It is mandatory in India for all car owners to buy a car insurance policy. So, buying a car and buying car insurance always go hand in hand. It is a bit tedious for anyone to understand the terms and conditions of insurance thoroughly. False information can add to more stress and confusion when choosing the right insurance. But it becomes a stress-job when you comprehend the terms well. Let us clear some of the common car insurance myths.
Myth 1: Minimum cover will save you money: This is one of the top auto insurance myths. Minimum cover will save you money no doubt. Going for the least possible cover that is required by the law will look cheap and profitable in the beginning, but not in the long term. You may be saving a little amount on the premium front, but you will end up spending a huge sum in case of an accident or mishap. The out-of- pocket expenses can be really high and put a dent in your wallet. Hence, getting only the mandatory coverage is not really a good idea.
Myth 2: You will lose the no-claim bonus if you port the insurance policy: The no-claim bonus (NCB) is a discount that is offered at the time of policy renewal. You get a discount if you do not make any claims in a policy year. But even if you switch from one insurer to another or delay the premium payment, your NCB will remain intact. It is one of the most important car insurance facts.
Myth 3: Car insurance policy covers everything: Do not be under the misconception that the car insurance policy will include everything. There are some exclusions you must be aware of. It is highly recommended that you read the car insurance policy documents thoroughly and understand what is included and what is excluded.
Myth 4: If your friend is driving your car and meets with an accident, his insurance will pay for the damages: No, this is not how it works. When you lend the car to your friend, you also lend the insurance to them and in case of an accident, your insurance policy will cover the damages.
Conclusion: It is important to understand the importance of car insurance and choose a comprehensive policy that offers adequate coverage. Read the fine print and then make the buying decision.
Disclaimer: The above information is indicative in nature. For more details on the risk factor, terms and conditions, please refer to the Sales Brochure and Policy Wordings carefully before concluding a sale.