Don't let dealers take you for a ride on insurance world

Car insurance is mandatory by law in India. The optimum cover that you need to hold is the third party insurance. With number of companies introducing lucrative insurance packages and competition getting stiff each day some dealers and manufacturers come up with cashless car insurance for customers during festive season. They say that they will take care of the premiums for the dedicated tenure and you enjoy the benefits on motor insurance. The offer entices buyers as it helps them save money on the premium on this mandatory cover. However, according to automobile industry experts it is not possible to offer motor policy free of cost. You need to understand the pros and cons along with the hide charges behind your car policy. Regulations do not permit motor policies for tenure of more than a year. The dealers merely give an undertaking to fund the premium when the policy comes up for renewal. They might have made provisions for these payments.

Dealers bundle these policies with the entire sales package, and offer to pay the premiums instead of providing a cash discount. Nowadays for flexible sale they often put across such advertising tactics to provoke customers in buying motor insurance online. Honestly speaking, these are not free insurance covers, as an insurance policy can never be offered free. These policies are like plain vanilla policies without add-on covers like depreciation, return of invoice, etc. You need to understand the scope of coverage being offered before signing up. Besides, since the dealer would have tied up with a particular insurance company to offer the package, your choice will be restricted.

With the advent of internet insurance world has become transparent and simple. It is advisable you can compare car insurance features, benefits, discounts etc. and then buy motor insurance online on the spot. While buying insurance online pricing could be better than what is otherwise available in the market. Also, in the event of a claim, the dealer is likely to be more supportive and manage the liaison with the insurance company and surveyor. It is advisable customers should take a close look at these policies before signing up for them.

One more concern is most car insurance policies offered free do not carry the necessary riders to provide wholesome coverage for a car. The key factor to consider is the coverage of the policy in terms of riders like depreciation shields, engine protector, 24X7 spot assistance and vehicle replacement advantage. That is why you should study the policy to find out whether it is merely a third-party cover, comprehensive policy or a fully-loaded package with add-on covers. The customer needs to study the coverage closely. It is important to have a policy on zero depreciation as the deductibles could be very high on claims under such a policy. So, compare motor insurance online available in the market with the bundled cover being offered to you before making a decision.

Also, if you are signing up for policy, find out how the dealer plans to honour the commitment. Motor insurance online policies offer various benefits, discounts and no-claim bonuses. Find out how a claim will affect the arrangement. Things could get complicated, so it is better to bargain for a cash discount instead of the bundled cover, if possible. A customer, who does not make a claim in a particular year, gets a no-claim bonus (NCB), which lowers the premium for the subsequent year. Similarly, if he or she makes a claim, he or she needs to pay a higher insurance premium.