Knowledge Centre

Understanding Car Insurance in India

Cars have become integral parts of our life, whether we use it for going on a family trip or using it to go for work. After home, it is the second most prized possession for any individual; therefore, it becomes important for us to ensure its safety with car insurance.  You can buy car insurance or renew your existing car insurance policy online at the convenience of a click, right from the comfort of your home.

It is also mandatory under the Motor Vehicles Act 1988 and the recently passed Motor Vehicles (Amendment) Act 2019 for all the drivers to have valid car insurance at all times while driving. Confused about which type of car insurance suits you the most…. Worry Not

Let’s discuss the three types of car insurance products available

Third Party Liability: The insurance coverage under this includes protection from legal liability due to accidental damages resulting in bodily injury or death of third party or damage caused to the third party property.

Comprehensive Car Insurance: The insurance coverage under this policy includes coverage against third party legal liability

  • loss or damage to your car from natural calamities like fire, lightning, flood, hurricane

  • loss or damage to your car from manmade calamities like theft, riot, strike, damage in transit

  • Further, you may also opt for personal accident cover for owner-driver for a sum insured of Rs 15 lakhs.

Standalone Own Damage Policy: This policy offers the policyholder protection for his car against risks from damage due to natural calamities like fire, lightning, floods, landslide and hurricane and also risks from damage due to manmade events like theft, burglary, any damage during transit from the road, rail and inland waterway.

Recent Regulatory Changes in the Indian Car Insurance Industry

There have been a few regulatory changes that have shaken up the car insurance industry, let us have a look into them in a brief

  • Supreme Court of India has issued a directive stating that any new car purchase on or after September 1, 2018, would have to buy third party liability cover of 3 years duration and compulsory personal accident cover has been increased from Rs 2 lakh to Rs 15 lakh

  • Also according to circular from Insurance Regulatory and Development Authority of India (IRDAI) effective January 1, 2019, personal accident cover has been unbundled from motor insurance.

  • According to a circular from Insurance Regulatory and Development Authority of India (IRDAI), effective September 1, 2019, car insurance companies would be able to offer separate standalone Own Damage cover.

  • Parliament of India has enacted a legislation Motor Vehicle Amendment Act 2019 which has increased fines and penalties traffic offences.

Add On’s of Car Insurance

If you are thinking that after buying comprehensive car insurance, your car is 100% secure against all risks, then it is not so… let's discuss Add-On coverage which provides an extra layer of security to your car.

  • Zero Depreciation: This Add-On helps you get full claim amount without any deduction for depreciation of the parts that have to be replaced.

  • Return to Invoice Cover: Now you can ensure that you get a list price of your car in case of theft or total damage by getting this Add-On

  • Key Protector Cover: In the event of your car keys getting stolen, damaged or misplaced, the insurer will cover repair/replacement of keys which would include labour costs.

  • No Claim Bonus Protection: This Add-On safeguards your accumulated No Claim Bonus even in the event of you making a claim, however, this Add-On is not available for vehicles older than 3 years.

  • Loss of Use: Bearing the cost of daily travel in cabs while your car gets repaired in the garage. With this Add-On, you will be compensated for the cost of travel by the car insurer.

Why HDFC ERGO??

HDFC ERGO is a brand to reckon with when it comes to the general insurance industry in India. The company offers insurance products across categories which include motor, travel, health and home in the retail category and insurance products in property, marine and liability insurance on the corporate side.

  • Over 1 crore+ happy customers

  • Overnight Car repair Services in 13 cities

  • Transparency and seamless claim process

  • Dedicated In house claim settlement and customer support working 24*7

  • Online Buying and Renewal.. Go paperless

  • 6,800+ network garages across the country

Seamless and Easy Claims! Assured

  • Registration and Tracking of claims through the website

  • Regular claim update on the mobile

  • The facility of a preferred mode of claim settlement


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