Understanding motor insurance requires familiarising yourself with certain terms like compulsory cover or own-damage insurance cover and more. Whether you are a first-time car insurance buyer or already have one, you should know that it is mandatory to insure your vehicle. The Motor Vehicles Act, 1988, further amended in 2019, makes it a compulsory document that you must possess to drive a vehicle in India legally. Thus, buying car insurance is not an option, but a compulsion.
While it is mandatory to have a car insurance policy, you have the choice to select which plan and from which insurance company you want to buy. The coverage of each policy differs depending on your purchase decision. There are two types of policies that you can buy – third party car insurance (also known as liability-only plan) or comprehensive policy.
A liability-only policy covers for the damages against any liabilities towards third-parties. As the name suggests, this policy does not cover any damages or injuries to the policyholder. On the contrary, a comprehensive car insurance includes own-damage cover as well as third-party coverage. A comprehensive plan overcomes the shortcoming of a third-party policy and is one of the best car insurance policy which offers complete protection.
So what is own damage cover under comprehensive insurance plan?
Any damage caused to your vehicle, i.e. the policyholder’s car is termed as own damage under a comprehensive policy. The damage can be caused due to many factors but not limited to accidents.
Let us look at the coverage that forms part of own damage cover –
Damage due to fires: Damage caused to your vehicle due to a fire is covered under the own-damage component of comprehensive car insurance. The cause of the fire can be an electrical fault or even due to mechanical damage to the engine.
Damage due to natural calamities: Perils of nature come unannounced. At such times, the own damage portion of your comprehensive car insurance provides financial assistance for the repair costs.
Man-made perils: In case there is social unrest due to political turmoil or riots, it often happens that vehicles are vandalised. At such times, an insurance policy that provides for own damage cover will help you pay for the repair costs.
Theft: A comprehensive policy ensures the event of theft is also covered under the own-damage element of your policy. The insurance company pays the IDV or insured declared value in case of theft of your car.
Now that you know the advantages of an own damage cover, make sure you purchase a comprehensive car insurance policy.
Apart from own-damage, a comprehensive policy includes liability-only cover too. This, in turn, protects the policyholder for any third-party liabilities resulting from injury to, or death of another person. A comprehensive plan also includes coverage for damage to third-party property, including any legal liabilities that may arise on the policyholder for damages or accidents.
Buying a comprehensive car insurance online saves you the hassles of visiting different insurance offices. Moreover, the online purchase helps compare among different insurance companies for the varied features that are on offer. One such tool that aids in comparison is the car insurance calculator. This nifty tool makes it easy to shortlist and select the perfect car insurance plan. Finally, get an insurance cover as it goes a long way in ensuring safety, both for you and others.