Every vehicle on the road needs at least a third-party policy by law. A comprehensive policy adds cover for damage to your own vehicle, and add-ons let you extend that cover further. Here is what the common ones do.
Third-party vs comprehensive
Third-party insurance covers injury or damage you cause to other people or their property. It does not pay for repairs to your own vehicle. A comprehensive policy covers both, including damage from accidents, fire, theft and natural calamities. For anything but a very old vehicle, comprehensive is usually the sensible choice.
Zero depreciation cover
Normally, an insurer deducts depreciation on parts like plastic, rubber and metal when it settles a claim, so you pay the difference. Zero depreciation removes that deduction. It is most useful for newer cars, typically in the first few years, and often comes with a limit on the number of claims per year.
Engine protection
Standard policies usually do not cover engine damage from water ingress or oil leakage. If you live in an area that floods or you drive through waterlogged roads, this add-on can save a very expensive repair.
Roadside assistance
Covers towing, flat tyre help, battery jump-starts and emergency fuel. Check whether your car already comes with a manufacturer's assistance plan before paying again.
Return to invoice
If the car is stolen or declared a total loss, this pays the original invoice value rather than the depreciated market value. It is worth considering for new, expensive cars.
Consumables cover
Pays for items such as engine oil, nuts, bolts and coolant that are normally not included in a claim.
No claim bonus
You earn a discount on your own-damage premium for each claim-free year. Think twice before making very small claims, since you can lose the bonus. A no-claim-bonus protection add-on can help here.
Insurance is a subject matter of solicitation. Please read the policy wordings carefully before buying or renewing.
FinMighty TeamInvestment, loan & insurance advisors, JaipurThis article is for general information only and is not personalised financial, tax or legal advice. Please see our Disclaimer.
