8 Common Car Insurance Myth Debunked

Car insurance, although a very crucial aspect of car purchase, is sometimes pushed aside owing to the several myths associated with it. However, if you do a complete research on car insurance policies online and look at the right places, you will be quite convinced to take one as soon as you decide on buying a car of your dreams.

Myths Associated with Buying Car Insurance:

Given below are some of the myths related to car insurance policies in India:

  • If a car is old, there is no need for car insurance – Apart from new car owners, old car owners are also living with a myth that if their car is old, chances of it getting stolen is mighty low. However, that is not so true. Older cars are easier to steal as new cars come fitted with alarm devices and other safety gadgets. Therefore, it is advisable that whether an old car or new, it does not imply that it is safe based on its age.
  • Age of the driver is a deciding factor – Although it may be one of the factors that contribute to a car insurance policy, it is not blindly based on the driver’s age. It is more important that the driver has a clean driving history. It is still a new feature in India. HDFC Ergo car insurance is the only policy that offers discounts based on age of the applicant.
  • The colour of the car is very crucial – This is a complete myth as the colour of the car only matters to you and is just a matter of choice. Although car companies charge premium rates for specific colours, it does not matter to insurance companies. More than the colour, it is the make of the car, engine of the car, style, type of fuel used, etc. are important factors while offering a .
  • My dealer will cover my insurance – Another great myth fooling car buyers since a very long time. Car dealers offer car insurance along with the car when you make a purchase deal with them. It is important to know whether the dealer has provided a third-party liability or comprehensive insurance. Third-party liability cover would only mean that the losses incurred to a third-party because of an accident caused by your car, is covered. Therefore, it is important to look at more insurance options that cover you and your car personally. It is always advised to take up a comprehensive cover where riders such as personal accidental cover, zero depreciation cover, etc. can be chosen.
  • If a car is lent, then the owner does not hold a responsibility in an accident – As long as an individual owns a car, he or she is responsible for it. Even if it is the car owner’s driver, the owner is solely held responsible for the damages caused by an accident.
  • Sports car owners have to pay more insurance – This is not completely true. Insurance amount is decided by the value of the car and its engine. The only reason that some sports cars require very high insurance is only because of their powerful engines and high price tag.
  • If a comprehensive policy is taken, the car owner is completely covered – Although it is called a comprehensive cover, there are still some areas that required to be covered. Add-ons such as consumable cover, zero depreciation, loss of personal belongings, personal accident cover, etc. ensure a more complete safety in an accident.
  • What if an insurance company cancels policy – An insurance company does not hold any right to randomly cancel your car insurance policy, unless it is a case of non-payment of premiums or fraud. However, the company will surely intimate the customer before they do so.

It may take some time to clear these myths for first-time car buyers, however once there is proper research involved, they can be debunked comfortably. To add to that, there are many online platforms that offer comparison of various car insurance policies, making it clearer for a car buyer.

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

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