What Is The Purpose Of Car Insurance?

According to recent vehicle sales statistics, over 4 million cars were sold in India last year. This is a huge number, and it makes it clear that cars are one of the most preferred forms of transport in the country. With the high number of vehicles on Indian roads, the government has taken steps to ensure smooth flow of traffic and fewer accidents. To this end, the government introduced a set of strict traffic rules that every vehicle owner should adhere to by introducing.

According to the Motor Vehicles Act, 1988 every vehicle on the road should have valid car insurance. This should be purchased at the time of registration of the vehicle.

These days, due to the advancements in technology, you no longer have to visit the insurance company’s office in person to get more details about the insurance policy or purchase it. You can easily find all the necessary information about various insurance policies on the insurance company’s website or third party websites. This is a simple process, and you can get the insurance plan of your choice from the comfort of your home. Many insurance companies also tend to provide special discounts if the insurance is purchased online.

Why Should You Buy Car Insurance?

There are various reasons you should purchase car insurance this year. These are:

a) Financial security

If you meet with an accident, you won’t have to use up your savings to repair your car. The insurance company will pay for the damages.

b) Additional cover

You can opt for various additional covers along with your insurance policy. These come at an additional cost but, can be useful based on your requirements. The most popular covers include consumables cover, zero depreciation cover, roadside assistance, key replacement, etc.

c) No claim bonus

No claim bonus is a vital benefit you receive if you haven’t filed a claim in the previous years. You will get a certain discount on the insurance premium for the following year. This percentage varies from one insurance company to another and usually ranges from 20% to 50%.

d) Unforeseen Circumstance

In case your car gets damaged due to any manmade disasters, natural disasters, riots, burglary etc. the insurance company will compensate for the damages caused to the car.

e) Third Party Liability

If you have valid car insurance at the time of the accident, you need not pay for any third party damages caused by you. The insurance company will pay them for the damages.

Different Types of Car Insurance

When you are looking for car insurance in India, you will have to choose one from the following two types:

a) Third party insurance

As per the law, you need to have at least a third party insurance for your car. In this type of insurance, the insurance company will pay for all the damages suffered by the third party involved in the accident. This includes physical damages and damages caused to their vehicle. The repair expenses for fixing your vehicle and your medical treatment expenses are not covered under this type of insurance.

b) Comprehensive insurance

Similar to the third party insurance, in a comprehensive insurance policy, all the damages suffered by the third party is covered by the insurance company along with the damages caused to your vehicle too. This way, you need not use your savings to fix your vehicle in case of a mishap. You can also opt for an additional rider that includes a personal cover as well which will cover your medical expenses.

The insurance premium for a comprehensive insurance policy is higher than third party insurance but, it also has additional features when compared to third party insurance. Ensure that you compare the features, benefits, terms, and conditions of both types of insurance policies to get an insurance policy that suits all your needs.

A Basic Requirement

Many car owners consider insurance as a needless expenditure that may or may not benefit them in the long run. However, an important factor that they do not consider is that an accident can happen at any time even if you follow all the traffic rules. In situations like these, you will be under a financial burden. The financial burden can be reduced if you have valid car insurance in 2018. You can compare various car insurance policies available in the market and purchase one on

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