Insurance purchase is not a decision to be made at the advice of your friends, peer or even your auto dealer. It needs to be a thoughtful decision as it impacts the financial liability that you will bear in the future. If you end up buying just any policy that does not meet your requirement, then such insurance coverage does not offer any real benefits. Instead, if you opt for a policy with thorough research can help you pick one wisely. While doing that, there can be a blur of fact and fiction. While the reality lies deep benefit the myth, the myth is what the majority choose to believe. This article aims to debunk some of these myths that you need to stay wary when buying a vehicle insurance online.
- Old cars do not require motor insurance coverage
The myth might be true to believe but in reality, it is completely untrue. The Motor Vehicles Act of 1988 makes it mandatory for all vehicle owners to have an insurance cover. So, all vehicle owners need to purchase their polices, i.e., private and commercial vehicle insurance online.
- Motor insurance plans only cover when the insured is not at fault
The reality is that the coverage of a motor insurance policy is based on the type of insurance cover. There are two broad categories of insurance plans—third-party plans or comprehensive covers. A third-party policy offers financial protection when a third person is injured, or their property suffers damages due to your fault. On the other hand, a comprehensive policy while providing third-party coverage also provides for compensation for any damages to your vehicle even with no fault of yours. Thus, vehicle insurance plans do not offer a limited coverage only when you are not at fault, but instead even provide protection when the accident occurs due to policyholder’s negligence.
- On transferring the policy, you lose out NCB benefits
No-claim bonus or NCB is a renewal benefit offered by the insurance companies when no claims are made during a policy tenure. Such renewal benefit is linked to the policyholder and not the vehicle. Hence, such accumulated NCB benefits can be transferred to a different insurance company even if you switch your insurer. You can visit the official website of IRDAI for further details.
- The NCB gets transferred to the buyer when you sell your vehicle
As discussed above, your policy’s NCB is liked to you, the policyholder, and not the vehicle. Hence, even in case of sale of your vehicle, the benefits can still be availed on your next insurance cover. Only the third-party coverage is transferred to the new buyer on sale of your car. All other accrued policy benefits remain attached to you. You can visit the official website of IRDAI for further details.
- You can’t change your insurance company
The belief that such a myth has surfaced is the reluctance of many policyholders to change or upgrade to a better insurer. The reason for such unwillingness may be confusing insurance terms and more or less similar polices. However, the reality lies that there is no restriction for you to change your insurance company. Most plans are valid for a tenure of 1 year. At the end, you must reassess your coverage and that’s when you can look to migrate your present insurance coverage to a different insurer that offers similar coverage at affordable premium or higher coverage at the same cost.
These are some myths that you need to stay clear of. Make sure to decide your policy purchase only after carefully analysing your requirements and then deciding its purchase. In this process, a vehicle insurance calculator can come handy to compare policies and its premiums. Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms and conditions, please read sales brochure/policy wording carefully before concluding a sale.