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Car insurance protects you against financial loss arising from unfortunate events like road accidents, theft, fire, natural disasters, man-made acts, animal attacks, and third party liabilities. A car insurance policy is also a legal requirement in India for all vehicle owners, ensuring peace of mind while driving.
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Cited below are some important features offered under a car insurance policy:
| Categories | Key Features |
| Third-party Damages | Covers TP (third party) death, injuries & property damages |
| Own-Damage (OD) Cover | Covers replacement & repair costs for own damages (offered under standalone and comprehensive policies) |
| No Claim Bonus (NCB) | Up to 50% |
| Car Insurance Premium | Starting at ₹ 2094* |
| Discounts | NCB, Anti-theft, AAI Membership, Deductibles |
| Add-on Covers | Over 10 add-ons like Zero depreciation, Roadside assistance, NCB protect, etc. |
| Buying/Renewal Process | Online |
| Personal Accident Cover | Up to Rs. 15 Lakh |
| Cashless Garages/Repairs | Available |
*TP insurance price for less than 1000cc engines. **All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard terms and conditions apply.
A car insurance policy or four-wheeler insurance is a contract between the vehicle owner and the insurance company. In return for a nominal premium, the car insurer financially protects the insured from unforeseen events like accidents, theft, fire, calamities, and third-party liabilities. Moreover, a valid car insurance policy can also save you from hefty traffic fines.
A comprehensive car insurance policy covers unforeseen damages to your four-wheeler and third-party liabilities, including death and property damage. Moreover, it includes a Personal Accident (PA) cover that compensates for injuries, disability, or death of the owner/driver.
A car insurance policy offers the following essential benefits to vehicle owners that help protect them both financially and legally:
Car insurance is compulsory under the Motor Vehicles Act of India. All vehicle owners need third-party coverage to drive on public roads. While this is the basic required coverage, you can opt for comprehensive car insurance for enhanced protection.
Car insurance offers protection against 3rd party injuries, fatalities, and property damages arising from road accidents by the insured vehicle. While it offers up to Rs. 7.5 Lakh coverage for property damages, there is no limit on death claims.
Own damage insurance or OD insurance covers accidental damages and losses to your own vehicle.
The mandatory PA cover under car insurance provides financial protection to the insured in the unfortunate event of permanent disability or death from accidents.
The three types of car insurance in India are third-party car insurance, standalone own-damage insurance, and comprehensive car insurance. You can opt for any of these plans that fit your coverage requirements and budget.
Third-party insurance or liability-only insurance is a mandatory coverage for car owners to drive on Indian roads. It provides financial compensation for injury, death, and property damage to the third party by the insured vehicle.
Under third-party insurance, property damages are covered up to Rs. 7.5 Lakh and the compensation for third-party injury/death is unlimited. While it doesn't cover damages to the insured four wheeler, it's an essential step towards responsible driving.
Comprehensive insurance offers coverage for both third-party liabilities and damages to the insured vehicle. With comprehensive car insurance, you can avail of cashless repairs at the insurer's network garages.
Additionally, you can enhance your coverage with add-ons like roadside assistance and zero depreciation for a small extra premium.
A standalone own damage policy protects your own vehicle from damages due to accidents and other losses including theft and fire. This car insurance policy can be paired with an active third-party policy.
Under this cover, your insurer pays for repairs and part replacement. If your 4 wheeler suffers a total loss, the insurer compensates you up to its IDV (Insured Declared Value).
