How to choose the right car insurance policy in India

Insurance companies in India offer a plethora of car insurance plans that cater to the specific needs of the buyers, but choosing the right policy can be challenging. In India, insurance companies offer different plans with different features, and these plans come at various price points. So, it is important that you do your research well before picking the right insurance policy to best suit your needs. Here are a few tips that should help you:

Know your needs

Before you start looking for the best car insurance and the best insurance company, assess your needs and know the type of policy you want. In India, there are two types of car insurance policies – Third-party Insurance and Comprehensive Insurance.

Third-party insurance is a mandatory requirement by law. It covers only damages to the third-party. Under third-party insurance, you do not get compensation for the damages to your car.

A comprehensive car insurance policy, on the other hand, covers both third-party liability and damage to your car.

So, if you are looking for a basic plan with an affordable premium, a third-party liability plan would be an ideal choice. But, if you drive a luxury car, it is better to purchase a comprehensive cover, as it will help reduce financial liabilities in the event of an accident.

Compare the plans

Once you are sure about the type of car insurance policy you need, it is a good practice to compare the plans from different insurance companies before making the purchase decision. You must compare the plans in terms of the sum insured, inclusions and exclusion of the policy, type of add-ons offered, claim process, deductibles, etc. Choose a plan that is cost-effective for the premium you pay.

Ask about the add-ons

Add-ons or Riders are additional coverage options that you can purchase by paying an additional premium. The riders widen the scope of the policy and provide coverage against specific damages that are not included in your usual plan. You must ask the insurer about the add-ons offered and choose the one that best suits your needs. However, you must know that add-ons are available only to comprehensive insurance policyholders.

Check the claim process

One of the primary objectives of purchasing a car insurance policy is to get immediate financial assistance in the event of an accident. So, it is paramount that you choose an insurance that has an easy and quick claim process. The last thing you would want during an emergency is going through a complicated procedure to get compensation for the losses.

Know about the claim settlement ratio of the insurer

Not many car insurance buyers understand the importance of claim settlement ratio (CSR). You must check the claim settlement ratio before finalising the insurer. The CSR indicates the number of claims the insurer has successfully settled against the number of claim applications they received in one year. It is better to purchase a policy from a company that has high CSR, as it would mean that you have better chances of getting your claim approved.

Never provide any wrong information

A lot of first-time car insurance buyers tend to provide incorrect information about their age and driving history to reduce the premium amount. But such practices can prove to be a costly mistake at the time of filing a claim. If the insurer finds the information is misleading, your insurance will be cancelled. So, it advisable to be honest and provide accurate details in the application form.

Be aware of the policy terms and conditions

Last but not the least, before you sign the policy documents, you must take your time to read the terms and conditions carefully and check if the terms are favourable and meet your needs. This is a critical step to avoid any legal hassles at the time filing a claim.

Final word

Buying a car insurance policy is not as hard as it may seem. Following the tips mentioned above can immensely help you choose the right plan.