Have You Made These Mistakes While Buying Car Insurance Policy

Nowadays, when the process to buy/renew car insurance is much easier and faster, people tend to forget to do detailed research online before buying any policy. All they want is an instant experience which leads to mistakes that can cost a fortune. Here are some common mistakes that should be avoided to make the most of your car insurance policy. 

  • Avoiding Research

While shopping online for a particular dress or gadget, we check which brands offer a good discount or what are their other options at the same price. So why do we forget to compare or research when it comes to insurance? We know it’s not that exciting compared to shopping for other things, but at the end of the day, it’s your hard-earned money which you will save here or there.

So always compare the offers, know about the brand, read reviews and know how many claims have been settled without any disputes, etc, before buying the car insurance policy.

Note:- Go to the Insurance Regulatory and Development Authority of India (IRDAI) and check the registration number and CIN number of a particular insurer or company to know if they are authorised. You can also check comments on social media accounts to know about their authenticity.

  • Choosing Minimum Coverage

Most people choose minimum coverage as one way to lower car insurance premiums. The purpose of insurance is to cover your whole expense in case of unfortunate events. Doesn’t it make sense to have a Bumper to Bumper Insurance, a comprehensive policy that includes third-party liability insurance and covers your car damages for a little more premium?

  • Offline Mode

Do you know buying a car insurance online policy is cheaper than offline? There are still most of the people who contact their agent and take the policy offline. Online is simple with no paperwork and quite faster, plus it helps you save a little extra.

  • Not Installing Anti-theft Devices

Most people buy a high-value car but forget about the safety measures like installing an anti-theft device in the car. Installing ATDs certified by the Automotive Research Association of India (ARAI) can get you a discount on the premium.

  • Avoiding Add-ons

People generally avoid add-ons in order to save money on premium but the add-ons provide enhanced coverage and services. Analyse your daily travel needs and buy add-ons that can be useful. For example, cashless car insurance roadside assistance or zero depreciation add-on is a must.

  • Incorrect Insured Declared Value (IDV)

IDV is the important element in calculating the real value of your car that is arrived at after considering the depreciation cost. The sum insured amount during the claim process is calculated based on IDV. Hence it is essential to calculate the IDV correctly.

  • Not Managing the No Claim Bonus Component

No Claim Bonus (NCB) is a reward to policyholders who have not claimed during their policy tenure. The policyholder has to enquire about the % of the bonus he would be getting if he maintains to stay claim-free for a certain period. NCB is useful only if you have not met with an unforeseen event, but if it’s necessary, then applying for a claim makes sense as you are paying a premium to cover your loss.

  • Not Renewing Policy before Due Date:

One of the major mistakes people make is that they tend to ignore their upcoming renewal date. Renewing policy before the due date gives you enough time to gauge different policies and offers, which helps you get the best deals. However, if you try to apply after the due date, there are chances the insurer might hand you over any policy as they know you are anyway going to buy it.

The second thing is if you are caught by the authorities or meet with an unforeseen event that causes damage to a third party, then without a valid car insurance policy, you can face monetary penalties. 

Also, if the insurance company found out that there is a huge gap between policy expiry and policy renewal, then they will conduct an inspection of the vehicle, which can be one of the factors that can influence your car insurance premium amount. There are chances of not getting NCB as well.

  • Not Verifying details

Buying a policy in a hurry and not verifying it can affect you later, especially during the claim process. Proper verification of name, vehicle number, cover, expiry date and address is necessary to avoid issues later.

  • Buying a Policy Without Understanding Terms and Conditions

Terms and conditions are long and boring to read, sometimes confusing, but understanding them is essential. Understanding a few basic points can help you during the claim process. Get the insurer’s help if you do not understand certain points. Clearing all your doubts at the right time is essential.