The IRDAI decides the third-party car insurance rates. The premium prices are based on the engine capacity and are listed below:
| Engine’s Cubic Capacity (CC) | Third party Car Insurance Renewal Price | Third party Car Insurance Price for 3 Year |
| Less than 1,000 | ₹ 2,094 | ₹ 6,521 |
| More than 1,000 and less than 1,500 | ₹ 3,416 | ₹ 10,640 |
| More than 1,500 | ₹ 7,897 | ₹ 24,596 |
Here is a table comparing coverage offered under different types of car insurance policies in India
| Coverage Offered | Third-party Car Insurance | Comprehensive Car Insurance | Own-Damage Car Insurance |
| Third-party property damage | Compensation of up to Rs. 7.5 Lakh for property damage. | Compensation of up to Rs. 7.5 Lakh for property damage. | Only covers own damages and can be purchased along with an existing TP plan. |
| Third-party bodily injury/death | Unlimited compensation for death and disability of third parties by the insured 4 wheeler. | Unlimited compensation as per MACT for the death and disability of a third party | TP liabilities are not covered, so no compensation is offered. |
| Own damages | Covers TP liabilities only. | Own damages arising by an accident, theft, fire, calamities, etc. | Covers damages caused by accidents, collisions, theft, calamities, fire, etc. |
| Insurance Premium | Lower. Decided annually by IRDAI. | Higher. Covers both third party and own damages. | Lower than comprehensive but higher than third-party insurance. |
| Vehicle Theft | Coverage is not offered for the insured's car theft. | Partial or total losses arising out of the theft of the insured 4 wheeler are covered up to its IDV. | Covers losses arising out of theft or burglary. |
| Personal Accident (PA) coverage | Yes. You can opt for this cover (up to Rs. 15 Lakh) with this policy. | PA cover is provided to the driver/owner. | You can purchase a PA cover if not already with the TP plan. |
| Availability of add-ons | Add-ons are not available. | Add-ons like zero dep, NCB Protect, Consumables cover, etc., can be purchased. | This cover is customisable with the help of add-ons like NCB Cover, Nil Depreciation, Tyre Protect, etc. |
It takes a few minutes to buy or renew car insurance online. You need to enter your car details, contact information and other asked details to choose the policy as per your need on Policybazaar.com.
Add-ons in motor insurance are additional covers that enhance the coverage of your existing policy. You can purchase these add-ons by paying some extra premium.
Let's discuss four-wheeler insurance add-ons in detail:
A standard car insurance policy does not cover the depreciation sustained by the insured four wheeler and its parts. However, a zero dep or nil dep add-on offers this coverage. With this add-on, you do not have to pay for the depreciation value.
This cover is subject to specific claims during the policy tenure and is available for 4 wheelers up to 10 years old. Both compulsory and voluntary deductibles will still apply as per the case despite zero depreciation cover.
An NCB Protect cover helps save your car insurance premium even if you raised a claim during a policy year. With this add-on, you can make a claim and still get a discount of 20% to 50% on car insurance renewal premium.
An engine is one of the most important parts of a vehicle. However, a comprehensive insurance plan does not cover it. The Engine Protection cover protects the engine from damages by oil leakage or water ingress. It covers the gearbox parts, engine parts, and differential parts.
A Pay as you drive car insurance plan is an additional coverage to a comprehensive insurance policy. It allows policyholders to reduce their own damage premium based on kilometres driven in a policy tenure. This add-on is ideal for individuals who drive occasionally or own more than one 4 wheeler.
Sometimes, a bunch of unforeseen expenses can drain all your savings. Consumables Cover offers coverage for damages to the consumables of the insured 4 wheeler during any unforeseen event. Consumables include nuts and bolts, screws, AC gas, washers, lubricants, grease, bearings, clips, fuel filter, etc.
Losing or misplacing car keys is a common experience for many individuals. It can be harrowing without a Key and Lock Protect cover under your car policy. With this add-on, the insurer covers the costs of replacing and repairing keys under key protection cover.
Daily allowance add-on comes to the rescue when your vehicle is being repaired in the garage after an accident. Under this add-on, the insurer provides a daily travel allowance if the damaged four wheeler is in the garage for more than 3 days.
The personal accident cover compensates, compensates if the owner-driver suffers injuries, permanent/partial disability or death in an accident. It is included in comprehensive insurance by default. But if you have only third-party insurance, you will have to purchase it as an add-on.
Additionally, one can buy this cover for co-passengers based on the seating capacity of the 4 wheeler. However, the coverage amount is set in advance in this case.
The Roadside Assistance (RSA) cover is the emergency helpline service provided by the insurance provider. Under this cover, the insurer provides you with assistance in case of a breakdown or other failures. Your insurance company sends a mechanic to your location to fix the damage to your four wheeler. Since insurers do not count Roadside assistance coverage as a claim, it will not affect your NCB
Under the Return to invoice add-on cover,the insurer covers your 4 wheeler's original invoice amount in the event of theft or total loss. This includes the ex-showroom price, road tax, and first-time registration charges.
