The zero depreciation cover relieves you from bearing depreciation up to 50% on various parts and paint in the event of any damage to your vehicle due to an accident
The first step towards buying the most suitable car insurance policy is understanding the various terms related to it. This list will help you do that.
IDV - Insured Declared Value is the current market price of your car to your car insurance company. It is also one of the most important factors of calculating your car insurance premium.
NCB - The No Claim Bonus helps you get discounts on car insurance renewal if no claims are made over one or more years. It can be transferred to another car insurance provider as well.
Zero Dep - If you get lower than expected claimed amount from your car insurance provider, consider that depreciation had a role to play in this. The zero depreciation cover relieves you from bearing depreciation up to 50% on various parts and paint in the event of any damage to your vehicle due to an accident.
Deductibles - The deductible is an amount determined by you or the insurance company to pay towards the repair of your vehicle, which is exclusive of the amount paid by your insurance provider. For instance, if your deductible is Rs 10,000, and your repair cost comes to Rs 25,000, you will bear Rs 10,000, and the rest of the amount will be covered by your insurance company. There are two kinds of deductibles: compulsory and voluntary.
Add-on car insurance covers or riders - Basic car insurance policies cover damage to vehicles and bodily injuries. However, with add-on covers or riders you can get added protection for yourself and your vehicle. For example, a roadside assistance add-on cover provides towing services in case your car breaks down, even if it's not an accidental damage. This may have not been covered by your basic car insurance policy otherwise.
Personal accident cover - The personal accident motor insurance cover protects you against permanent total disablement and accidental death in the event of an accident in your insured vehicle. Apart from individual accident cover, there is also enhanced accident motor insurance cover or group accident cover which protects other passengers in the car.
Third-party liability cover - This provides protection from any legal obligation arising from the death, disability or bodily injury to the third-party and damage to their property due to your vehicle.
Comprehensive cover - In addition to third party cover, this provides protection for your vehicle against loss or damages from theft, accident and other incidents. This is considered to be the highest form of coverage in motor insurance.
Endorsement - Endorsement is referred to as any change made to your current car insurance policy. These may be changes in vehicle particulars, your communication address or other details. These may be financial or non-financial in nature depending on your request for change.
Exclusions - Exclusions are those risks that are not covered by your car insurance policy. A few examples are normal wear and tear, drinking and driving, driving without a valid driving licence. If you are driving your personal vehicle for commercial purposes, your car insurance policy will not apply as there are different policies for both categories.
The writer is, MD & CEO of COCO by DHFL General Insurance
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