Skip to main content

Motor Insurance - Think Street Smart

Motor insurance is not just a legal requirement. Read the fine print before signing on the dotted lines to save money
AT A TIME when motown customers are facing heat over high fuel prices and soaring interest rates, shouldn’t they strive to extract every penny they spend on their automobile purchase? Valid question, you may say, but most customers choose to ignore an important component while purchasing a vehicle — motor insurance. They just consider it a legal requirement without which they can’t bring their new vehicle on road. Indeed, motor insurance is a necessity which covers you against damage to your own vehicle and damage to the third party.

Broadly, there are two types of auto insurance —
1) Comprehensive policy and
2) Third party insurance.

1) Comprehensive policy

In comprehensive insurance, you get full cover for every possible damage, including dents, technical problems, repair, accidents and even for car theft.

To make sure that an individual gets the best deal while buying an insurance policy, he/ she should make sure that the policy is a comprehensive one. The policy should have cover for the loss or damage to the vehicle or accessories due to natural calamities such as fire, explosion, self-ignition or lightning, earthquake, flood, typhoon, hurricane, storm, tempest, inundation, cyclone, hailstorm, frost landslide, rockslide, burglary, theft, riot, strike, malicious acts, accident by external means, terrorist activity, any damage in transit by road, rail, inland waterway, lift, elevator or air and others, head, motor insurance of ICICI Lombard. Too exhaustive a list, but you never know when an emergency would strike.

2) Third party insurance

In third party insurance, your cover is limited to the claims payable to the third party in case of an accident. Incidentally, third-party insurance is the only insurance compulsory under the law. The other type of insurance is called ‘third party theft’ insurance. Here the premium is less than comprehensive cover and you get insured for the theft of the vehicle. But make no mistake here. Consumers opting for this type of insurance don’t get any cover for repairs and other damages.

Consumers should also keep in mind that third party insurance is mainly offered by government-owned companies such as General Insurance, New India Assurance, United India Insurance and Oriental Insurance. Though private companies such as Iffco Tokyo, Baja Allianz, ICICI Lombard, Royal Sundaram, Tata AIG and others also offer third party insurance, they generally don’t push these since they are not very lucrative for them. Though none of the policies cover medical expenses, the Motor Insurance Tribunal covers medical claims on account of loss of salary income due to hospitalisation or any other disability. There exists a personal accident cover for individual owners under optional accident cover.

Now, once you have decided on which type of insurance you plan to take, you should be clear on some issues to enable you to take informed decisions. Though almost every dealer from where you buy your vehicle offers you insurance at the showroom only, you have the right to choose your own insurance company. You may be able to save some money by choosing a company different from your dealer as now different companies offer different rates and discounts with the de-tariff regime in place.

In this regime, insurance companies have the option to offer you rates lower than other players. Of course, you just don’t have to jump the gun. Check various companies for the rates and discounts and then negotiate with your dealer. If you have a good history — like your vehicle has had no accident in the past or if you haven’t claimed bonus in the previous years — then the auto insurance companies will give you further special rates. The region where the vehicle is bought also plays a role in deciding premiums as some locations have higher risk profiles.

Continuity of your vehicle insurance is also important. The gap in your insurance policy will not go well with insurance companies and you may have to shell out more premium. Also, always check if you have cashless facility and make sure that your nearby workshop or garage is covered under it. The cashless option will save you from the hassle of tedious claim reimbursement procedure.

Another must is that you should never take the agents’ word for granted and ensure you get the best deal. Incidentally, companies such as ICICI Lombard and Bajaj Allianz also offer interest-free instalments for the premium payment if you are paying online.

So the next time you buy your dream car, don’t forget to look into the finer points of insurance.

Popular posts from this blog

Post Office Deposits Interest Rates

Best SIP Funds to Invest Online   SIPs are Best Investments when Stock Market is high volatile. Invest in Best Mutual Fund SIPs and get good returns over a period of time. Know Top SIP Funds to Invest Save Tax Get Rich For further information on Top SIP Mutual Funds contact  Save Tax Get Rich on 94 8300 8300 OR You can write to us at Invest [at] SaveTaxGetRich [dot] Com

How Tax Deducted at Source (TDS) works?

    THE tax season is here. And if you are an employee you can't blame your employer for deducting large chunks of money from your salary towards tax deducted at source ( TDS ), which he is legally obliged to do. Your bank will also deduct some percentage from your FD interest of Rs 10,000 or more towards TDS! So what is this TDS all about? How is it computed? Are there any changes this year? Read on... What is TDS? TDS reduces your taxable income and could even provide tax relief! The TDS collections account for 40 percent of the total taxes collected in the country. As the name suggests TDS is the amount of tax that is deducted at source in certain types of income . The TDS thus collected is deposited in the Government treasury within a specified time. How is it computed? Some of the types of income where TDS is applicable include salary, interest, rental fee, interest on securities, insurance commission, dividends from shares and UTI/Mutual Funds, commission and brokerage

Modern day balanced mutual fund approach

Buy Gold Mutual Funds Invest Mutual Funds Online Download Tax Saving Mutual Fund Application Forms Call 0 94 8300 8300 (India)   In reality, most balanced funds have a strong tilt towards equity instead of a mix of equity and debt THERE are various types of mutual funds available to investors with specific features. Often investors have a particular idea about a specific type of funds in terms of their features and risks, but that is not what is actually available. Therefore, it is necessary for an investor to understand the actual position before picking up a fund. This requires some work on the part of the investor. One example can be the situation with balanced funds. Name is not representative: One of the first things that an investor has to understand is that the name of the fund is often not representative of its investment pattern. The name often represents only the aim of the fund, and not what it actually is.

ELSS Tax Saver

ELSS Stands for Equity Linked Savings Scheme.   ELSS Fund are mutual funds with 3 years of lock in period and offer income tax benefit under section 80C. They are open ended to purchase. Not all Mutual fund Investments are eligible for tax exception. List of Tax Saving Mutual Funds   Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.   Invest Tax Saving Mutual Funds Online Tax Saving Mutual Funds Online These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving)   Download Tax Saving Mutual Fund Application Forms from all AMCs Download Tax Saving Mutual Fund Applications   These Application Forms can be used for buying regular mutual funds also   Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds ) HDFC TaxSaver ICICI Prudential Tax Plan DSP BlackRock Tax Saver Fund Birla Sun Life Tax Relief '96 Reliance Tax Saver (ELSS) Fund IDF

Should you invest in tax-free infra bonds?

THOSE looking to save tax should take note of the latest buzz in the debt markets. Power Finance Corporation ( PFC ) and Housing Urban Development Corporation (Hudco) have launched bonds that will help you save more tax than your regular infrastructure bonds. Soon, IRFC and NHAI are likely to follow suit with similar bonds. KP Jeewan, general manager, debt markets, Karvy Stock Broking, says: "The coupon in these bonds are completely tax-free and those in the highest tax bracket can expect an effective yield of 10.75 per cent, compared to the 9.5 per cent a 10-year public sector bond would offer." The PFC and Hudco offerings are of 10- and 15-year tenures, with coupon rates of 7.5 and 7.75 per cent, respectively. Unlike other regular tax-free infra bonds, the tax benefits in these bonds are not capped at ` 20,000. Even besides these tax free bonds, those in the highest tax bracket have had plenty of opportunities to invest in tax saving infrastructure bonds under 80 CCF i
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now