A vast majority of us are quite passionate when it comes to our vehicles. In fact, owners do not hesitate a bit to go the extra mile when it comes to enhancing their vehicles or buying the most appropriate accessories. However, amidst all of this taking care of a vehicle, one must not forget the most important safety measure, a motor insurance.
When you drive your vehicle out of the showroom, in all certainty, the dealer would offer you a motor insurance. But a small caveat in all this is that the policy is only valid for a duration of one year. After the completion of the first year, one must renew the same. Irrespective of whether it is a renewal or a new policy, it is important to have a valid insurance for your vehicle.
Types of Motor Insurance
Even though there are a lot of insurers available for you to choose motor insurance plans from, the types of policies available are limited. You can either buy a third-party liability policy or a comprehensive policy from any of the insurers.
Third Party Liability
The Motor Vehicle Act of 1988 mandates all vehicles to have at least a third-party liability cover. As the name suggests, the policy takes care of any damages or injuries to third parties involved in an accident. In the unfortunate event of an accident, the insured is the first party, the insurer is the second party and any other individual or property involved is the third party.
This policy ensures that any legal issues or expenses arising out of accidents are taken care of. Another fact which makes this policy accessible is its low cost. Since these policies do not have any other components, their cost is low. Also, the IRDAI or Insurance Regulatory and Development Authority of India decides the premium prices.
While it is just enough to offer you credibility to drive or ride on the road, it doesn’t offer a great deal apart from the above. Meaning, if you want to claim for your damages, you cannot do the same.
A comprehensive policy is the other type of insurance that you can buy for your vehicle. Again, as the name suggests, it offers a more complete package. In simple terms, it offers third party liability and own damage cover as well.
You will end up paying slightly higher premiums for a comprehensive policy as compared to a third party liability plan. For the additional money you get coverage against natural calamities. Should there be any damages to your vehicle due to flood, cyclone, earthquake, landslides and so on, the policy will cover up for the same.
Similarly, if there are any nuances caused by men, the policy covers the same. Events such as theft, burglary, vandalism, riots, malicious intent and so on are all part of a comprehensive cover. Most of the insurers also offer personal accident cover for the drive of the vehicle.
And most importantly, you can opt for riders only in a comprehensive plan. Riders are additional features that you can plug into your existing motor insurance plan by paying an additional premium. They let you enhance the capabilities of your policy by paying a marginal premium. And of course, with a comprehensive plan you can claim for own damage as well.
Save Money on Premiums
There are quite a few small steps that you can take to ensure that you do not pay a high amount as the policy premium. Here are a few of them.
- Security Devices
When you install certain security devices on your vehicle, the probability of it being stone or burglary cases reduce drastically. Insurers acknowledge the same and offer discounts on insurance premiums.
Insured Declared Value is one of the major parameters that decide the premium of a vehicle. while buying a policy you have the option to play around with this value. Quite naturally, if you reduce the IDV the premium prices come down. However, one must be careful as reducing it to a large extent might have some repercussions at a later stage.
For every year that you do not claim your policy, insurers offer a certain discount known as no claim bonus. The discount starts from 20% for the first year and goes all the way up to 50% for five years.
You must visit a comparison website if you wish to extract the most out of your vehicle policy. You can compare policies based on features, quotes and benefits and pick up a plan that best suits your needs.
The presence of comparison websites makes life easier for someone looking to buy or renew their motor insurance.