9 Surprising Things Covered By Auto Insurance

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When you think about surprises surrounding your car’s insurance policy, you may imagine mishandled insurance claims or unfair premium rates. However, you should understand that car insurance can present you with sweet surprises as well! Since there are so many features offered by car insurance companies under their plans, it is quite probable that you never knew some of these exciting ones existed!

Here, we have listed these factors in a reverse order so that it piques your curiosity like a countdown would do:

9. Coverage for in-transit damages - It is understood that a comprehensive car insurance plan offers you insurance protection against accidents, theft, and vandalism. You should know that such a plan also protects the vehicle from natural calamities like lightning, floods, hurricanes and the like. Another surprising offering under car insurance is the protection from damages while the vehicle was being transported from one place to another.

8. 24/7 Roadside Assistance cover - Some car insurance companies offer Roadside Assistance cover as part of the comprehensive car insurance policy. Others provide this as an add-on that can be bought separately and added to the policy coverage. This is a very useful cover that assists the car owner in the difficult time of a car breakdown. This also helps you if you are stranded in a lonely place with a punctured tyre. You just have to make a phone call to the insurance company and report the issue. The insurer will inform the nearest network garage from where a mechanic will be sent to assist you.

7. Personal accident cover for passengers - The comprehensive car insurance plan protects the car owner from accidental injuries or death. However, this coverage is not extended to the passengers. Most insurance providers offer an add-on cover that protects the passengers from accidental injuries or death. This can be taken if you have a family and would like to avail complete protection.

6. Online car insurance purchase - Although quite uncommon earlier, the practise of offering insurance plans for online purchase has gained momentum. Several leading insurance companies in India offer this facility today. Buying insurance online promises a hassle-free experience with limited paperwork. You also stand to gain through discounted rates on premium. Online policies are easy to maintain and can be renewed easily as well.

5. Nil depreciation cover - Also referred to as zero depreciation add-on insurance, this cover enables the car owner to receive the complete cost of car parts that are replaced after an accident. This implies that the depreciation on car parts will not be considered while the insurer pays the claim amount. This is a significant benefit, as cost of depreciation can constitute a substantial part of the payout. Hence, the zero depreciation cover is a very popular rider in car insurance.

4. Engine protect cover - Coverage for a car’s engine is not provided by a comprehensive motor insurance policy. This can be a disadvantage to people living in areas prone to waterlogging. Car insurance companies today offer the engine protect cover to overcome this issue. By opting to add this coverage to your comprehensive car insurance plan, you will receive compensation for damages to the car’s engine.

3. Garage cash benefit - Garage cash cover is a car insurance add-on plan that can enhance the coverage provided by the base policy. When your car is at a service centre for repair work, you may find it difficult to commute. In such cases, you may have to hire a taxi or use public transport. The garage cash cover enables you to get conveyance expense of Rs.500 while your vehicle is undergoing repairs. The add-on insurance provides you an allowance each day until your vehicle is repaired and handed back to you. There will, however, be an upper limit on the number of days you can receive this allowance. There are also limits on the number of claims that will be honoured under this rider.

2. Transfer No Claim Bonus (NCB) - When you sell your vehicle to another person, it is possible to retain the NCB you earned on its insurance policy. You will have to contact your car insurance provider and request for an NCB retention letter that equips you with the ability to hold on to your hard-earned NCB for up to 2 years. Within this time you will have to link it to another car insurance policy in your name. This could be the insurance of another car you own. This is a very attractive feature as you will not lose the benefit that you earned for being a careful and diligent driver.

1. Commercial car insurance - Personal versus commercial car insurance is a major grey area for many car owners. If you have a vehicle that you use only for personal purposes, you can buy a personal car insurance package for the car. Vehicles used for commercial purposes will have to be insured with a different type of policy, i.e., the commercial car insurance, that is priced higher. However, the coverage offered by this plan will be best suited for a commercial vehicle. You cannot run a commercial vehicle when it is insured with only a personal car insurance plan. This is punishable by law.

Final Word

As a car owner, you should be well aware of the coverage under your motor insurance policy, so that there are no surprises at the time of a claim. You should read through the policy documentation carefully and pay close attention to the exclusions so that you do not misunderstand those clauses.

GST Update: GST of 18% is applicable on car insurance effective from the 1st of July, 2017