Some would say it is much easier to decode the feelings of love than the terms included in a car insurance policy. While we don’t claim to be experts at matters of the heart, we can help you tell the difference between NCB and IDV. Navigating the world of car insurance buying could be tedious due to the numerous choices available in the market. However, this, coupled with complicated motor insurance terms, can add to the task. The least of your concerns while buying a car insurance policy should be decoding motor insurance jargons and instead, finding the best coverage at an affordable cost. Here’s a list of demystified car insurance terms that will come in handy when you look for the best car insurance in India.
Insured Declared Value, is the current market price of your car to your car insurance company. It is also one of the most important factors of calculating your car insurance premium
The no claim bonus (NCB) helps you get discounts on car insurance renewal if no claims are made over one or more years. It can be transferred to another car insurance provider as well.
If you get lower than expected claimed amount from your car insurance provider, consider that depreciation had a role to play in this. The zero depreciation cover relieves you from bearing depreciation up to 50 per cent on various parts and paints in the event of any damage to your vehicle due to an accident.
The deductible is an amount determined by you or the car insurance company to pay towards the repair of your vehicle, which is exclusive of the amount paid by your motor insurance provider. For instance, if your deductible is INR10000, and our repair cost comes to INR25000, you will bear INR10000, and the rest of the amount will be covered by your car insurance company. There are two kinds of deductibles: compulsory deductibles and voluntary deductibles.
Basic car insurance policies cover damage to vehicles and bodily injuries, however with motor insurance add-on covers or riders, you can get added protection for yourself and your vehicles. For example, a roadside assistance add-on cover provides you towing services among other things in case your car breaks down, even if it’s not an accidental damage. This may have not been covered by your basic car insurance policy otherwise.
The personal accident motor insurance cover protects you against permanent total disablement and accidental death in the event of an accident in your insured vehicle. Apart from individual accident cover, there is also enhanced accident motor insurance cover or group accident cover which protects the other passengers in the car.
This provides protection to you from any legal obligation arising from the death, disability, bodily injury to the third-party and damage to their property due to use of your vehicle.
In addition to third party cover, this provides protection for your vehicle against loss or damages from theft, accident and other incidents. This is considered to be the highest form of coverage in motor insurance.
Endorsement is referred to as any change made to your current car insurance policy. These changes may be changes in vehicle particulars, your communication address or other details. These may be financial or non-financial in nature depending on your request for change.
Exclusions are those risks that are not covered by your car insurance policy. A few examples are normal wear and tear, drinking and driving, driving without a valid driving licence. If you are driving your personal vehicle for commercial purposes, your car insurance policy will not apply as there are different policies for both the categories.
Car insurance claims includes requests for reimbursements made to your car insurance provider pertaining to bodily injuries, permanent disability, and death, and damages to vehicles of the policyholder and the third party depending on the car insurance coverage. On the other hand, premiums are amount paid to the motor insurance provider by the policyholder based on the various risks covered.
The first step towards buying the most suitable car insurance policy is understanding the various terms related to it. This list will help you do that.
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