First-time car buyer? Here’s a guide to help you choose a suitable vehicle insurance

For first-time car buyers, there are countless compelling reasons to invest in a vehicle. From the sheer convenience of having personal transportation that adheres to your schedule, to the independence it grants by liberating you from the constraints of public transportation, a car offers the freedom to commute with ease, whether for work or college. A car opens the door to a more vibrant lifestyle, enabling exploration of new places and activities. Additionally, in emergencies, having a car can be vital, ensuring you have a reliable mode of transportation when unexpected situations arise.

Amid the excitement of becoming a first-time car owner, it’s essential to remember one crucial aspect: car insurance. In case of any mishappening to the car, required financial protection is available through an appropriate car insurance. This article will explore several key considerations you should keep in mind before buying car insurance.

Here are some tips to help you make an informed decision and save money on your premium.

⦁ Understand the types of car insurance coverage

Car manufacturers, often called OEMs (Original Equipment Manufacturers), are keeping pace with changing trends and lifestyles by introducing incredible innovative technologies. At the same time car insurance has also evolved from being a one-size-fits-all product. It’s no longer just a necessary expense; it has become a reflection of your unique style and preferences. Before you decide on your insurance policy, it’s essential to understand that there are various types of coverage available, each with its own advantages and costs.

It’s now simpler than ever to customise your insurance to align with your choices and preferences. You can do this through Add-On Covers, which provide protection for the cutting-edge features of your vehicle, ensuring that your high-tech additions are fully safeguarded.

The most common types of car insurance coverage are:

⦁ Third-party liability: This covers the damage or injury you cause to other people or their property in an accident. This is mandatory by law in India.

⦁ Personal accident: This covers the compensation for death or disability of the driver or owner of the car in an accident. This is also mandatory by law in India.

⦁ Comprehensive: This covers the damage to your car due to natural or man-made causes, such as fire, flood, earthquake, vandalism, riot, etc. including any third-party liability.

Add-On Covers:

a. EMI Insurance: Safeguards your car loan from unexpected events like accidents or disability.

b. Pay as You Drive: Tailors coverage to your driving habits, saving you money by paying only for what you need.

c. Engine Protect: Shields against high repair costs from engine damage.

d. Consumables Cover: Covers essential consumables for hassle-free maintenance.

e. Key Protect: Covers the cost of replacing lost or stolen keys.

f. Return to Invoice (RTI) Cover: Ensures you receive the original invoice price in case of theft or total loss.

g. Zero Depreciation: Guarantees full car value without depreciation deduction in claims.

h. Roadside Assistance: Provides emergency services for breakdowns or accidents.

⦁ Comparing quotes and reading the policy document

When it comes to purchasing your first car insurance policy, it’s like shopping for the perfect outfit. Similar to how you wouldn’t settle for the first clothing item you see, don’t rush into choosing the initial insurance quote that comes your way. Request quotes from multiple insurance companies, much like trying on different outfits to find the one that suits your style. Remember, the cheapest option may seem appealing, but it’s crucial to ensure you obtain comprehensive coverage tailored to your specific needs. Think of it as adding the right accessories to complete your outfit; consider the various add-on options available to customise your coverage for that perfect fit. Before you make your final decision, read the policy document with care. Think of it as the instruction manual for your outfit, explaining what’s included, what’s not (the exclusions), and the potential costs you might incur in case of a claim (the deductibles). Verify that your personal and car information is accurate.

If you have any questions or concerns about the policy, regard the insurer or advisor as your dedicated consultant, poised to aid you in the selection of the appropriate policy, similar to how a consultant aids you in making a well-informed choice. Lastly, learn how to renew your policy before it expires to maintain uninterrupted protection on the road.

⦁ Keep your policy handy and know how to file a claim

After buying a car insurance policy, you should keep a copy of it handy in your car or on your phone. You should also know how to file a claim in case of an accident or damage to your car.

You should follow these steps to file a claim:

⦁ Inform your insurer as soon as possible after the incident.

⦁ Register your claim online or offline by providing details of the incident and your policy number.

⦁ Take photos of the damage and collect evidence such as FIR, witness statements, etc.

⦁ Get your car repaired at authorised network garage as per the insurer’s instructions.

⦁ Submit the required documents and bills to the insurer for verification and approval.

⦁ Receive the claim amount or reimbursement as per the policy terms.

Purchasing your first car is an exciting venture, but it’s essential to approach it with the responsibility it deserves. Choosing the right car insurance is a significant step in ensuring your safety, financial security, and peace of mind as a first-time car owner. By following these tips, you can buy the right car insurance policy for your first car.


The author, Rakesh Jain, is CEO, Reliance General Insurance.

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Updated: 13 Nov 2023, 02:06 PM IST

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