While most of the people know about their liability so they pay much attention to choosing the right insurance, few people do not take this much seriously until they have been in an accident. Here in this article, we will discuss the car insurance and after reading this article you will be able to choose the right car insurance for you.
Types Of Coverage And Its Benefit
In car insurance, you don’t only protect your car but also your health. These two things are the mains benefit of car insurance. On the following basic now we discuss the main types of car insurance.
- Liability Insurance: This type of coverage covers third-party personal injury and death-related claims or any type of damage of other person’s property that occurs due to your auto accident. In most of the state Liability coverage is required.
- Collision Insurance: This coverage pays the repairing cost of your car after an accident. It is required if you have a loan against your car because it means that the car is not yours until the loan completed.
- Comprehensive Insurance: This type of insurance covers all the damages incurred as a result of theft, vandalism, fire, water, etc. If your car loan gets completed then you should get comprehensive insurance to secure your car.
In addition, you can also add some additional coverage in your car insurance like Full Tort Or Limited Tort, Medical Payments Or Personal Injury Protection, Uninsured Or Underinsured Motorist Coverage, Towing, Glass Breakage etc. by adding some extra bucks. Now, let’s know about these additional coverage in short:
- Full Tort Or Limited Tort: You can reduce your insurance bill by a few bucks if you agreed to leave your right to sue in the event of an accident. However, this will rarely be a smart financial move.
- Medical Payments Or Personal Injury Protection: This will pay the cost of medical bills for the policyholder and passengers. You can leave it if you have good health insurance coverage.
- Uninsured Or Underinsured Motorist Coverage: This will cover your medical and property damage if your car gets into an accident with an uninsured or underinsured vehicle.
- Towing: This coverage will pay for a tow if your vehicle cannot be driven after an accident. This is not necessary if your vehicle comes with roadside assistance provided by the manufacturer.
- Glass Breakage: Some insurance companies don’t cover broken glass under their policy, so if you want to add this feature into your coverage then you have pay for it.
Insurance companies offer a variety of car insurance plans to their customers according to their need, so it becomes a challenging task to choose the right car insurance. Mostly insurance companies offer various plans with different features and these plans come at various premium prices. So, it becomes important that you do a proper research before buying car insurance. In this article we have provided you few tips that should help you in picking a right car insurance:
1. Know about your needs
When you start looking for the right car insurance you should need to know about your needs and also know with the type of insurance policy you want. Most of the people prefer these two types of car insurance policies – Third-party Insurance and Comprehensive Insurance.
In some country, Third-party insurance policy is mandatory by law. It only covers the damages of the third party. Under third-party insurance, the policyholder does not get anything for his damages.
In a comprehensive car insurance policy, the policyholder and the third party both are covered for their damages.
So, if you are searching for a basic auto insurance plan with an affordable premium amount, a third-party insurance plan would be an ideal choice. But, if you have a luxury car then it is better to purchase a comprehensive insurance cover, as it will also help you to reduce your financial liabilities in the event of your auto accident.
2. Compare the insurance plans
Once you decide about the type of auto insurance you need, it becomes necessary to compare the plans from different insurance companies before making the final decision. You can use terms while comparing any car insurance: the sum insured, inclusions and exclusion of the policy, type of add-ons offered, claim process, deductibles, etc. After comparing these you can choose a plan that is cost-effective for the amount you pay.
3. Ask about the add-ons to your insurance provider
If you are looking for add-ons then you should know that it is only available for comprehensive insurance policyholders. Add-ons are basically additional coverage options that you can purchase by paying some extra bucks. Add-ons covers against specific damages that are not covered in usual car insurance. For the best options, you should ask your insurer about the add-ons they offered and then you can choose one that suits your needs.
4. Check the claim process of your policy
One of the main objectives of a car insurance policy is to get immediate financial support in the event of an accident. So, it becomes important for you to purchase those insurance policies which can be claimed easily and quickly. After that you can also check that your insurance policy does not have a complicated procedure for the compensation of the losses.
5. You should also know about the claim settlement ratio of the insurer
Many car insurance buyers do not understand the importance of claim settlement ratio (CSR), so they don’t check the CSR of the insurance company. Before buying car insurance you must check the claim settlement ratio (CSR) of the insurer. This will give a rough idea about how many claims applications they have settled which they received in a year. It is better to purchase a insurance policy from a company that has high CSR because it will settle your claim sooner than those companies which have low CSR.
6. Never provide any wrong information in your policy
A lot of amateur car insurance buyers provide false information about their age and driving history to reduce their premium amount. Practising such things can prove to be a costly mistake at the time of claim. If your insurer finds that your information is misleading, your insurance will be cancelled and you will not get anything. So be honest while providing details in the insurance application form.
7. Take an overview of all terms and conditions of your policy
Last but not the least, before you sign the policy documents, you must take your time and read all the terms and conditions carefully and check if the terms are favourable and meet your needs. This is a critical step to avoid any legal hassles at the time of claim.
8. Final word
Buying a car insurance policy is not so much difficult as many people think. You can easily buy it by following the tips mentioned above.