What is Comprehensive Car Insurance, and How Does it Work?

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If you own a four-wheeler in India, you would know it is mandatory to ensure the vehicle before taking it on Indian roads. Failing to do so attracts heavy penalties and fines from the concerned authorities. Although the Indian law requires car owners to have at least a third-party insurance as basic coverage for their vehicle, there is another option for those looking for broad coverage. We’re talking about comprehensive insurance. This article will answer all your questions if you’re new to motor insurance and aren’t aware of a comprehensive insurance policy. So let’s read till the end to know everything you should know about this insurance policy.

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What Is Comprehensive Car Insurance?

The policy that covers the insured against its own damages and financial damages/losses from road accidents towards a third-party individual and property is the comprehensive car insurance policy. It covers up for the limitations third-party insurance has; hence, it comes with a slightly higher premium cost than third-party insurance. The insurance covers the insured against both its own damages and third-party liabilities. It is considered ideal motor insurance and is heavily recommended.

Comprehensive insurance also covers the damages caused to your car due to natural disasters, like an earthquake, fire, floods, etc. It also ensures you get the sum insured value if your car gets damaged beyond repair or gets stolen. These benefits alone make it worth investing in comprehensive car insurance.

Advantages of Buying a Comprehensive Car Insurance

Now that you understand what comprehensive car insurance is, let’s quickly check out some of its main benefits.

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  • Covers Own Damages

Comprehensive car insurance will cover the financial damages if your vehicle ever meets a road accident and gets severely damaged. It will save you from the sudden financial burden while ensuring both the vehicle and the driver get the required treatment without worrying about arranging funds. The insurer will also bear costs related to the treatment expenses of the insured or driver if you have taken a comprehensive policy.

  • Covers 3rd Party Damages

No matter how good you’re at driving, the chances of encountering road accidents cannot be entirely overruled. If you accidentally end up hurting any individual or damaging any property in the process, you will be liable to compensate all of them for the due damages. Having comprehensive insurance by the side ensures you don’t have to bear any out-of-pocket expenses to meet third-party financial liabilities. The insurer will take care of it.

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  • Has Provision for Add-ons

Unlike third-party insurance, you get the option to enhance the coverage of your policy by purchasing separate add-ons. Riders or add-ons are additional coverage benefits that increase your standard policy coverage scope. With comprehensive car insurance, you can get add-ons like a return to invoice cover, zero depreciation cover, roadside assistance cover, etc.

But before buying any add-on, keep in mind that every add-on you purchase will increase the premium amount. You can easily use a car insurance premium calculator to determine what the premium will be after including the add-ons of your choice. It will help you decide which add-ons are needed are which aren’t.

How Does Comprehensive Car Insurance Work?

Comprehensive car insurance is an agreement between the insurer and the insured that the former will provide financial coverage to the latter in the event of road accidents or other covered events in exchange for a timely premium payment. For example, if you meet a road accident and end up damaging your vehicle in the process, you won’t have to bear the repair costs from your own pocket.

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The insurer will be liable to compensate you for the cost of the damage and also cover up the financial damages caused to any third-party individual or property. To avail of this benefit, the insured only has to file a claim with the insurer after the accident, and the insurer will take care of the rest.

Ready to Secure Your Car Under the Best Insurance?

The sole purpose of getting a car insured is to receive adequate assistance and compensation during the time of need. Hence it becomes crucial to pick the correct type of car insurance. Now that you’re aware of what comprehensive car insurance is, why it is better than third-party insurance, and how it works, you shouldn’t face difficulty while choosing the right insurance for your four-wheeler.

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