With Personal possession add-on cover, you get the coverage if your personal possessions get damaged in an unfortunate event or stolen when your four-wheeler is parked in authorised parking. The coverage amount is limited and varies from insurer to insurer.
A comprehensive plan does not cover tyre or tube damages in an unfortunate accident. However, a tyre protection cover offers coverage for accidental damages to tyres or tubes.
Under this add-on, you get coverage in case any of the drivers or passengers get injured in the accident. The insurer will provide financial aid for medical expenses.
Here is the list of car insurance companies in India including their claim settlement ratio and the number of network garages they cover:
| Car Insurers | Network Garages | Claim Settlement Ratio | |
| Bajaj Allianz Car Insurance | 4000 | 98.5% | |
| Chola MS Car Insurance | 8300 | 96% | |
| Digit Car Insurance | Repair Anywhere | 96% | |
| Future Generali Car Insurance | 3500 | 96.3% | |
| HDFC ERGO Car Insurance | 8200 | 99% | |
| ICICI Lombard Car Insurance | 5900 | 96.75% | |
| IFFCO Tokio Car Insurance | 4300 | 95.8% | |
| Liberty Car Insurance | 4500 | 98% | |
| Magma HDI Car Insurance | 4000 | 96.6% | |
| National Car Insurance | 3100 | 93% | |
| New India Assurance Car Insurance | 3000 | 95% | |
| Oriental Car Insurance | 3100 | 94% | |
| Raheja QBE Car Insurance | 1300 | 92% | |
| Reliance Car Insurance | 8200 | 98% | |
| Royal Sundaram Car Insurance | 3300 | 98.6% | |
| SBI Car Insurance | 16000 | 100% | |
| Shriram Car Insurance | 2000 | 96% | |
| Tata AIG Car Insurance | 7500 | N/A | |
| United India Car Insurance | 3100 | 95% | |
| Universal Sompo Car Insurance | 3500 | 96% | |
| Zuno Car Insurance | 1500 | 98% | |
| Zurich Kotak Car Insurance (formerly known as Kotak Mahindra) | 2327 | 98% |
Choosing the right car insurance policy requires understanding various factors. These include coverage types, vehicle's age/make/model, IDV, inclusions, exclusions, add-ons, deductibles, discounts, etc. Here are some useful tips that will help you select the right four-wheeler insurance policy:
Third-party insurance is sufficient to save you from paying for traffic challan. However, you should opt for comprehensive insurance for exhaustive protection.
Always compare car insurance online to check the coverage and benefits offered by different insurers. Choose the plan that best fits your insurance needs and budget.
You should select an IDV that aligns with the market value of your 4 wheeler . While a lower IDV can reduce your policy premium, it may result in higher out-of-pocket expenses during claim settlement. To choose a suitable IDV, you can use an online IDV calculator.
Add-ons are additional covers that help you extend your four-wheeler insurance cover. Car insurance companies offer various add-ons, which you can buy as per your budget and coverage requirements. However, you should choose them wisely to get adequate benefits without hefty policy premiums.
Before purchasing car insurance, you must research the insurer, particularly its CSR (Claim Settlement Ratio). A higher CSR indicates more claims are settled in a year, while a lower CSR means fewer settled claims. Hence, you must always choose an insurer with a higher CSR.
Your insurer's support team should be available 24x7 to solve your queries and provide support. Additionally, check if your insurer offers cashless repairs so you can get your 4 wheeler repaired at any network garage without paying out of pocket.
Buying or renewing car insurance online or offline depends on your preferences. The offline method is a tedious process involving a lot of manual paperwork. It involves purchasing or renewing a policy via insurance agents or by visiting the insurer’s office.
However, the online method is extremely convenient and saves time. You can compare car insurance quotes from multiple insurers, which ensures you get the best coverage at the best price. You can visit the insurer's website or an aggregator like Policybazaar.com to buy car insurance online easily.
