10 Things You Never Knew Car Insurance Covered

Before we dive into the extent of coverage in car insurance, it is important to note that every insurance holder must carefully read their policy documents. Many insurance holders are unaware of how insurance for cars can come to their aid because they never bother to read the terms and coverage mentioned in the policy document. Not knowing the policy inclusions and exclusions when you buy car insurance can lead to you losing money as you don’t know when you can and cannot raise a claim. Acknowledging this, let’s take a look at some surprising features and facts about car insurance that policyholders are commonly unaware of:

More than Accidental Coverage

Most insurance holders think that their motor insurance is only of use in the event of an unfortunate road accident. However, your insurance for cars will also cover damages and losses beyond the insurance holder's control. These situations include natural calamities such as floods, landslides, earthquakes, etc., and manmade disasters such as fire, theft, riots, terrorist activities, etc.

Waiver on Towing Charges

Spontaneous road trips always sound like an exciting proposition until your car breaks down in a remote location and you are stranded in the middle of nowhere. Fortunately, your motor insurance can shoulder the inconvenience of searching for garages or mechanics, even at odd hours, if you have opted for an additional roadside assistance cover. Even without the cover, however, if your car breaks down, your car insurance can compensate for the towing charges to get your vehicle to the nearest garage so it can be up and running in no time.

Even in the unfortunate event of an accident, policyholders can claim up to a certain amount for towing charges which is included in their basic cover when they buy car insurance.

Paper-Less Car Insurance Renewal

The bureaucratic and cumbersome documentation is what makes several individuals turn their heads away from purchasing car insurance. However, with the advent of the internet, insurance providers have made it increasingly simpler to invest in motor insurance online. This process gets even better with car insurance renewal online because insurance seekers can complete the process with zero documentation. Through seamless digital payments, renewing your car insurance is a matter of just a few clicks in less than a few minutes. It is important to know when your policy concludes so that you can renew your cover before it lapses.

Discount on Premiums for Third-Party Coverage

Third-party car insurance is the mandatory cover for every car owner to legally drive on Indian roads. It compensates the third party for any damages involving the insured vehicle. However, if the policyholder believes they can avert raising third-party claims or pay for them out of their pocket, they can get a discount on the claims for third-party coverage.

Consumables Cover in Car Insurance

If the insured car is involved in an accident, then the insurance company only compensates for the car, not the accessories fitted inside. However, with consumables cover in car insurance, you can separately secure the accessories in your car by paying an additional premium. Although covering consumables expenses is available as an add-on service by paying an extra premium, it is still more cost-effective than replacing the accessories by paying for them from your pocket. These consumables include gas in the air conditioner, gearbox oil, engine oil, oil filter, nuts and bolts, and so on.

Loss of Personal Belongings

We tend to carry many more things in a car than in a two-wheeler simply because the former has more space. However, have you ever wondered what happens to your personal belongings if they get damaged in an accident? Those who would like to secure their personal belongings can extend their basic car insurance coverage to cover the damage and loss of personal belongings. While opting for this add-on, the policyholder should carefully read all the inclusions and exclusions to know what would and would not be covered before raising a claim.

Zero Depreciation Cover

No matter how much you cherish your beloved car, in financial terms, it is still a depreciating asset. But you need not bear the expense of depreciation as a zero-depreciation cover is curated to shoulder the burden of deprecation for you. With this add-on, the policyholder can receive the complete sum insured without deducting the cost of depreciation on the vehicle parts.

Return to Invoice Cover

In the unfortunate event that your vehicle is stolen or suffers total (i.e., irreparable) damage, this cover would compensate the policyholder for the deprecation cost of their vehicle. In simple terms, the return to invoice cover compensates the policyholder for the difference between the purchase price and the compensation amount. It also compensates the policyholder for the charges of registration and the road tax levied on the car.

Engine Secure Cover

The engine is the most expensive part of your car. It is the part that powers your vehicle. However, basic comprehensive car insurance does not secure your car's engine. So, to extend the coverage in car insurance to your engine, insurance seekers have the option to opt for an engine secure cover. This way, if your car's engine is damaged, your car insurance can look after repairs and replacement of your engine without having to pay from your pocket.

Tax Savings

Those who use their car for personal reasons cannot receive any tax deductions on their insurance for cars. However, business owners who are using their vehicles for business can avail of tax deductions on the premiums paid towards motor insurance. This benefit is available under Section 88 of the Indian Tax Act. To get this benefit, the vehicle must be registered under the company's name or a business or the business owner’s name, wherein the latter is the sole proprietor.

Car insurance may seem complicated in the beginning, but knowing the basic terms and inclusions and exclusions in a policy cover can help an individual make an informed insurance purchase. The comprehensive motor insurance by Tata AIG comes with a choice of 12 unique add-ons to strengthen the basic cover.

When you buy car insurance, make sure you read all the documents carefully. This way, you are aware of the extent of your car insurance coverage to use the policy effectively to your advantage.