Accidents are beyond the control of human beings and with increasing in number of vehicles on road accidents have become very common. So having an auto insurance has become very essential.
There are different auto insurance available in the country-
Auto insurance generally comes with two types of cover Third party cover and Comprehensive Cover.
According to the Motor Vehicle Act 1988 , it is mandatory to have third party insurance. So the question arises what does "third party cover" means. Third party covers the liabilities the insured party has to pay due to damage or injury occurred to any other individual by him/her. The insurance does not cover any damage being caused to one's own property.
Comprehensive cover as the name indicates includes a package that takes care of damage being occurred to the individual's own vehicle whether it be a natural calamity like flood, earthquake or man made calamities like theft, burglary, riot, strikes etc. This policy cover takes care of damage occurred to the third party as well. So the premiums for comprehensive policy covers are costlier than third party insurance covers.
The India Motor Tarrif Act has listed down certain factors on the basis of which the insurance companies determine the premium of the auto insurance. So when you are going to apply auto insurance, then keep in mind some points listed down below:
1. IDV-Insured Declared's Value is the current market value of the vehicle and is calculated by deducting depreciation from the manufacturer's listed price.It is basically the sum insured. Every year when the policy is renewed the IDV is calculated as the depreciation value goes on increasing. So every year the premium amount also keeps on decreasing.
2. For private cars the make, model and year of manufacture also play an important role in determining the premium amount.The location in which the vehicle is to be driven also plays a major role for example the premium in the metro cities will be higher than the premium in other cities.
3. Gender and profession of the driver are also considered while determining the premium price.
4. The commercial vehicle will generally have a higher premium than vehicles bought for personal use.
5. Voluntary deductibles is the amount of money that is the responsibility of the insured. The higher the voluntary deductible amount the lesser will be the premium amount.
6. The insurance record of an individual can also play a major role in determining the premium amount for instance if an individual has not made a single claim in the past, the individual is eligible for "No claim bonus".
7. A member of a recognized automobile association is also liable for discounts in premium. Moreover the safety devices installed in a car can also make the owner liable for discounts in the premium amount.
8. The type of coverage provided by company also affects the premium amount.The higher the coverage provided by the insurance companies the higher will be the premium amount.
In India there are a number of companies offering auto insurance. Here is a list of some of them: