In India, as per the Motor Vehicles Act, all car owners must compulsorily have at least a third-party liability insurance. However, it is better to purchase a comprehensive policy, as it allows you to get protection against the financial expenses arising from an accident. It covers both third-party liabilities and damages to your car.
Accidents may happen inspite of you being an experienced driver. Such incidents are not only stressful but also bring in unanticipated financial loss. In case of absence of own damage insurance you will have to pay for all the damages of your own car while the third party insurance would cover damages to third party. Being involved in a car accident could also mean that the insurance provider will increase the premium when your policy is up for renewal. So, if you are contemplating switching to a different insurance after an accident? This write-up is just for you.
When can you switch your car insurance?
Technically, you can switch your car insurance policy anytime you want; you need not wait till the renewal date. However, if you change your policy before renewal, the new insurance company may charge a penalty. Hence, it is better to wait till the renewal date before you switch your car insurance policy unless you are buying a new car, adding a new driver or moving to a new location.
Is it a good idea to switch your car insurance after an accident?
You can switch your car insurance after an accident. However, experts recommend it may not be a good idea. When you get involved in an accident, and irrespective of whether you are guilty of causing the accident or not, the insurance company will increase the premium when you renew it. This is because the insurance company will consider you a high-risk customer.
Because of this, you may believe switching the insurance company is a quick solution to avoid paying the high premium. However, that’s not the case. In fact, when you switch your personal car accident insurance policy immediately after the accident, you may have to pay the high premium with immediate effect.
So, let us assume if you get involved in an accident and your renewal is still six months away, then it is better to stick with the same plan rather than switching to a different insurer. This is because until the policy is due for renewal, i.e., for the next six months you have to still pay the pre-accident premium rate.
Important things to consider before switching your car insurance policy after an accident
Like any insurance policy, when you buy or renew your car insurance, you must choose a plan that offers high coverage. It is better to choose a comprehensive car insurance plan that covers own damages and third-party liabilities.
Compare the different plans from different insurance companies online and choose a policy with high cost-to-benefit ratio. It is also advisable to do a background check of the insurer’s credibility and reputation by reading the customer reviews and testimonials on different online platforms.
Another critical factor to consider is the insurer’s claim settlement ratio (CSR). It is essentially the percentage of claims the insurance company has successfully settled in a year. You must choose an insurance company that has a high CSR of 85% or more so that your claim is settled faster and without any hassles. You can easily find the CSR ratio of all insurance companies on the IRDA (Insurance Regulatory and Development Authority) website.
All motor insurance companies have a network of garages to facilitate cashless claims. So, when you buy or renew your policy, make sure to check the number of network garages the insurer has and if the garages are located nearby.
In most cases, switching your car insurance is an excellent solution to reduce your premium. You can switch your insurance to Kotak General Insurance, and buy the Kotak Car Secure policy, a comprehensive car insurance that offers a wide range of benefits at an affordable premium.
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.