Know Everything About Car Insurance From its Types to Claim Settlement

You feel like at the top of the world with the new car as it is the moment to cherish throughout the life. But when your loved car meets an accident, you feel burdened to bear a lot of costs to repair the damaged parts if the vehicle does not have the car insurance cover. The car insurance is made against purchased cars to indemnify losses resulting from the traffic accidents. Let’s understand car insurance in detail.

Car insurance types

Car insurance can be classified into two types- comprehensive and third party. These insurances, which are valid for a year, must get renewed each year. Premium for such insurances depend on factors like classification and value of cars. Now see each of the two insurance types in detail.

Comprehensive Insurance

Under comprehensive insurance, car can be insured against any risk resulting from damage or theft, driver’s death and passengers in the vehicle during the time of accident. Typically, this insurance cover is applied to cars damaged in the face of natural calamities like earthquake, typhoons, floods, as well as other circumstances such as strikes, riots, thefts, etc.

Third Party Insurance

Third party insurance offers cover for the damage inflicted to other vehicle by your car only and not the theft, accidents or damage to your vehicle. Coverage under the insurance type includes permanent injury/death of a person, damage caused to the property, etc.

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After knowing the types of car insurance, let’s keep our eyes on the clauses.

Clauses of car insurance

You need to be aware of certain clauses that form part of the car insurance as the ignorance of the same will prevent you from claiming for any damages to your vehicle. You would not be able to claim for the damages occurred with the insured car owing to wear and tear of tubes and tires, electrical or mechanical breakdown, depreciation/any consequential loss on car, vehicle being used outside India, a person driving car with an invalid/no license, an individual having liquor or drugs while running the vehicle, etc.

How to claim insurance

You are required to follow a list of things below to claim insurance for the damages caused to your car.

  • Call the insurance company to file a claim. The company will ask for details like your contact number, car insurance policy number, and name of the insured person, date and time of accident, car model, and location of loss, driver’s name, brief description of the accident, place and contact details of the insured person if the individual intimating the claim does not have the insurance cover.
  • In case of accidents, you are required to take a note of the number of the other vehicle involved in the accident
  • Ensure you keep the names and contact details of witnesses
  • Contact the toll-free number of the car insurance providers to obtain your claim number/reference number
  • Your insurer can reject the claim if you delay the claim intimation
  • During the time when the car is theft, you better inform the insurance company about the incident on the phone after doing the same to the police. You can provide a written intimation later on.
  • You are required to submit a list of documents to claim for the damages, including a duly signed claim form, registration certificate (RC) copy of car, FIR, driving license, original estimate, and original repair invoice & payment receipt
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Cashless and reimbursement claims

In the face of changing insurance features, you can now repair your car and claim for the insurance. The insurer makes payment for repairs at the company’s preferred garage but exclude the cover for expenses not covered under the policy. This is called cashless insurance claim. Reimbursement claims can be asked for when you spend money to get the car repaired at your preferred garage. Now look at the merits and demerits of both the claims.

Merit and demerits of cashless claims

Merits

  • With cashless claims, responsibility lies entirely with the insurer
  • Car would be taken to the garage by the surveyor and will get repaired there. The surveyor then will return the car back to the owner.
  • The company’s network of garage is usually quite reliable
  • The service of these garages are considered to be better than any other local garage

Demerits

  • You will have to go through a lot of formalities before anything begins on the part of claims
  • Often the repair is delayed as surveyor takes a lot of time to complete inspection
  • The garage chosen by the insurer might turn out to be expensive and as owner has to pay a certain portion of the expenses, he/she will have to shell out more than what they think of

Merits and demerits of reimbursement claims

Merits

  • With reimbursement claims, you have the freedom to get the car repaired at your preferred garage
  • Further, you can repair your car by the mechanic who you know can do the job better
  • Immediately after the inspection, the repair work will take place
  • As this claim settlement type offers you the freedom to choose your garage, you can opt for the best option fitting your budget
  • This also gives you the opportunity to repair other parts of the car which would not have been damaged during the accident
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Demerits

  • You will be entirely responsible
  • Even though you may take comfort from the fact that the car is getting repaired at your preferred garage, but it has been found that the services of the local garage have been below expectation

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