Insurance is basically providing for the risk by a company by paying them the premium. Car insurance is basically providing against the accident or any other damage to the body of the car. Sometimes car insurance provides for financial protection against theft or against incidents other than collision. These other incidents are like keying, damage in a natural disaster or colliding with stationary objects. The terms of policies vary. Car insurance has the following features:
- Risks covered under insurance
Car insurance covers the following risks:
- Damage by natural disasters such as floods, earthquake or storms.
- Man-made disasters such as accident, theft or fire.
- Damage caused while in transit.
- Types of policies
The motor insurance can be of two types:
Comprehensive policy- to cover for loss of personal vehicles, there is a comprehensive policy.
Third-party policy- to cover for the third party. It gives insurance to the third party if any accident is caused to them by the personal vehicle.
- Insured value
The insured value of the vehicle depends upon the price that is set by the manufacturer. Also, the depreciation is deducted out of it.
- Premium to be paid
The premium paid is determined by the following factors-
- Type of vehicle such as model, capacity, fuel type, age.
- Accessories on the model
- The place you stay at
- Past claim experience
- The age/ profession of the owner
- No claim bonus
In case, the owner has not claimed anything in the previous year, then he can get discounts in payment of the present premium. This discount goes on increasing if the owner does not claim anything in past years. Also, the discount keeps on increasing with each passing year.
- Save premium
The premium on policy can be saved by installing safety devices, opting higher deductibles or having a membership of any association of automobiles.
- Add on policies
Along with standard policy in order to get more insured from risks, one can buy different other add on policies such as covers for zero depreciation, no claim bonus protection, accidental hospitalization. The cover for unnamed co-passenger can be provided as well.
- Claim option
The insured can have claimed in two ways; one is to get the car repaired from the insurer’s authorized garage and get the cashless claim. In the cashless claim, the payment settlement happens directly between the company and the garage. The other option can be to get the car repaired from the garage of the insured’s personal choice and get a claim later from the company.
- Exclusions from claim
The claim is excluded if:
- It is normal to wear and tears.
- Mechanical breakdown.
- Using a vehicle for a purpose than what it is intended for.
- The driver at the time of the accident does not hold a license.
- The driver was under the influence of drugs or alcohol at the time of the accident.
These are all the features of car insurance and one who does not know about can know a lot through this article. You can also know more about Erie towing program.