Types of car insurance policies
An important aspect for every car owner is car insurance. In India, it is mandated by law for every car owner to have a valid insurance policy that can protect any individual that might meet with an accident on the road. In addition, there are several other types of policies which can help insure your car against different aspects, but may cause your premium to go up. For a beginner, these insurance policies can be quite confusing. Here we bring you the various types of car insurance policies available in India, for you to better decide which kind you would like to apply for.
Liability or third party insurance
This type of insurance is a legal requirement in an attempt to protect any person that you may injure on the road. In case you collide with another car or damage public property wherein you are determined to be at fault, liability insurance will provide the money to repair the other person’s property (from car damage, windshield repairs, property damage) or even reimburse the medical bills as covered in the contract. Basically, this insurance coverage looks out for any third person on the road and protects them in an accident which may be caused by you.
Now while liability insurance is mandatory, it only covers the cost of repairs for the other person’s vehicle but provides nothing for your own. With collision insurance, however, the insurance company will fund the necessary repairs required for your car (such as windshield repair, car body damage etc.). Sometimes, for people, after purchasing a car, even the cost of something minor like a windshield replacement seems tedious. This insurance policy, while not a legal requirement, is advisable to have on a new car as it can help finance the repairs while contributing towards a new car if this one is completely damaged. In addition, certain high-end cars may have latest fittings and parts which can be quite costly to replace, even in such a case, collision insurance works great.
This form of insurance may cause your premiums to go up a bit, but is a good investment in the long run. Unlike previously mentioned insurance policies that only protect your car against collision, this type of insurance reimburses you for damage to your car from different sources. These even include natural calamities like fire, earthquakes, cyclones, to damage caused by animals and theft.
No fault liability
This type of insurance cover helps protect the insured for medical injuries and property damage, regardless of where the fault lies. However, this type of insurance coverage can add quite a hefty amount to your payment schedule and isn’t recommended if your car isn’t that difficult or expensive to replace.
Personal injury cover
This insurance cover looks out for the medical bills sustained by the driver and passengers in case of an accident. Here irrespective of where the fault lies, the insurance company will fund the medical bills which can be quite huge in a major collision. However, for those individuals with a good health insurance plan, this insurance cover may not be required.
Uninsured motorist protection
Often it happens, that even though liability or third party insurance is a legal mandate for all car owners, some are not insured. In case of an accident with such circumstances, the person injured may not receive the funds that legally should be made available. Additionally, some of the lower cost policies may not cover several aspects of the damage, leaving the individual with a huge number of bills for no fault of his. Now, even though legally, the party which is held responsible is liable to pay for all damage caused in the accident, some may not have the required funds to do so. This insurance policy can help cover the funds in such an event.
Guaranteed auto protection (GAP)
This insurance cover is helpful for those car owners that have not yet completed their car payments. In case of an accident before the payment of the car is complete, GAP insurance will help cover the value of the car. This type of insurance cover is a good investment in the initial stages when the pay-out value is still quite high.
Hence, we can see that there are a number of car insurance policies designed to protect you and others on the road. Based on your budget and requirements you can opt for the policies that seem most important to you. Keep in mind that all insurance policies need to be reviewed annually to stay valid.
Content Source: Windshield Experts
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