Types of Car insurance in India

Insurance can be one of the tricky components to consider while purchasing a new car. As per the Indian Motor Act, having car insurance is mandatory in India. It is pertinent to note that only third-party car insurance is mandatory. Let's now understand the types of car insurance in India.

Third-party Liability Only Coverage

The third-party car insurance covers the cost of repairs/replacements of damaged vehicles of third parties, cost of treatment of third parties and the liabilities arising out of their death. Choosing the right amount of sum assured according to the factors involved is vital to avoid out-of-pocket payments to third parties.

Personal Injury/Accident Coverage

Personal injury coverage shall cover all the costs associated with the treatment of the owner-driver of the vehicle. There are insurance policies available to protect the passengers, too. One can select an appropriate coverage to make the most of the investment.

Comprehensive Car Insurance

Comprehensive coverage is the most extensive policy type, as it gives the highest level of protection. It generally includes third-party liabilities, personal accident/injury coverage, damage to one's own vehicle, and non-collision damages.

Uninsured Motorist Protection

This type of insurance provides coverage at times when the at-fault driver does not have insurance to cover your costs. You will not have to pay out of your pocket to cover the medical bills or any other repair/replacement cost if you have this coverage while the at-fault driver does not have insurance.

Collision Coverage

This type of coverage provides for the cost of repairs to one's own vehicle that has been damaged. It is important to have this coverage if the vehicle is purchased on loan.

Apart from the coverages mentioned above, one can opt for the following add-ons to derive the best benefit from investing in car insurance.

1. Zero Depreciation Cover:- With this cover, one can claim the complete sum assured without deduction for the depreciation of parts.

2. Roadside Assistance Cover:- One gets round-the-clock breakdown assistance for towing or immediate mechanic services.

3. No Claim Bonus Protection:- With this add-on, you can file for a predetermined number of claims while maintaining the no claim bonus discount at the time of renewals.

4. Key Replacement Cover:- With this add-on, one can get their keys replaced if their stolen car is recovered or if the keys are lost.

5. Engine Replacement Cover:- If one opts for this add-on, they can get their car's engine replaced without incurring additional costs. This comes in handy, especially if one lives in an area that is prone to waterlogging or floods.

6. Tyre Protection Cover:- This add-on ensures that the cost of repairing/replacing a damaged tyre/tube is reimbursed.