A Complete Guide On What Does Car Insurance Covers

Wanna hit the road on your brand new car and experience the thrill of driving like you’ve always desired to? Well, it doesn’t matter whether you’re driving your recently purchased SUV or the old sedan you were gifted by your dad as long as you obtain all the safety measures required to put the pedal to the metal on the road.

You’ve got the car, you’ve got the keys, and all you need now is your insurance papers to ensure that you’re covered whenever an unforeseen situation like a severe accident, damage to a third-party property, and so on, arises. In this article, we will comprehensively discuss everything a car insurance policy seeks to benefit you with.

What does a car insurance policy cover?

Car insurance or motor insurance is made compulsory by law in India. If you’re to drive a vehicle on Indian roads, it is a legal requirement to obtain a minimum level of car insurance. The coverage of your insurance is going to differ from one company to the other, but a list of basic amenities will always be the same on every car insurance policy.

Coverage for third-party car insurance

Buying a third-party car insurance policy is mandatory under Chapter 11 (Sections 145 to 164) of the Motor Vehicles Act, 1988. Here’s all that this type of car insurance seeks to cover.

Third-party property damage

Any type of accidental damage that you cause to the property owned by a third-party person is going to be covered under your third-party car insurance policy.

Cost of treating injuries

The cost of treating injuries, caused due to your insured car, to the third-party person, are going to be covered under your third-party car insurance policy.

Death and permanent disability compensation

In case of death or permanent disability of a third-party person caused by your insured car, his/her family is going to be compensated under the third-party car insurance policy.

Legal liabilities

Legal liabilities that arise due to an event involving your insured car are certainly going to be covered under your purchased third-party car insurance policy.

Coverage for comprehensive Car insurance

A comprehensive car insurance policy offers wider coverage than a third-party car insurance policy. Hence, it is always advised to buy this type of policy to get the best coverage possible.

Also, if you’re someone who wishes to enhance his/her comprehensive car insurance coverage further, you can do so by purchasing certain insurance add-ons quite seamlessly.

Here’s all that a comprehensive car insurance policy seeks to cover.

The entire third-party coverage

A comprehensive car insurance policy includes all the coverage that a third-party insurance policy offers and this has been mentioned above in detail.

Damages to own car

The cost of repairing damages to your insured car can be quite hefty even in India, and depending on the type of damage, you could end up spending a huge sum, thereby depleting a large portion of your emergency savings.

A comprehensive car insurance policy will reimburse you every amount that was required to get your car fixed and brought back to its original shape.

Personal accident coverage

The cost involved in your medical treatment in case you get involved in an accident, will be reimbursed to you as you’re the owner of the insured car.

Theft

The Current Insured Declared Value of your insured car will be compensated to you, as you’re the owner of it, in the event of theft or robbery of your car or the valuable belongings that were inside it.

Fire

Similar to theft or robbery, in case of a fire outbreak, it will be treated as “total loss,” and under such circumstances, you will be compensated with the IDV of your insured car.

Natural calamities

If your insured car is hit by a natural calamity like tsunami, landslide, hurricane, cyclone, flood, rock slide, and so on, you, as the owner, will be compensated for the amount of damage caused.

Man-made calamities

In a situation wherein your insured car gets damaged due to a man-made calamity like, riots, vandalism, terrorism, and so on, you will be reimbursed the entire amount you’d need to repair your car and bring it back to its original state.

Add-ons

When you, as the car owner of an insured car, opt for a comprehensive car insurance policy, you can extend the scope of your insurance coverage by purchasing certain specific add-ons.

Add-ons are additional coverage alternatives that are designed to suit particular requirements.

There are quite a few useful add-ons that are available across numerous insurance companies. Some of these useful add-ons include, roadside assistance, zero depreciation, return to invoice, engine protection cover, NCB protection, and loss of personal belongings.

Coverage for uninsured motorist insurance policy

An uninsured motorist insurance coverage will cover your injuries and your covered car’s damages if a driver without insurance hits you. It also seeks to cover your passengers and family members if they’re hit by an uninsured driver.

An uninsured motorist insurance policy also pays compensation to you if you’re hit as a pedestrian. It’ll pay for your medical bills and other relevant expenses in case a driver without any valid car insurance policy crashes into you.

Typically, an uninsured motorist insurance policy is a good coverage to be obtained. The coverage usually matches your liability auto insurance when you get it. For example, you should get an uninsured motorist insurance coverage for the sum of INR 100,000 if your responsibility limitations are for injuries to one person and INR 300,000 if injuries occur in a single collision.

Final Words

A good way to determine how much car insurance policy you’d need is to start with a liability car insurance plan. It is advised that you get liability auto insurance that fully covers any losses you could incur from a lawsuit. Purchasing liability insurance in quantities large enough to safeguard your home, possessions, and money is wise.

If uninsured motorist coverage is available, it is always wise to buy it. It will certainly cover your medical bills and other relevant expenses, like lost wages, pain, and suffering, in a situation wherein a driver without insurance crashes into you.