In Indian culture, buying a new car brings an excitement in the whole family. It means lots of happiness, fruition and the beginning of those tours which you have been planning with your family in your new car. In excitement of a new car, people generally ignore that buying a new car is not only a matter of fun, instead it is a big liability.
If you analyze carefully, you will come to know that having a car or buying a new car is a matter of big responsibility, as we have to ensure that we do not hit anyone from our car while driving. In case if we do so, we should have proper insurance coverage for our car as well as the third-party to ensure compensation.
It is not only our responsibility to have a car insurance but also it is mandatory by law to have third-party liability insurance under the Motor Vehicle Act. There are a number of insurance providers available in the market, who offer a different kind of car insurance policies, but we should consider the best suitable plan for ourselves. To buy the right car insurance, we must compare it before deciding on which policy we should buy. For which there are a few things we should keep in our mind:
Shortlist your requirement: Before buying a car insurance, it is very important that first you should decide that what you need in your car insurance policy. Just make a list of the kind of coverage you are looking for in a policy like how TPL, IDV, add-ons and so on.
Coverage comparison: Once you are done with the short listing of your requirements, compare the policies online. Moreover, the kind of coverage offered in a third-Party liability is different from that of comprehensive policy. Liability only covers any loss and damage caused to the third-party, whereas the comprehensive policy offers you a full coverage which includes TPL, damage to the vehicle and personal accident. So, it is advisable to thoroughly compare car insurance policies before buying.
Compare IDV: The premium rates are based on the IDV (insured declared value) of the car which means the current value of your car after a set depreciation. The IDV of a car depends on the age of your vehicle, the older the car will be, higher will be the premium.
Premium: One more important factor in choosing the right car insurance policy is a premium of the policy which you have to pay to the insurer. You may find that some of the car insurance policies are available at very competitive rates, but low premium does not mean that it is a better policy. You should compare the features and benefits of the policy before taking any final decision. If you get better coverage by paying some extra cost and it is really worth for you, you should opt for the same. Keep in mind that car insurance premium is always determined by multiple factors like model, age, type of vehicle, capacity, fuel type etc.
Compare the CSR of the insurer: Always compare the CSR of the insurance company from where you are planning to buy a policy for your car. You should purchase a policy from that provider whose (CSR) claim settlement ratio is good. Do not purchase a policy from a company with low claim settlement ratio. Every year, IRDA releases a detailed report about claim settlement ratio, you can easily get it on the IRDA website.