Why Should You Always Compare Car Insurance Policy Before Buying It?


Before investing in a car insurance policy, it is very important to be aware of the market trends and the insurance policies offered by different insurance providers. One must have knowledge about the basics of such policies and must be careful regarding their needs. The first and foremost step is comparing various plans offered by different companies in the industry. Here are some of the advantages of comparing car insurance policy.

Benefits of comparing insurance policies

  • Helps in finding the most suitable policy

When you start comparing car insurance policies, you find them for better prices and optimum coverage. On the contrary, if you do not research in advance and go for any plan, you may have to face huge costs and minimal coverage. To avoid such issues, it is important to compare insurance policies to be aware of the coverage.

  • Cuts extra costs

With the help of policy comparison, one can avoid incurring extra and unnecessary costs. It helps to minimise any additional cost and achieve optimum results.

  • Enables better understanding

When you compare car insurance policy, it will help you differentiate policies on several factors. It increases your knowledge regarding various major points and informs you about the market trends.

Types of car insurance policies to look for

Companies offering car insurance usually deal in 2 categories:

  • Third party liability

This plan is made keeping in mind the damage caused to the third party. This plan provides coverage to damage caused to any property of third party, injuries to the others and accidental death. In India, this plan is mandatory by the IRDAI (Insurance Regulatory and Development Authority of India) for all the vehicles using public roads.

  • Comprehensive Insurance

This plan is chosen by those who keep their own safety a priority along with the safety of others. It covers both the damage to self and the liabilities of the third party.  In addition to this, it also covers the theft or destruction caused due to uncertain and unnatural problems like fire, cyclone, earthquake etc.

Points to be avoided while selecting a policy

  • Policy Lapse

When a policy lapses, the insurance company generally offers a grace period of one week. After this period, the policy will not stand legal and you and your vehicle may be at risk without an insurance. Once the policy expires, you will also lose NCB (No Claim Bonus) offered previously on your car insurance.

  • Decreasing car value

Sometimes, in order to pay a low premium, people tend to reduce the insured declared value or IDV of the car. In case of an accident, a car is then treated as total write off. Avoid such mistakes. Always choose a policy which provides you maximum insured declared value possible.

To sign off

Factors that might affect the car insurance premium can be the risks related to car, location, driver and its past. One can also reduce the unnecessary costs with no claim bonus, discounts and deductibles offered by the company itself. Thus, it is advisable to compare car insurance policy first and then choose the plan for the best deal possible!

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