Why Get Car Insurance| North Loop Official Blog
North Loop Logo
North Loop
09 Oct 2020

Why Get Car Insurance

thumbnail for Why Get Car Insurance
Credit: North Loop

What is car insurance?

Car insurance is a contract with an insurance company to protect you against financial loss in the event of an accident or theft of your car. The insurance company agrees to pay for your losses as outlined in the policy in exchange for regular premiums.

Types of insurance -

There are three types of insurance policies in India -

First-party car insurance - In this type of car insurance policy, any damages incurred by your car or any injuries suffered by you are covered by the insurance company as per your policy details. Many insurers also cover damages to your vehicle due to natural calamities such as earthquake, cyclone, flood etc. However, the premiums for such policies are usually higher. Another thing to note here is that the damages or injuries dealt by a third party do not get covered in this type of insurance policy.

Third-party insurance - Any damage or injury suffered by a third-party due to a collision with your car is covered by the insurance company here. This type of policy is mandatory as per the laws set by the Government of India. That is why, before using the vehicle on the road, it is necessary to have purchased this policy. While this policy covers all third-party damages or injuries, it does not provide the same for your car.

Comprehensive car insurance - This car insurance policy provides protection for costs incurred due to damages or bodily injuries, coverage against third-party liability and a personal accident cover. This policy is not mandatory by law but gets recommended as it offers extensive coverage to both you and the car for both natural and man-made calamities such as earthquakes, floods, cyclones, fire, theft etc. However, the premium payable in this type of insurance policy is considerably higher as compared to the others available.

Get a zero-balance, no-fee NRE/NRO account with North Loop in 5 minutes

What car insurance covers?

If you want to know what car insurance covers and what the leading banks and institutions of the country provide in their policy to reduce your financial burden, you must read the following points -

Car insurance policies provide coverage against a wide range of damages, accident-related injuries or theft induced financial losses. The vast spectrum of aspects covered by car insurance policies reduces your financial burden due to unforeseen events by a large extent.

Car insurance policies provide coverage against both natural and man-made disasters for damages that occur to your car. That includes any financial loss that occurs due to incidents beyond your control like earthquakes or fire.

A comprehensive car insurance policy provides coverage against theft or loss of your car, wherein it's predetermined IDV (Insured Declared Value) gets covered by the insurance company.

Most car insurance policies also offer the opportunity to opt for add-on policy covers that provide coverage against the expenses incurred for the treatment for any injuries sustained during the time of a collision.

Benefits of a car insurance policy -

All motor vehicles must have an insurance policy as per the rules and regulations laid down by the Motor Act of India. Therefore, it is of utmost important to buy a car insurance policy to avoid any legal actions. Also, cars have become a necessity for most of us today and have become an indispensable part of our lives for commuting and travelling. More so, with the current global health scare, most people are preferring to travel in their vehicles for safety and hygiene reasons instead of using public transport. That has led to a massive increase in the number of vehicles plying on the road with an equally high rate of road accidents. That is the reason, having a car insurance policy can prove to be very beneficial as they save a lot of money and financial stress during unprecedented and unfortunate events.

Advantages of purchasing car insurance policies online-

Purchase and renewal of policies are easier and more convenient.

Minimal documents get required on online platforms.

It is far more cost-effective as no middlemen are involved and also saves a lot of time.

It provides easy access to various policies and helps in quick comparisons between them.

No-claim bonus and other benefits can get availed on online insurance policies.

You can opt for a car insurance policy with North Loop. We offer the best policies with high covers at low premiums and quick 100% digital renewals.

Sign up with us now.

Save money with

No-fee banking, investments, remittances & insurance for the global Indian

This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended be advice. You must obtain professional advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax, investment or other professional advice from North Loop or its affiliates. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date. All opinions expressed do not reflect the views of North Loop nor are endorsed by North Loop.