Getting insurance for your car? Know about motor insurance and it's basics
It is very important to know about car insurance before you buy a vehicle. However, just as you need to check a few things about the car that you are about to purchase, there are also certain things that you need to keep in mind before you buy motor insurance.
It is very important to know about car insurance before you buy a vehicle. However, just as you need to check a few things about the car that you are about to purchase, there are also certain things that you need to keep in mind before you buy motor insurance. Zee Business spoke to Deepak Yohannan, CEO of My Insurance Club who cleared doubts about motor insurance for car buyers. Some of the important aspects discussed by Yohanan are:
He said that there certain things that should be a priority in the buyers mind -
a. Where can you buy an insurance policy?
b. What should be the insurance premium?
c. Be alert if you are buying car insurance through an agent
d. Insurance cover is decided on which value?
Types of Motor insurance
A motor insurance can be divided into two parts. One is third party insurance and the second one is own damage insurance. Out of these two, the third party insurance is compulsory. Legally, one has to take this as otherwise the car owner can't take the vehicle out on the road. The premium of this is decided by the government every year. When you get insurance, the value of your car is decided by something called Insured Declared Value (IDV).
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The third party insurance covers the damage caused by the car while on the road. Own damage insurance covers the damages made to your car during an accident or if your car is stolen.
Watch video of the interaction below:
No claim bonus
This is a type of reward that the insurance company gives you. For say, if you do not claim any insurance for a period of one year then the company gives you some discount in your premium amount. If you do not claim for any amount in 5 years then you can get a reduction of up to 50% in your premium amount.
It is always advisable to compare the premiums. The premium of the third party insurance is decided by the government. But the Own damage insurance premium is decided by the insurance companies.