The table below states the major differences between buying car insurance online and offline.
| Categories | Buying Car Insurance Online | Buying Car Insurance Offline |
| Buying Process | Can be purchased online from the insurer’s official website or Policybazaar.com. | Requires physical visit to the insurer’s office or by connecting with the agent. |
| Insurance Premium | Lower premiums because of the absence of agents. | Higher premiums due to higher operational costs and involvement of agents. |
| Convenience | More convenient since it only requires a smartphone and a good internet connection. | Less convenient as customers need to meet with the insurance agent. |
| Transparency | More transparent as there is no agent or intermediary’s role. | Less transparency since agents are involved. |
| Customer Support | Easy to connect with the customer support team 24x7 via emails and calls. | Policyholders can contact the customer support team or the agent during office hours. |
| Paperwork | Minimum to zero paperwork. | May require a lot of paperwork. |
| Renewal Process | Easy to renew as the policyholder’s details are auto-saved by the insurer. | The car insurance renewal process is cumbersome and takes time. |
Car insurance price is decided based on several factors. You can easily check your insurance premium using an online car insurance premium calculator. However, the insurance provider takes into consideration the following parameters before fixing the auto insurance price
The car insurance price is decided based on the type of coverage you opt for. Basically, third-party insurance carries the lowest premium as it only covers third-party damages. The premium becomes higher if you purchase own damage or comprehensive insurance.
Both third-party and comprehensive car insurance policies include PA cover, with a coverage of up to Rs. 15 Lakh. You can purchase this cover by paying a nominal extra premium.
IDV, the current market value of the insured four wheeler, significantly affects car insurance premiums. It is the maximum amount a policyholder receives in case of a total loss. The higher the IDV, the higher its insurance premium.
4 wheeler’s make and model significantly affects its insurance premium. Typically, insuring high-end models costs more than base models because of the higher costs of part repair or replacement.
Repairing diesel or CNG cars is more expensive than petrol variants. As a result, petrol car insurance premiums are lower than for other fuel types.
The geographical location of the insured 4 wheeler also impacts the final cost of its policy premium. Usually, the premium is higher in metropolitan cities because of denser traffic and, consequently, higher chances of accidental damage.
The manufacturing year of the four wheeler is also considered when deciding the insurance premiums. Insuring newly launched four-wheelers can be expensive since their spare parts might not be available in the market.
Enhancing the policy coverage with an add-on cover will increase the premium. However, these add-ons can only be purchased with comprehensive insurance.
If the policyholder has not filed claims during the policy term, the insurer provides a No Claim Bonus. This reward can be used to reduce the policy premium at the time of car insurance renewal.
The IRDAI decides the third-party insurance rates for all 4 wheelers based on their engine capacity. Here are two ways to calculate the own damage premium for a new car:
The easiest method to calculate the insurance amount for a new car is to use a Car Insurance Premium Calculator. Simply visit the calculator on Policybazaar.com and enter four-wheeler details like make, model, variant, and ex-showroom price. The calculator will calculate the estimated new car insurance price along with the IDV.
An OD insurance premium for a new 4 wheeler can also be calculated by using the following formula:
OD Premium = IDV * Premium Rate (decided by the insurer) + Add-Ons - Discount & benefits (no claim bonus, theft discount, etc.)
IDV or the Insured Declared Value can be calculated by using the following formula:
Insured Declared Value = (Current market value - the depreciation value) + (Cost of accessories - their depreciation value)
Lowering your car insurance premium without compromising coverage requires understanding the factors that affect policy costs. Below are some helpful tips you can follow to save on your premium while ensuring optimum coverage.
Car insurance premium rates vary based on the coverage options and benefits the insurer offers. Hence, you should compare car insurance policies online to get your policy at a cost-effective premium. Doing this lets you choose the one that best meets your coverage requirements and suits your budget.
Another way to save on your car insurance premium is to install an anti-theft device in your four-wheeler. However, it should be ARAI (Automotive Research Association of India) certified.
An anti-theft device enhances your 4 wheeler’s security and minimises its theft chances. Moreover, insurers provide up to 2.5% or Rs. 500 discount on your car insurance premium, making it more affordable.
Every modification done to your four-wheeler increases its value and, in turn, its insurance premium. Hence, you must not make any unnecessary modifications to avoid high car insurance premiums.
