What is Comprehensive Car Insurance in India?
If you are concerned about your car and the financial losses in case if your car is damaged or stolen, it is time to know what comprehensive car insurance is.
In India, car insurance is broadly divided into two categories.
- Third party Car Insurance
- Comprehensive Car Insurance
With third-party insurance, you are only protected against the damages, losses, or injuries caused to the third party in case of a road accident involving your car. As per the Motor Vehicles Act, third-party insurance is mandatory for every car.
But what if the accident damaged your car and caused injuries to you as well? Unfortunately, with third-party insurance, you are required to pay for your injuries and car damages from your pocket. This is where a comprehensive policy can help.
What Is Comprehensive Car Insurance?
As the name suggests, a comprehensive insurance policy offers complete protection to both the parties involved in an accident. So, the damages to self, car, as well as the other party involved in the accident are covered by the comprehensive policy, up to the maximum coverage amount.
Apart from damages and injuries, a comprehensive policy also offers added protection in cases like-
- Natural disasters
- Fire
- Falling objects
- Vandalism
- Theft
- Civil Disturbances
What are Add-Ons in Comprehensive Car Insurance?
Another advantage of comprehensive insurance coverage is that you get to purchase several add-ons with the policy. The add-ons help you increase the scope of your policy. For instance, one add-on that a lot of people consider along with their comprehensive policy is 24x7 roadside assistance.
With this add-on, you can receive 24x7 assistance in case if your car breaks down even in the middle of nowhere. From arranging a mechanic, towing, alternative vehicle, fuel delivery, to a hotel stay, your insurer will try to help you in many different ways if you have this add-on.
Some other very popular add-ons you can consider are-
- Zero Depreciation
- Key Protection
- Engine Protector
- Return to Invoice
- NCB Protection
What is NCB in Comprehensive Insurance?
There is a widespread belief in India that comprehensive plans are expensive as compared to third-party plans. While this is not entirely false, the higher premiums of a comprehensive policy also offer significantly higher coverage. Own damages, injuries, or car theft could result in severe financial losses.
Paying higher premiums for a comprehensive plan makes sense as it could protect you against such losses. Moreover, there is also a smart way to reduce the premiums of your comprehensive policy. With No Claim Bonus or NCB, you can get discounts of up to 50% on the policy premiums.
Think of NCB as an incentive you receive from your insurer for not filing any claims. The NCB starts at 20% for the first claim-free year and reaches up to 50% in the fifth claim-free year.
Here is how the NCB works-
No. of Claim-Free Years |
NCB Percentage |
|---|---|
1 |
20% |
2 |
25% |
3 |
35% |
4 |
45% |
5 |
50% |
So, let’s say that you want to renew your comprehensive policy that you purchased last year as it is about to expire soon. If you did not file any claims last year, you have 1 claim-free year. So, you are entitled to receive NCB or premium discount of 20%. The NCB percentage will continue increasing up to the 5th claim-free year as per the table above.
But note that you will lose your accumulated NCB if you file any claims. So, even if you have 3 claim-free years and current NCB is 35%, you will have to again start at 0% NCB if you file any claims now. Also, the maximum NCB discount in comprehensive vehicle insurance is 50%.
Are There Any Exclusions in Comprehensive Car Insurance?
Just like all the different types of insurance policies, comprehensive insurance plans have exclusions too. Some of the most important ones are-
- Depreciation
- Wear and tear due to ageing
- Mechanical and electrical breakdown
- Damage caused to the car when the driver was driving without a valid driving license
- Damage caused to the car when the driver was driving under the influence of alcohol or other intoxicants
- Damage or loss of the car due to war or nuclear risk
- Damage or loss occurred outside the geographical scope of the policy
Get Added Protection with a Comprehensive Car Insurance Plan
It is not difficult to understand the different ways in which comprehensive car insurance in India could help you and your finances. With additional benefits such as add-ons and NCB, you can get yourself a feature-packed car insurance plan that could keep you and your prized possession protected against many unfortunate events.
Moreover, with many top insurers offering car insurance online, purchasing and renewing a comprehensive policy is a simple and hassle-free process. Compare comprehensive plans from reputed insurers online and select one that best suits your requirements.