All car-owners are familiar with the concept of car insurance in India. These car-owners have a fairly clear idea about what car insurance online plans do cover and don’t cover. However, many car-owners are not aware or don’t clearly understand many car insurance terms. This write-up aims at educating those uninitiated ones by providing a brief glossary of most vital terms associated with motor insurance plans.
IDV or Insured Declared Value
The value of the insured car as determined by the car insurer is considered as the IDV/ Insured Declared Value. The IDV is the maximum coverage amount or Sum Insured that you can claim on your car insurance plan.
Own Damage Premium
The premium that car-owners pay to cover their own vehicles is called OD premium or Own Damage Premium. By paying this premium on vehicle insurance, you can make claims on your car insurance plan if your insured vehicle gets stolen or gets damaged due to natural or man-made calamities. The OD Premium is worked out by cubic capacity, make and model and the zone where your car is registered.
Zero Depreciation Cover
Zero depreciation cover is one of the most popular motor insurance add-on covers. All car insurance companies in India offer this add-on cover along with regular motor insurance policies. Essentially, this add-on cover keeps the depreciated value of specific car parts out of the equation while settling car insurance claims. Armed with a zero depreciation cover along with your car insurance online plan, you can obtain a higher claim amount.
No Claim Bonus
No Claim Bonus or NCB is a discount provided by car insurance companies to policyholders on their car insurance renewal for not making any claim. The NCB keeps increasing up to 50% of a premium over a course of 5 years. However, if you make any claim on your car insurance your NCB will become zero. If you buy a new car you can also transfer your accumulated NCB to your new car.
Third-Party Coverage
Third-Party Coverage is the coverage against financial liabilities to the third party due to death, accidental physical injury or property damage. This type of coverage of car insurance is mandatory as per the Motor Vehicles Act. If your insured car causes any third party death, accidental physical injury or property damage you can stay financially secured because your car insurance provider will compensate the victim financially up to a pre-specified limit.
Personal Accident Coverage
Personal Accident Coverage comes with most car insurance plans. This type of coverage offers protection in case of accidental death and disablement as a result of a road mishap. Permanent Total Disability from a road accident. When you compare car insurance plans for your car, you should opt for a car insurance online plan that comes with personal accident coverage.
After being aware of the crucial car insurance terms, you can now compare car insurance online more efficiently and make an informed choice for your cherished four-wheeler vehicle.
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