Car insurance is a type of vehicle insurance that is a contract between car owner and an insurance company where the insurer provides a safety net for your four-wheeler in exchange for a periodic payment.
If you are wondering who should buy car insurance, the answer is that it is mandatory for all car owners in India to buy a (third-party) car policy; otherwise, it can lead to hefty fines as well as legal consequences. Buying insurance for car is a great choice because it:
· Is mandatory requirement by Law
· Compensates for third-party damages
· Protects your vehicle from damages
· Covers legal costs
· Provides financial support
· Provides peace of mind
The three types of car insurance in India are third-party, standalone own-damage, and comprehensive car insurance. You can opt for any of these plans that fit your coverage requirements and budget.
Third-party car insurance or liability-only insurance is a mandatory policy for all car owners in India. Third-party insurance protects you from financial losses and legal liabilities arising from damage caused to 3rd-party property or injury/death of a 3rd-party person by your insured four-wheeler.
Third-party insurance offers coverage of up to Rs 7.5 lakh for property damages and unlimited compensation for third-party injury/death.
Comprehensive car insurance is a type of motor insurance which covers both third-party liabilities and own damages to the insured vehicle. With a comprehensive car policy, you can secure yourself against damages from theft, fire, vandalism, and natural calamities.
Additionally, you can enhance your coverage with add-ons like roadside assistance and zero depreciation at a small extra premium.
A standalone own-damage policy compensates for the damages caused to your four-wheeler due to accidents and other losses, including theft and fire. It does not cover damages caused to a third-party property or person.
This car policy can be paired with an active third-party policy. Hence, a standalone policy is usually bought for car age up to three years.
