Whenever you buy a car, you spend days on researching and comparing features; right from air bags to the touch and feel of the dashboard, everything is taken into consideration. But when it comes to investing in car insurance, you blindly follow other’s advice.
The majority of times, you get car insurance believing that it will cover you financially in case of an accident. Although, the terms are mentioned in the contract, but do you really understand what the terms like ‘zero depreciation cover’, third party cover’, and cashless garage mean? Confusing, isn’t it? To make things a tad easier, here’s a quick guide for you to get these terms:
Own Damage Premium (ODP)
Own Damage Premium protects your vehicle against damage caused due to accidents that are out of your control. These include natural calamities like earthquakes, floods, tornados, hailstorm, etc. and man-made disasters like fire, riots, explosions, etc.
Insured Declared Value (IDV)
To keep it simple, it is the current market value of your car.
IDV is the maximum amount that the insurance company will pay you for your insurance in case your car is totally damaged or is stolen. So when you buy or renew your insurance policy make sure not to quote an IDV that’s lower than your vehicle’s current market value. After all, you don’t want an inadequate compensation, do you?
Zero Depreciation Cover
Often, when you make a claim, most of the insurance policies deduct depreciation on any replaced parts in your car. With Zero Depreciation Cover, the insurer waives off the depreciation on these replaced parts, and you might get higher claim amount.
No Claim Bonus (NBC)
As the name suggests, it is a bonus (a discount) that you get when you haven’t made any claim in the previous year. NBS lowers the insurance premium you need to pay at the time of renewal by a maximum of 50%.
One more reason to drive safe, isn’t it?
Third Party Cover
Third Party Cover is a statutory requirement under Motor Vehicles Act. This cover protects you (vehicle owner) from financial loss that could happen as a result of permanent injury, death or damage to the third party or property of the third party. It is called ‘the third party’ as the benefits will go to someone other than the two sides involved (owner and the insurer) in the contract.
Personal Accident Cover
It is a cover that protects you financially in case of any unexpected event like accidental death or permanent disability in a road accident. Do remember that every car insurance policy doesn’t cover Personal Accident Cover. So, just this one up before you apply for car insurance.
Have you ever heard about Cashless Garages?
Most of the times, when our car meets with an accident, we get it repaired and pay for the expenses and then, later on, get it reimbursed from the insurance company. But, under this Cashless Garage facility, the insurer directly makes payment of its share to the garage for accidental damage. The only thing that you must take care is that you will have to make sure that you take your vehicle to one of the garages preferred by the insurance company.
Do you know that your car insurance covers not only you but also the other person who suffers damage (personal or property) because of you? So, in case you bump into someone’s fencing, fret not, your motor insurance will get it covered! In the case of a fatal accident, if a person dies, the amount will be paid to the heir of that person.
The basic purpose of getting car insurance is to protect your vehicle, yourself and your co-passengers in a case of damage caused due to an accident. Go for a car insurance that meets all your purposes and gives you maximum security.