How Important Is Auto Insurance

If you are thinking about purchasing a new automobile, then getting auto insurance is the last thing that would come to your mind. But you should know that auto insurance is very important. The Indian Motors Act makes it mandatory for every automobile buyer to get their vehicles insured.

But the question that comes to your mind is, “why should I buy auto insurance? Why is it so important?”It is quite simple; auto insurance comes to your help when your vehicle gets damaged in case of an accident. When you buy auto insurance, the insurance company will pay for all the damages to your automobile including the repairing costs.

You have to pay a certain amount over a defined period of time to the insurance company to receive the benefits of insurance.

In short, you will lessen your financial burden. The insurance company comes to your financial support when your vehicle is involved in case of an accident.

Different Types of Vehicle Insurance

There are two different types of auto insurance policies

• Third-party liability only policy:

This type of insurance is mandatory as per the Motor Vehicles Act of 1988. It states, that the owner of the vehicle has to purchase auto insurance when he/she purchase an automobile.

• Comprehensive coverage policy:

This type of insurance offers cover against own-damages, total loss or damages done to your vehicle caused by accident, fire, theft, lightning, self-ignition, riots, natural calamities, strikes or act of terrorism.

Tips to First-Time Insurance Buyers

Buying motor insurance for the first time? Here are some useful tips that you should keep in mind while buying motor insurance policy:

Complete Your Homework

As a first-time insurance buyer, you should do a thorough research about all the available insurance companies and their policies in the market. You should find the correct source, which lets you see and compare online on the basis of numerous parameters including coverage, claim settlement ratio, low premium, additional benefits, etc. You can use the online car insurance calculator and help find the policy easily and fits your requirement.

Knowing About Claims Settlement

Claims data helps you in analysing the insurer’s history for its handling process and its claims. Remember that any new company in the market should have a low settlement ratio. As they are new, too many early claims means the claims are fake. Claims data also provides us with vital information that helps us in making the final decision on whether to choose the product or the insurance company.

What’s Third-Party Insurance?

When you buy a third-party insurance, its primary beneficiary is an outsider or person who is affected by the actions your vehicle or you. Third party insurance does not cover the original insured or the insurance company. Third-Party Insurance offers the following benefits;

• Total financial assistance and legal coverage
• Simple, seamless and speedy process to acquire
• Beneficial and worthwhile to the policyholder during unforeseen events