Apart from the usual traffic, accidents have become the most common sight on roads. The nature of an accident is unfortunate and highly unpredictable. The magnitude of an accident is directly proportional to the post-accident charges on the people involved. According to a recent study, on an average, if you get your license at 16, there are good chances to experience a crash by the time you’re 34.
In most cases, when an accident occurs on the road, it’s due to the carelessness of either of the two drivers. Irrespective of whose fault it is, both the parties have to bear the loss. The grief multiplies when your new or high-end car is damaged and it’s not even your fault. However, it is the fear of finances that takes the front seat. In both these cases, the solution is served in the form of car insurance. Before settling on an insurance plan, it is advised to compare car insurance policies before picking one out.
Do Not Claim Your Car Insurance
When you have car insurance, it makes complete sense to file for a claim, in case you or your vehicle suffer major damages. However, there are certain instances where using your own money would be more profitable. Mentioned below are three such instances:
- When you have only third-party car insurance: In India, the most popular types of car insurance are comprehensive car insurance and third-party car insurance. As the name suggests, third-party insurance offers cover to the third-party in case of an accident or mishap caused on the driver’s account. On the other hand, comprehensive insurance offers a wider range of benefits where it covers the damage incurred by both the parties. Hence, if you have only third-party insurance, your claim will not cover you or your own vehicle. The table below from our article shows the difference between the Third Party and Comprehensive Insurance Policy for Cars and Bikes
| Coverage | Third-Party Insurance | Comprehensive Cover |
| Damage to you or your vehicle due to collision | No | Yes |
| Damage to a third-party vehicle/person | Yes | Yes |
| Your vehicle is Stolen | No | Yes |
| Damage due to natural causes | No | Yes |
| Damage due to fire | No | Yes |
| Depreciation of vehicle | No | No, Optional Add On |
| Personal Accident cover | No | Yes |
| Engine protection | No | Optional Add-on |
| NCB protection | No | Optional Add-on |
| Invoice cover | No | Optional Add-on |
- When the cost of fixing your car is lower than the No-claim bonus (NCB): If you’ve proven your mettle by being a responsible driver and luck favoured you all along, chances are that you haven’t claimed your car insurance in a long time. This helps you to get a discount of up to 50 per cent on your next premium. This discount is referred to as ‘No-Claim Bonus’, as shown in the image below.
The standard insurance premium has two components, own damage premium and third-party premium. NCB discounts are applicable only on the former. The discount results in a profit even after the cost of the third-party premium is included. Every year you do not file a claim, your NCB rises. But, once a claim is made, the NCB goes back to zero. This will increase the premium amount for the next year. Hence, it is advisable that for minor damages, you avoid filing a claim and pay it from your own pocket. This can prove to be a profitable step in the longer run. Besides, the newly added ‘add on’ feature helps retain the NCB while the insurer can avail a maximum of three claims for the entire policy.
- When the third-party is at fault: When this happens, the most important step is to file a First Information Report (FIR) and prove that it wasn’t your fault. Once this is done, you can file for a third-party insurance claim. Although it is a slower process, it will help you to avail your NCB benefits.
sample Car Insurance Policy
Who would have thought that by not claiming for insurance, one can gain greater benefits? Try companies like Bajaj Allianz General Insurance, to find the best car insurance online and live a carefree life.
