A car is considered by almost every owner as a valuable asset whether it is brand new or used. The second-hand car market in India has witnessed rapid growth over time. Many new drivers prefer buying a used car before a brand new one. Not only do you need to remember numerous things when buying a second-hand car, but you also have to be careful while buying a car insurance policy for it.
Used car insurance is just as important as new car insurance. The idea and purpose behind keeping your car safe from any unforeseen risk is the same. Under the Motor Vehicles Act 2019, it is illegal to drive any new or used vehicle without at least a third-party insurance policy. Apart from being a legal mandate, here are a few reasons you need to ensure that the used car you buy has car insurance coverage:
- Accident protection
The comprehensive car insurance policy works in the same way for new cars as it does for older cars. So, when you buy a used car, you should insure it to protect it from all kinds of damages from incidents like road accidents, natural and man-made disasters, theft, and vandalism. While buying car insurance online does not eliminate the chance of these incidents happening, it does protect you from the financial loss it may cause.*
- Third-party coverage
The damage of a car accident is not exclusive to your vehicle. The other vehicle involved in the accident will take damage as well. Hence, if your car is involved in an accident and damages a third-party’s vehicle, you will have to pay the cost of repairing the damage and/or injuries your car caused. If you don’t have a valid car insurance policy, you would have to cover this cost yourself. With a third-party car insurance or comprehensive insurance policy, the insurance company will take care of the expenses you pay to a third party as per the terms of the policy. This coverage is offered by both third-party liability policies and comprehensive policies. However, the latter will cost higher due to added own damage coverage. You can use a car insurance premium calculator to determine which one you should buy.*
- Protection from theft
Car theft is a frequent crime everywhere. Car insurance is a way to protect yourself from this crime. In case of theft, your insurance company will reimburse you for the value of the car, as per the Insured Declared Value (IDV).*
* Standard T&C Apply
- Useful add-ons and benefits
Comprehensive car insurance policies offer many useful add-ons and benefits. The add-on covers can provide additional services and benefits that can car insurance better for you. One of the most famous benefits is the No Claim Bonus (NCB), a concession given by the insurance company to the policyholder for not making any claims during the policy year, which allows the car owner to save money on car insurance. Please visit the official website of IRDAI for more details.
Some useful car insurance add-on covers include engine protection cover, roadside assistance cover, passenger cover, etc. Please note that add-ons require the payment of an extra premium * Standard T&C Apply. Hence, choosing to buy add-ons might drive up the car insurance prices that you have to pay. Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms and conditions, please read sales brochure/policy wording carefully before concluding a sale.