Car insurance: For a smooth ride during the monsoon
By Ashwini Dubey
Monsoon rains have started, as have traffic jams, gridlock and reduced visibility. While the rainy season is a good time for a cup of tea and a long drive, you also have to be too aware of vehicle safety. If we talk about the state of road accidents in India, the statistics are alarming. According to the recent World Bank report, India has only 1% of the world’s vehicles but ranks first in road accident deaths. Vulnerability to these hazards tends to increase only during the monsoon.
To protect vehicle owners against accidents, the law has made motor vehicle liability insurance compulsory. For new car owners, the rule mandates a one-year plus three-year comprehensive insurance policy when buying a car. During the second and third years, the client only has to purchase a stand-alone damage insurance policy (SAOD). But that only provides a partial shield. A crash, especially on slippery roads, can cause damage beyond that. Therefore, opting for all-risk insurance and upgrading the add-on endorsements guarantees prolonged security.
Here are some valuable racers that should be part of your car insurance policy this monsoon:
Motor protection cover
An engine is one of the most vital components as it powers the vehicle. However, non-accidental damage is not covered by the basic policy, not even in a comprehensive policy. Hence, getting this runner, especially for a country like India which has varied climatic conditions, becomes vital. Insurance companies provide hydrostatic coverage under this endorsement to protect against the results of consequential losses. For example, during heavy rain, if your vehicle is submerged in water and the engine suffers water ingress, the engine protection jumper will come in handy. Especially if you have a new car, you need to get this coverage for long engine life. It also protects against other standard issues such as oil spills, cooling system parts leaks, etc.
Zero or zero amortization coverage
The value of a car depreciates with each passing day. Even the day after purchase, it devalues by about 5%. So when filing a claim, the insurance companies will consider the diminished value of the replacement parts as the current value and compensate you accordingly. However, by purchasing this commonly known bumper-to-bumper coverage, you can redirect the liability for the depreciation of your wheels and their parts to the insurance company. Plus, an additional zero depreciation endorsement protects all vehicle components at 100%, except tubes, batteries and tires, which are covered at 50%.
When buying a car, we often pay attention to certain upfront expenses. These are tire changes, regular maintenance, etc. However, a car is a complex piece of machinery that requires consumables such as bolts, screws, coolant, lubricant, grease, etc., to keep its four-wheeled sturdy metal body running smoothly. Thus, by adding the consumables endorsement to a multi-risk insurance policy for a car less than 60 months old, you can be reimbursed for the expenses incurred on these parts during their repair.
Tire protection cover
Your car runs on wheels, so never compromise on tire protection. The tire protection cover protects your wheels against hazards such as tire blowouts, cuts, refitting labor costs, etc. Also, when traction is severely compromised in heavy downpours, having a strong wheel tread becomes paramount. However, this will not cover minor puncture repairs, manufacturing faults, tire rebalancing and alignment.
Non-claims bonus protection cover
A bonus-malus (NCB) is a reward from the insurance company for taking care of your vehicle. By not filing a single claim during the life of the policy, the insurance company offers you an attractive discount or lower premiums when renewing or transferring the policy. But this bonus is zero even if you file a small claim. Thus, by opting for the PNE protection cover, you can keep the PNE benefit intact even in the event of a claim. One can earn up to 20-50% for five years of claim-free coverage, so it’s a valuable supplement for you, especially if you’re a seasoned and careful driver.
In conclusion, your vehicle is your companion on good or bad roads. While it protects you from certain dangers, it is equally crucial for you to ensure its safety as well. So don’t forget to add those appropriate extra covers to roll that monsoon smoothly.
(The author is head of Motor Insurance Renewals, Policybazaar.com)