How well do you know these motor insurance terms
Buying motor insurance can be difficult if you are not aware of what you are being offered, what you want, and what you should get in your motor insurance policy. Don’t worry, it does not take a lot to figure that out. As long as you know the motor insurance jargon, you will be able to make a fair choice in buying yourself the best insurance plan.
There are many motor insurance terms that are included in your plans. As you start comparing your options, you will keep discovering more and more. But what’s important is that you must have all your basics covered so that when you are buying your motor insurance, you are not clueless about what is being put forth by the insurer. Here are a few motor insurance terms that you must know before you start looking for a motor insurance policy.
Comprehensive motor insurance policy
Comprehensive motor insurance is a well-rounded plan that includes third-party liability and own damage coverage. It provides compensation in case your car faces damage because of accidents, ignition, total damage, theft, natural calamities, etc. This policy is not mandatory under law, but it certainly is the one that offers the most benefits to the policyholder. You can buy this type of policy for your personal as well as commercial vehicles.
No Bonus Claim
Let’s say you have owned your motor insurance policy for a year and throughout that year you did not file any claims because your car never faced any damage or because there were very minor expenses that you handled on your end. When you renew your policy for next year, you will receive the benefit of a No Bonus Claim for that claim-free year. You will either receive a discount on your premium or your coverage amount will be increased. However, there is a limit to this bonus, and you must check for the same with your insurer.
Insured Declared Value
Your insurance company will compensate you for the loss of your car due to theft or if it is completely destroyed in an accident. Your insurer will offer a maximum claim amount for the same. This amount is known as the IDV, which is decided at the time of buying motor insurance. This depends on the value of your car at the time of buying the car insurance.
Cashless claim settlement
In cashless claim settlement, when you file a claim, you do not have to make any upfront payments to repair your vehicle. However, this is not inclusive of some mandatory payments like deductibles. If you opt for cashless claim settlement, you also get access to a network of garages that your insurer has a tie-up with.
Add-on Coverages
A basic comprehensive car insurance policy offers you a decent amount of protection. But if you want to widen your coverage, you can opt for add-on benefits or riders offered by the insurance companies. These are additional covers that focus on providing niche protection for your car in very specific instances. This can be available at an extra premium rate.
Here are some of the coverages that you must know about.
Personal Accident Cover
Personal accident cover comes bundled with your basic car insurance plan. This cover offers protection to you as the diver or policyholder in case you face injuries or even severe circumstances that may result in death or permanent disability. This cover offers you a maximum compensation of Rs. 15 lakhs under different circumstances. In case of death, your nominee will receive 100% compensation from your insurer.
Roadside Assistance Cover
Roadside assistance cover provides you with on-road help which is inclusive of fixing minor repairs, flat tyres, breakdown support over the phone, towing, etc. If you require any such assistance, you must inform your insurer or the garage in their network, and the nearest help will arrive at you.
Zero Depreciation Cover
Zero depreciation cover, also known as nil depreciation or bumper to bumper cover, ensures that depreciation is included in your compensation amount. However, this cover is only valid for cars that are as old as 5 years. This cover is not available for older cars.
You can learn more about different terms if you choose to buy motor insurance online. Purchasing car insurance online allows you to explore at your leisure, and by the time you finalize a deal, you will be well versed in the majority of motor insurance terms.
Disclaimer: The content provided is for education and informational purpose only, none of the information contained in our blog amounts to any form of opinion or advice. Please go through policy related documents carefully or consult an expert before making any insurance-related decisions.