With the increasing population, more and more individuals are purchasing cars. With the ease and convenience of a car, it has almost become a necessity in today’s day and age. But having a car is not enough. You need to purchase car insurance too. There are quite a few car insurance myths that prevail. Let us look at a few myths and the reality about them.
Myth 1: The premiums decrease as your car gets older
Many individuals believe your car insurance premiums decrease as your car gets older. But although the insured declared value or IDV decreases, there are other factors that influence the premium. Driving records, distance driven, age of the vehicle and claim history are some to name a few. These factors along with the IDV play an essential role that may increase the premium too.
Myth 2: Car insurance purchase is tiresome
While it may not be, it was a thing of the past. With comprehensive car insurance plans available online, you quickly make your purchase. All you need to provide are basic details about your car and select a favourable plan that checks the right boxes.
Myth 3: You lose NCB on switching insurance companies
The fact is NCB or no-claim bonus is linked to the policyholder and not the vehicle. Thus, even if you change your insurance company, the NCB can be transferred. After the expiry of your policy, this no-claim bonus is valid for 90 days.
Myth 4: Insurance isn’t required for responsible and safe drivers
Third-party or liability insurance cover is mandatory and required by the law. So there is no workaround to not buying a car insurance policy. However, a liability cover has certain limitations that can be overcome using a comprehensive policy. In case of an accident or mishap, the financial loss is far greater than the premium you might save by not buying one. So, do not ignore the importance of an insurance cover.
Myth 5: The insurer pays the entire cost in case of total damage
The real fact is that the claim amount is based on the Insured Declared Value. It is the maximum amount that your insurer pays for damage beyond repair. When paying the claim, depreciation is accounted and hence the entire amount isn’t paid by your insurer. However, there are car insurance add-ons that can increase your insurance cover like the return to invoice cover.
Myth 6: You need to renew with the same insurance company
The fact is at each renewal date, you must evaluate for any changes in your insurance needs and what your plan offers. Similar to the no-claim bonus, you can also change your insurer too. A car insurance calculator is a handy tool that can help you make the right choice considering all your requirements. It is made available by all leading insurance companies on their websites to ease your insurance purchase.
Myth 7: Claim settlement is cumbersome
If you opt for an insurer with an easy claim process, your entire claim experience can be a breeze. With internet technology catching up, you can lodge claims online and have a peace of mind during the entire claim process.
Make sure to familiarise yourself with comprehensive car insurance and the car insurance myths and underlying truth about them. Understanding insurance is simple if you are informed when buying one.