When you purchase a car, you have to buy insurance to protect your car against damages. We often get confused about the type of insurance we need to buy. There are many different types of insurance in the market from various companies. Therefore, choosing from different types of insurance and insurance companies becomes difficult at times. This article will help you choose the best car insurance you can buy depending on various factors like the age of your car, brand, condition of your car, etc.
Everyone wants to buy the most affordable car insurance from the best car insurance company. But, due to the competition in the market and the cunning mindset of insurance salesmen, it becomes difficult to get the best car insurance.
There are a lot of websites that help us compare the best car insurance and policies offered by many companies in the market. Even though these websites help you get the best price for the specific type of insurance among the different types of insurance you want to buy, it is not enough. Because what these websites and insurance salesmen don’t tell is the type of car insurance your car requires.
There are many types of car insurance available in India. These different types of insurance cover damage to your car at different levels. The price of insurance is directly proportional to the extent to which they cover damages. Usually, we think that the cheapest type of insurance is the best car insurance. But, the cheapest type of insurance won’t cover expenses like theft or flooding, etc.
So, there are many factors on which the type of insurance you need to buy depends. You need to consider these factors before buying the best car insurance for you. Insurance company salesmen trick you into overbuying your insurance. They tell you about various attractive features offered with the more expensive insurance. But you need to consider what features of insurance do you really want.
There are 5 different types of insurance in India-
In India, buying this type of insurance is compulsory. This insurance covers any type of damages of the third party if you get into an accident. You can claim this insurance only if it is concluded that the accident was not your mistake/fault. Liability Coverage covers-
It is compulsory for every car buyer to buy this insurance. It is recommended to buy a more expensive liability coverage as it helps you pay less for third-party damages.
Sometimes it happens that when you go through an accident which is not your fault. And the person at fault is uninsured or underinsured. In such cases, if no insurance policy covers the damage, this type of insurance helps you pay for your medical and vehicle bills which either won’t be covered (uninsured) or partially be covered (underinsured) by the person who caused the accident. Uninsured and Underinsured coverage covers-
It is a personal choice to buy this type of insurance. It is better to buy because it gives a sense of security to you that you won’t have to spend a lot in case of an accident. In India, everyone takes the cheapest liability insurance to save their money.
Usually, the liability and collision coverage covers most of the expenses in case of damages by accident. Even if they don’t the remaining amount is very less and giving a premium every month is not a very smart choice especially of your car manufacturer is Maruti, Hyundai, other low service cost brands.
So if your car brand is
a. Toyota, Maruti, Hyundai, Ford, Renault, other low service cost brands- You should not buy this type of insurance
b. Skoda, Volkswagen, All luxury brands(BMW, Mercedes, etc)- You can consider uninsured and underinsured coverage because the parts are very expensive and this coverage can come in handy at the time of a major accident.
This type of insurance coverage is the most basic coverage that most people buy or are tricked into buying. This insurance covers accidental damages. Collision coverage covers-
Note- This type of insurance usually involves the highest tricks and twisting of words. Hence, you should read the insurance agreement very carefully. Usually, insurance companies exclude high-cost car parts like glass items such as windows, headlights, windshields, etc.
So, when you go to claim your insurance, the most expensive parts are not covered and even after buying an expensive insurance policy, you get a hefty bill.
a) If the car is less than 3 years old – Everyone should buy Collision coverage for the first three years.
b) If the cars age is between 3 and 6 years – If you own a car with less expensive parts, you should decrease your collision coverage premium.
If you own a car with more expensive parts(eg BMW, Audi, Skoda, Jeep, etc.), you should buy collision coverage at a higher premium. This is because car parts are expensive and in case of a heavy accident, buying all parts out of your pocket can be tough.
c) If the car is greater than 6 years – If own a car with less expensive parts,m you should decrease or remove collision coverage. This is because, after 6 years the value of the car decreases a lot. Investing in the car is not a wise option unless you are attached to your car.If any part breaks or stops functioning buying from your own pocket is better than giving a premium for 12 months.
If you own a car with expensive car parts(eg BMW, Audi, Skoda, Jeep, etc.), you should buy collision coverage at a moderate premium. Because, car parts are expensive and in case of a heavy accident, buying all parts out of your pocket can be tough.
This insurance cover almost all types of damages your car can possibly go through in its life span. It includes all accidental damages including third-party damages. Therefore, it has a very high premium compared to other different types of insurance. Comprehensive coverage covers-
Anyone who lives in an area with a high theft rate or with a chance of flood or fire( eg mountains) should buy this coverage.
When you cause an accident and need medical treatment, this insurance is useful. They cover almost all medical bills like x-ray,ct scans, etc. Personal Injury Coverage covers-
Again this is a personal choice. Buying this insurance makes you feel secure that at the time of emergency, the insurance will help you pay bills.
These are the basic different types of insurance and who should buy them. You can choose individual types of insurance and make your own insurance policy which will cover damages from all different types of insurance that you choose. You should read the insurance terms and conditions properly because insurance companies leave out cover for expensive damages like windows, headlights, etc.
Q)Does car insurance cover theft?
A) Comprehensive Car insurance covers loss due to theft.