While purchasing a used car, not only do you have to transfer the registration to your name,you also need to transfer the vehicle insurance cover, all within 14days of purchases, for such a cover to remain valid.
• The insurance policy is valid for  a period of one year.
• If you do not make a claim during this period of the policy, you are eligble for a discount, which is adjusted against the renewal premium.
• Incase your policy expires, you can still avail the no claim bonus if you renew the policy within 90 days of its expiry. The following rates of discount apply:

1. First year- 20%.
2. Second year- 35%.
3. Third year- 50%.
4. Fourth year- 65%.

• More importantly, if  you don't make any claim for  a few years in a row, the insurance company can reduce your premium by maximum of 50%.Stick to the simple formula that if the amount spent on repairs is lower than the no-claim bonus that you can potentially accumulate, do not make a claim.
• Car insurance premium is not a fixed amount for all car models or policy holders.It can go down from the standard rate when you opt for group discounts or when you take all your insurance policies from the same insurer.
• This insurance policy doesnot cover your vehicle under the following circumstances:

1. Damages arising out of mutiny,nuclear risk or war.
2. Mechanical/ Electrical failure.
3. Wear and tear of car tires and tubes.
4. Vehicles being used other than the purpose for which it was purchased.
5. Damages occured from driving witout valid license.
6. Damages occured from driving under alcohol or drug influence.
7. Everyday wear and tear.

• To submit the claim you need to provide the following documents to the insurance company:
• Vehicle insurance Policy.
• Original and Copy of the registration book.
• Original and Copy of the Driving License.
• FIR in case of an accident involving third party injury or damage.
• Claim form and estimated cost of repairs from the workshop.

Once the above mentioned documents are submitted, the insurance company will inspect the damaged vehicle and authenticate the estimate cost of repairs.Once surveyor has completed the inspection,and sanction of the amount is obtained,  the car can be repaired.

EXCLUSIONS-

Exclusions are conditions in which no claims will be paid  to the policyholder.Some most common exclusions of insurance policies are mentioned below:

• If driver is under the influence of alcohol,at the time of accident.
• Vehicle being driven by a person not holding a valid driving license.
• Vehicle not being used as per limitations of use.
• Mechanical or electrical breakdown, failure, etc, which fall under specific exclusion.

It is always recommended to research car Insurance options available in the market,compare the features and cost of insurance and then make your choice.

HAPPY AND SAFE MOTORING!