A Quick Guide On Buying Insurance Policy For A Used Car
Owning a car in India is considered a big deal. It becomes part of your pride, and you do everything to protect it from natural and man-made elements. As per the Motor Vehicles Act, 1988, a person can legally drive a car in India only after getting third-party liability insurance. Though the law does not mandate you to buy a comprehensive insurance policy but to save yourself from the expenses that come with an accident or theft, you must get one. It protects you from third-party liability as well as financial loss occurred because of damage or theft of your vehicle.
About used car’s insurance policy
Buying a second-hand car is common in India. People often opt for a second-hand car to save some money. Getting your hands on a second-hand car that is in good condition is something like winning a lottery, and you would not want it to get damaged in any case. However, it is next to impossible to be sure that nothing will happen to your vehicle. This is why you should know about some factors that you should consider while buying an insurance policy for a used car. Please keep in mind that when you are buying an insurance policy for a used car, the policy that was applicable before it was transferred to you may not apply. Here is a quick guide on buying insurance policy for a used car.
Third-party Cover
The first thing you need to confirm that the insurance policy you are opting should have the third-party liability covered in it. Also, please keep in mind that only Third-Party Liability cover will not be enough for you, and you should opt for a comprehensive plan. Buying a car insurance policy can be overwhelming, especially when you are shopping for your newly-bought second-hand car. Thus, checking every possible aspect of the policy is important.
Compare the options available
Before you finalize the plan you think fits in your criteria, please make sure to compare plans from different insurance companies. Check what type of coverage they are offering and make sure you understand their claim process. It will be better if the company offers a cashless claim facility with authorized service centers across the country. Check the claim approval record of the insurer as well as it will give you an idea of how easy or difficult it is going to be in case you want to file a claim.
Do not forget the add-ons
Add-ons are extremely important, especially when you are buying insurance cover for a second-hand car. By paying an additional amount, you can include a number of benefits in the insurance policy. Some of the important add-ons to opt for are:
- Zero depreciation cover: With this add-on, you will get cover on the original price of various parts while settling a claim. If you do not opt for this add-on, the market value of the said part will be applicable, and the remaining amount will go from your pocket.
- Engine protection: Interestingly, the engine is not covered under a basic car insurance plan. You have to buy this add-on to make sure you get cover for the damage to the engine.
- Roadside assistance: This add-on comes in handy if you get stuck in the middle of the road because of a breakdown. The insurance company will provide on-the-spot assistance to tackle the situation.
- Choose additional deductibles
If you can pay for some repairs on your own, do not forget to choose additional deductibles. It will help you in reducing the premium cost. There are two types of deductibles that are compulsory and voluntary. A compulsory deductible is a pre-defined amount mentioned in the contract, and a voluntary deductible is an amount you agree to share with the insurance company.
Understand the importance of Insured Declared Value or IDV
Please make sure you know the IDV of your car offered by the insurance company. It is based on the market value of the car, and you can only claim for the amount based on IDV in case of an accident or theft. If you are choosing a policy that is available at a lower premium, there is a possibility that the IDV is also low. In such cases, you will end up paying for the damage from your pocket.
To conclude
Shopping for an insurance policy for a used car is as important and overwhelming as for a new car. It is important to keep a few basic points in mind to make sure you choose the best policy with maximum benefits at an affordable price.
