Top 5 Add-On Covers For Your Motor Insurance

While motor car insurance is considered as a recurring expenditure by some, there are a few who understand the real necessity of a motor insurance so as to cover their vehicle from every unforeseen situation. Unlike third party liability, which is mandatory to have by law in several states, purchasing add-on covers for motor insurance is a choice.

The add-on covers are very useful, especially for roadside assistance in case of a failure of the vehicle. The cost of the add-on covers is fixed as per the Insured Declared Value (IDV) of the vehicle and engine size. Most insurers offer add-on covers on a yearly basis, along with the regular motor insurance policy. You must note here that mid-term additions or discarding add-on cover is not permitted.

Here's a list of 5 popular add-on covers which almost every general insurance company provides for motor insurance in India:

1. Personal Accident: This cover protects the owner and the driver if he is employed. In the case where an owner is a driver, a policyholder’s nominee will get a 100% claim if he/she dies in an accident. The policyholder will get 100% claim as per the sum assured in case of permanent disability. Remember, no claim amount will be paid if the owner or the driver does not hold a valid driving license. Also, if the owner has many vehicles, the add-on will be granted only for one vehicle for which the insurance is financed. The add-on cover for the loss of personal belongings covers theft of gizmos like a laptop or the mobile phone put inside the locked vehicle.

2. Zero depreciation: It is the most popular add-on cover that ensures that the policyholder can receive a full claim on the value of parts that are replaced after an accident. Most insurance companies offer zero depreciation for the first three years from the time of purchase of the new vehicle. As the vehicle gets old, the premium for zero depreciation add-on policy usually becomes pricey.

3. Engine cover: Since water-logging is common in metropolitan cities, getting this add-on cover is highly beneficial for you. It protects the engine of your vehicle in case of flooding during monsoon. Any damage caused due to hydrostatic lock (if one repeatedly tries to run a wet engine), is not covered under the standard motor insurance policy.

4. Breakdown assistance: It takes care of the car in case of breakdown or accident on the road. The policyholder will have to call the helpline number of the insurer so that they can easily reach him. This cover will recompense for the minor repairs on the road and the cost of spare parts, if required, will have to be met by the policyholder. The policy covers replacing of alternate battery, flat tyre, alternate key, towing vehicle, and even emergency fuel & alternative vehicle. To get the replaced keys of the vehicle, the policyholder will have to submit an identity proof. Typically, the insurers help you in towing the vehicle to the nearest garage that is within a reach of 25 kilometers.

Important things to keep in mind:

1. Any vehicle that breaks down on the road requires third party insurance under the motor vehicle act.

2. The insurance company has to ensure that the cover is available at their underwriting office.

3. According to the motor vehicle act, the third-party insurance is extensive in case of an accident and the entire debt has to be paid by the company.

4. While third-party insurance cover is necessary, a policyholder can choose to buy an add-on covers to the basic motor vehicle insurance.