MUMBAI, INDIA / ACCESSWIRE / May 22, 2020 / The car insurance policy works basis on "use it or lose it" system. One buys car insurance and pays a yearly premium towards the plan. Not claiming for insurance in a year helps in getting no claim bonus which is almost 20% discount on premium in the first year and 50% in the 6th year.
Here are the key things that are important to know before buying an online car insurance plan.
- Choose the policy according to needs
There are two types of online car insurance available - third party car insurance and comprehensive car insurance. While the third-party car insurance only covers the third-party perils, comprehensive car insurance policy covers damages to third-party as well as to own car. However, third-party car insurance is mandatory as per the Motor Vehicles Act of India.
- Set the right IDV
The policyholder would need to give the IDV value only if he buys the comprehensive insurance policy. The insurer considers the IDV value for coverage amount in case the vehicle suffers heavy damage or a complete loss due to theft.
To set the right IDV value is paramount before finalizing insurance plan as setting too low IDV would decrease the claim amount and too high IDV would raise the insurance price.
- Choosing the higher deductible reduces claim amount
The deductible is a small amount paid by the policyholder to the insurer at the time of settling claims. The two kinds of deductibles are compulsory deductible and voluntary deductible. Only voluntary deductible allows choosing the amount that one would be willing to pay at the time of claim settlement. Safe drivers generally select a higher deductible, but this also reduces the claim settlement amount.
- Selecting the Add-ons that would be useful
If one decides to opt for comprehensive car insurance, he/she will get the option to choose add-on or additional coverage for your vehicle. It would be wise to choose the add-ons that the car would need the most as this will raise the price of the insurance.
Renewing car insurance on time would help to keep the NCB (No Claim Bonus) active. Failing to keep the policy active at all times would lead to loss of accumulated NCB and also is a punishable offence. Also reading through the terms and conditions is mandatory before finalising one policy.
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SOURCE: Millennial PR