In India, three types of car insurance policies are offered by all the general insurance companies

1. Third – Party Insurance

As per the Motor Vehicles Act, it is mandatory for every car owner to have a 3rd party insurance. This coverage pays for any damage to 3rd party property, vehicle, or person. This cover does not benefit the car owner in any way

2. Own Damage Car Insurance:

When you are involved in an accident then the compensation for your own injuries and your own car damages are also necessary. Thus, Own Damage Car Insurance is optional but it is extremely valuable.

An own damage car insurance policy covers the cost of damages to your car on account of:

1. Natural calamities like floods, earthquakes, hailstorms, fire, cyclone, tempest, lightening, landslide, hurricane, typhoon, etc.
2. Man-made calamities like vandalism, riots & strikes, terrorist attacks, etc
3. Damage to the belongings in the car
4. Theft or malevolent acts.

3. Add-on Insurance Cover

1. Zero depreciation

Zero depreciation or Nil Depreciation or Bumper-to-Bumper Cover is a car insurance add-on. At the time of claims, this add-on puts the liability of paying for depreciated parts of your car on the insurance company, instead of you.

2. 24/7 Roadside Assistance and Towing

This add-on makes sure that the car insurance company makes an arrangement for the policyholder’s car to be towed and help him reach his desired destination, in the case of a car breakdown.

3. Engine Protect Cover

During monsoon, the roads and streets are predominantly water logged. Your car might have an issue if the water enters the engine. Since such engine damages are not covered under your normal comprehensive policy, you definitely need this add-on.

Why protect the engine?

• Most expensive part
• Repairing it can be a real costly affair
• Significant labor and material charges

The add-on shields against engine damage due to:

• Leakage of lubricating oil
• Damage to gear box
• Water ingression
• Hydrostatic lock – When you repeatedly try to start a moist engine, it can cause an engine failure

4. Consumables Cover

The consumables in car insurance are those items that are subject to the constant wear and tear. They are continuously consumed by the car during its life or rendered unfit for further consumption upon dismantling.

This add-on cover compensates the cost of replacing these following consumable items.

• All kinds of lubricants and oils like engine oil, brake oil, radiator coolants, power steering oil, and AC gas
• Vital items like nuts, bolts, screws, washers, grease
• Filters, etc.

In fact, this consumable add-on policy covers every consumable item except fuel.

5. No Claim Bonus Protection

As the name suggests, it is protection add on cover in motor insurance to protect your accumulated discount percentage from going back to zero, even if you lodge a claim.

6. Tyre Protection Cover

Normally, damage to tyres and tubes are covered only if the vehicle has met with an accident resulting in damage to the tyres and/or tubes. The damage to the tyres and tubes without the vehicle meeting with an accident is covered as an add-on.

7. Return to Invoice

Insure your car to 100% of the List price. In case of theft or total damage you will get full reimbursement on the invoice amount of the car.

Normally, for a new vehicle insured for the first time, the Private Car is insured at 95% of its Manufacturer's List Price. This clause will enable you to insure your new car for the full 100% of the List Price. In case of a Total Loss or Theft of the vehicle, the full invoice value of the vehicle, that was insured, will be considered while assessing the loss.