You should take some time to identify the add-on covers tailored to your vehicle's type and requirements. It ensures optimum coverage and helps lower your overall insurance premium. You may consider some beneficial add-ons such as zero deprecation, roadside assistance, and engine protection for a great driving experience.
You should not make claims for minor damages since they are not expensive to repair. Paying out-of-pocket for repairing such damages will keep the NCB discount valid for your next car insurance renewal, ultimately lowering your policy premium.
Pay as you drive or pay as you go insurance is usage-based car insurance. Under this, you pay the policy premium only for the number of kilometres you drive. Hence, if you don't drive frequently or long distances, you should opt for PAYD car insurance to save on your policy premium.
If you renew car insurance after its expiry, it leads to a policy lapse. It, in turn, increases the renewal premium and voids NCB. So, you should get your car insurance renewal on time to avoid hefty premium amounts.
Buying car insurance online from the insurer’s website or aggregators like Policybazaar.com comes with the following benefits.
You can get motor insurance quotes instantly by just entering your registration number online. Visit Policybazaar.com and get instant quotes from over 20 insurers online.
Purchasing 4 wheeler insurance is more affordable online than offline. Insurers save on operational costs online and, thus, charge lower premiums.
You can easily compare car insurance plans from different insurers online, which is impossible offline. Policybazaar.com allows you to compare plans from multiple insurers so you can buy the right plan that fits your needs and budget.
Buying car insurance online is faster and extremely convenient. You don’t have to meet with an insurance agent or visit the insurer’s office to buy the policy. Just enter the required details, pick the most suitable plan, and your policy will be issued in a few minutes.
You can buy car insurance online with minimal or zero paperwork. You don’t need to fill out several physical forms to purchase the policy. Instead, you just need to fill out a short online form and pay the premium to get the policy issued.
You can also go through an insurer’s online customer reviews, claim settlement ratio and incurred claim ratio to check its credibility.
To buy car insurance online from Policybazaar.com, follow the steps given below:
You do not need any documentation or paperwork when you purchase or renew car insurance online from Policybazaar.com. However, there are some details that you will need to have handy during the process. These include:
Car insurance policies have a validity and need to be renewed for continued coverage. Here are some major benefits of online car insurance renewal:
When you renew car insurance online, you can easily compare plans offered by multiple insurers. This will help you understand the additional services available, such as self-video claims, a free pick-up and drop facility, cashless assurance, and 3-day repair assistance.
You can easily modify the coverage of your car insurance policy during renewal by adding or removing add-ons. However, before tailoring your policy with an add-on cover, remember that your insurance premium depends on it.
If you are dissatisfied with your current insurer or want to enhance your policy coverage, you can switch car insurer at the time of renewal. Moreover, if you find another insurer offering better features, then you can do so from the comfort of your home.
Secured payment gateways make car insurance renewal a safe and transparent process. Premium payment can easily be done using credit cards/debit cards/and UPI.
Policybazaar.com offers quick and easy car insurance renewal online. Follow these simple steps to get an instant quote in just a few minutes:
You will receive the policy document for your renewed car insurance on your registered email ID. You can also download a copy of the policy document and get a printout anytime you want.
Here are the top 4 reasons why you must renew your expired car insurance policy now:
Driving an uninsured 4 wheeler is a punishable offence in India. If caught without a valid insurance policy, you could incur fines of up to Rs. 4,000 and face imprisonment
If your four-wheeler insurance has expired, you do not get policy coverage and cannot raise a claim. Even if you raise a claim with an expired policy, your insurer will reject such a claim, and you will have to bear the repair costs from your pocket.
If you do not renew your expired car policy within 90 days, you will lose your No Claim Bonus benefit.
A four-wheeler with an expired policy may have to undergo a mandatory inspection before renewal. If the insurer finds it ill-maintained and in bad shape, it may lead to a higher premium.
It is critical to understand the car insurance claim process, as your insurer can reject your claim for many reasons. Follow the below-mentioned steps to raise a valid car insurance claim conveniently:
Step 1: Raise a claim request: Immediately share details of the accident with your insurer after the accident occurs. Make sure you document and share photographic evidence to support your case.
Step 2: Damage Assessment: After the claim registration, the insurer sends a surveyor for damages evaluation. Now, you will need to keep the required documents handy for claim verification.
