Are you aware of these factors when purchasing a car insurance?

When it comes to purchasing car insurance, plenty of questions will arise. How much do you need, what do you need and how to decipher the jargon? In reality, purchasing a car insurance isn’t hard. All you need to understand is the lingo, know your rights and get the right coverage. The bottom line is, being informed will save your funds.

So if you are looking to purchase an auto insurance for the first time, or go shopping around for a new rate, you will need to be aware of these facts:

The way you use the car determines your car insurance rate:

Will you be using your car to commute on a daily basis or only on weekends? Will you also be using it for side money to drive for Uber? All these factors determine your insurance rates. So when you are shopping for this insurance, ensure the company known how well you use the car. This is because there is a considerable difference between personal use and business use. Your personal policy may not cover business use, especially if something were to happen to your vehicle while on the job. If you are agreeing to purchase a policy, be sure to clarify these points with your agent before agreeing to it. If you must, opt for an additional policy or supplemental coverage.

Be aware of the coverages that come under the insurance

There are plenty of coverages that can be included as a part of the auto insurance policy. In India, there are primarily three types of car insurance. It includes third party liability coverage, collision coverage and comprehensive coverage. Third party liability coverage will provide cover against legal liability to a third party cause when you were at fault. This is legally mandatory under India regulations. Collision coverage protects the insured financially against the damage of their own car. This does not include theft or vandalism. Comprehensive coverage is an extensive cover that includes damage to the car, theft of a vehicle, third party legal liability and personal accident cover. This coverage can further extend by opting for selected add – on. Each type of coverage will have its own cost associated with it. You will need to talk to your insurance agent to help you determine which coverage suits your needs and your budget.

Know your deductibles

As a part of the automobile insurance, you will need to pay a certain part as deductibles. The deductible is the amount you are contractually obligated to pay towards the cost of repairs, injuries and damages that are incurred as a part of a crash. The amount of a deductible is determined by the monthly cost of your auto insurance policy. In other words, if you pay a higher deductible, you will most likely need to pay a lower monthly insurance payment in the event of a collision. This is normally a part of the collision and comprehensive coverage.


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