The Ultimate Guide to Buying Car Insurance Online

Insurance needs no introduction. It is a safety net that protects you against financial losses in the case of a disaster or an accident. We insure our lives, health, home, etc. to minimize the economic impact of any untoward incident. However, most of us don’t take car insurance so seriously. Since the Motor Vehicles Act, 1988 mandates all car owners to purchase an insurance policy for their new cars, most people buy one just to keep up with this mandatory requirement. However, car insurance is much more. Today, we will offer a comprehensive guide to help you buy car insurance online.

What is Car Insurance?

Car insurance offers protection against financial losses arising from accidents, theft, etc. When you buy a car insurance policy, the insurance company offers to compensate for your losses against the payment of a premium amount. This premium can vary based on the make and age of your car, type of insurance coverage, etc. 

Types of Car Insurance

While there are many variants available, there are two basic types of car insurance policies:

  1. The mandatory third-party car insurance – This insurance is mandated by the Motor Vehicles Act, 1988 to ensure that if your car crashes into another car, then the car owner can receive compensation for the damages without causing a financial burden to you. However, this does not cover any damages to your car during the accident.
  2. Comprehensive car insurance – While comprehensive car insurance is not mandatory, it is recommended to ensure that any damages to your car don’t burn a hole in your pocket. These plans offer protection to you as well as any damages caused to a third-party vehicle. While this sounds unnecessary to most new car owners, they realize its importance once they receive the bill for car repairs after an accident. 

Understand the jargon before you Buy Car Insurance Online

Like most financial products, car insurance documents have some heavy financial jargon. As a layman, these terms can be confusing and misleading at times too. Hence, it is important to understand them before you buy car insurance online. Here are some common terms:

  • IDV or Insured Declared Value – IDV is the market value of your car in its current state. It is also the amount you receive if your car is stolen or damaged beyond repair (total loss).
  • NCB or No Claim Bonus – Most reputed car insurance companies like TATA AIG offer a No-Claim Bonus – a reward for not claiming insurance for the entire policy term. Usually, this is in the form of a discount while renewing your car insurance.
  • Zero Depreciation Cover – Usually, car insurance schemes consider depreciation while determining the payable amount. However, some companies offer a Zero Depreciation Cover as an add-on that ensures that you get the full payment without depreciation.
  • Deductible –This is the amount or percentage you agree to pay while receiving the final settlement. 

Step-by-Step Guide to BuyCar Insurance Online

If you are planning to buy car insurance online, then be prepared to be overwhelmed with a wide range of options. All insurers will claim to be the best and offer some attractive features that would seem too good to resist. However, it is important to assess some basic parameters before buying. Here is a step-by-step guide to buy car insurance online:

  1. Understand the options available to you, as explained above.
  2. Research insurance schemes and compare them online. Look for factors that are important to you. So, if you frequently drive across cities, then you might want to pick an insurance company that has a network of cashless garages across the country (including smaller cities and towns). Look for insurers with higher claim settlement ratios.
  3. Based on your needs, pick the right kind of coverage. For example, if you live in a congested area and scratches are common, then your insurance must cover the cost of repainting the car too.
  4. Pay attention to the IDV of your car. All calculations of premium are based on the IDV. 
  5. Go through the entire list of add-ons. Most insurers offer basic schemes to reduce the premium amount and offer important features via add-ons. While these might come at a small cost, the benefits can be worth the extra money.
  6. Buying car insurance online:
    1. Once you have finalized the policy, visit the insurer’s website
    2. Fill the online application form
    3. Select the type of cover
    4. Choose add-ons
    5. Upload documents
    6. Make the required payment
    7. Receive the policy document on your registered email address

Also, ensure that you read all fine print before signing the dotted line. Many people skip this part and find their policy lacking when the time for the claim arrives. Hence, ensure that you are covered across various scenarios.

Conclusion

Car Insurance is a safety net that ensures that an accident or untoward incident does not cause financial losses. Before buying a scheme, ensure that you assess your insurance requirements too. One size does not fit all – assess what you need and find the perfect scheme for you. With the right car insurance, the next time you are behind the wheel, you can allow the driver in you to evolve without worry. Safe Driving!

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