In Indian culture, buying a new car brings excitement to the whole family. It means good luck, fulfillment and the beginning of those trips that you have planned with your family in your new car. In excitement about a new car, people generally ignore that buying a new car is not only a matter of pleasure, but also a great obligation.
If you analyze carefully, you will find out that owning a car or buying a new car is a big responsibility, because we have to make sure that we don’t get anyone out of our car while driving. In the event that we do this, we need to have proper insurance coverage for both our car and the third party to guarantee compensation.
Not only is it our responsibility to have car insurance, but it is also a legal requirement to have third party liability insurance under the Motor Vehicle Act. There are a number of insurance providers in the market that offer different types of auto insurance, but we have to consider the best suitable plan for ourselves. To buy the right auto insurance, we need to compare it before deciding which policy to buy. For which there are a few things we should keep in mind:
Make a list of your requirements: Before buying car insurance, it is very important that you first decide what you need in your car insurance policy. Just list the kind of coverage you’re looking for in a policy, such as TPL, IDV, add-ons, and so on.
Coverage Comparison: Once you are done with the short list of your requirements, compare the policies online. In addition, the type of coverage offered with third-party liability insurance is different than with a comprehensive policy. Liability only covers loss and damage caused to the third party while the comprehensive policy gives you full coverage which includes TPL, vehicle damage and personal accident. It is therefore advisable to compare car insurance carefully before buying.
Compare IDV: The premium rates are based on the IDV (insured declared value) of the car, ie the current value of your car after a fixed depreciation. The IDV of a car depends on the age of your vehicle, the older the car, the higher the premium.
Premium: Another important factor in choosing the right auto insurance policy is a policy premium that you have to pay to the insurer. Some auto insurance policies may be available at very competitive rates, but a low premium doesn’t mean it’s a better policy. You should compare the features and benefits of the policy before making a final decision. If you get better coverage by paying some extra cost and it is really worth it for you then you should opt for the same. Keep in mind that the premium of a car insurance policy is always determined by multiple factors such as model, age, vehicle type, capacity, fuel type, etc.
Compare CSR of the insurer: Always compare the CSR of the insurer where you plan to buy a policy for your car. You must take out a policy with a provider whose (CSR) claims settlement ratio is good. Do not buy a policy from a company with a low claims settlement ratio. Every year, IRDA releases a detailed report on the claims settlement ratio, which you can easily obtain from the IRDA website.