Step 3: Repair: Once the inspection is complete, you can send your 4 wheeler to a network garage for repairs.
Step 4: Claim Settlement: With a cashless claim, the insurer will directly settle the repair bills with the network garage. However, for a reimbursement claim, you will need to pay the bills first and then ask your insurer for reimbursement.
Whether it is theft, an accident, or third party damages, the insurance company requires several documents at the time of claim. Mentioned below is the list of different documents that you would require when registering a claim:
Here are some essential tips that will help you avoid car insurance claim rejections:
Inform your insurer as soon as you make any modification to your four-wheeler. If you fail to do so and the insurer learns about it during the claim process, they may reject it.
If you forget to renew your policy before the expiry date and raise a claim after that, your insurer will reject that particular claim. Therefore, make sure to renew your car insurance policy before the expiry date.
Your insurance provider may reject your claim if you don't have any of the mandatory documents. Thus, you must keep all the relevant documents handy at the time of raising a claim.
Read your policy terms and conditions thoroughly at the time of policy purchase for a hassle-free claim settlement and avoid any claim rejections.
A motor insurance claim can also get rejected if the driver was found without a valid licence at the time of the accident. Thus, ensure that you have a valid driving licence while driving on Indian roads.
If you mistakenly declare an incorrect NCB when buying or renewing your policy, the insurer may reject any claims you make. Therefore, you must declare the right NCB when purchasing a policy.
When you purchase car insurance online, your insurer sends your policy documents to your registered address. Moreover, you also receive a digital copy of your policy on your email address. However, if you lose your policy documents, you can download your policy copy from Policybazaar Insurance Brokers Private Limited. Here are the steps:
Check out some of the commonly-used car insurance terminologies:
IDV or Insured Declared Value is the current market value of the insured four-wheeler. If it suffers total loss, IDV is the compensation that the insured person will get from the insurer.
Premium is the amount the vehicle owner pays to the insurer in exchange for financial protection of the four-wheeler.
No Claim Bonus or NCB is a discount on the motor insurance renewal premium. This reward is given by the insurer to the policyholder for safe driving and not raising any claims in the previous policy year.
Zero depreciation is an add-on cover in car insurance that prevents the depreciation deduction on the four-wheeler and its parts during claims.
Damages from an accident, natural calamity, fire, man-made disaster or burglary.
Personal accident cover provides compensation to the owner-driver in case he/she becomes disabled or dies in an accident.
These claims are filed when the insured 4 wheeler is taken for repair at a network garage authorized by your insurer.
A voluntary deductible is the amount the policyholder chooses to pay out of pocket when making a claim.
Ans: New car insurance is always expensive since the IDV is at its highest at the time of policy purchase. A four-wheeler’s value depreciates with age, bringing down its IDV. Moreover, most people buy multiple add-ons, which also increases their premium.
Ans: You can reduce the policy premium of your 4 wheeler insurance by:
Ans: No. Personal Accident (PA) cover in car insurance is mandatory according to Indian motor laws.
Ans: Buying or renewing car insurance online takes only a few minutes. All you need to do is log in to Policybazaar.com, enter your 4 wheeler details and contact information, and pay the premium for the chosen plan to get your policy issued instantly.
Ans: Yes. Both offline and online car insurance policies are the same. The only difference is that your online policy is sent to your registered email ID, while the offline policy is sent to your home through the post.
On the other hand, non-cashless/reimbursement claims are raised when your four-wheeler gets repaired at a non-network garage. In this case, you need to pay the entire repair bill and raise a reimbursement request with your insurer.
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Read more#Rs 2094/- per annum is the price for third-party motor insurance for private cars (non-commercial) of not more than 1000cc
*Savings are based on the comparison between the highest and the lowest premium for own damage cover (excluding add-on covers) provided by different insurance companies for the same vehicle with the same IDV and same NCB. Actual time for transaction may vary subject to additional data requirements and operational processes.
+Savings are based on the maximum discount on own damage premium as offered by our insurer partners.
##Claim Assurance Program: Pick-up and drop facility available in 1400+ select network garages. On-ground workshop team available in select workshops. Repair warranty on parts at the sole discretion of insurance companies. Dedicated Claims Manager. 24x7 Claim Assistance.
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