The Motor Vehicles Act, 1988, has made it mandatory for all car owners to buy car insurance. When shopping for it, we must understand the factors affecting the car premium as well as the premium structure. But like all other niches, even the car insurance sector has its fair share of myths that makes it a daunting task for you to categorize fact and fiction clearly. It undoubtedly clouds our judgment.
Here, we walk you through seven of the most popular car insurance myths and debunk them so that you can differentiate between fact and fiction and choose the right insurance plan for your car. Stay hooked!
Myth 1: My old car need not be insured
The myth is completely false. On the contrary, it is mandatory to buy a policy for each and every car, whether old or new. It is true that old car has a low replacement value but they have a higher risk of theft for their parts. Moreover, because of the lack of carefulness; it far easier to steal an old car than a new car.
Myth 2: Red cars are more expensive to insure
This is again a false myth that holds no water. When seeking a Car Insurance Plan, the insurance company asks for details like the model, make, etc. of your car and its color is the least of its concerns. The color picture kicks in only if you are modifying its color to a flashy and sporty design or a vibrant mix of logos.
Myth 3: Motor accidents only covers for accidents where I am innocent
This myth again holds no water. The insurance policy covers all types of accidents of you have a valid driving license. The accident not covered is when you are driving under the influence of alcohol or drugs. A comprehensive car insurance provides you coverage against all kinds of possible damage to your car. The condition that you need to conform to is that your vehicle is being used as per the terms stated in the policy like a personal car should not have been used for business purposes.
Myth 4: Transferring policy to another insurer implies that I will lose my NCB
For the unawares, NCB is the No Claim Bonus incentive that the insurance company gives you as a reward for making no claim during the policy period. It is sufficient enough to lower your premium appreciably and can even accumulate of you have not claimed it.
The myth holds no water as you are eligible to your NCB no matter which insurance provider you opt for provided you have filed for it within 90 days of the expiry of the old policy.
Myth 5: Third-party cover is sufficient for my old car
You need to understand third-party insurance to debunk this myth. Third-party insurance is meant to cover the damages caused to the third-party with whom you got involved in an accident. It does not cover any damage caused to your car. Thus, the age of your car is irrelevant here. It’s the condition of the car that plays the deciding factor. It is always preferable to get even your old car insured to protect against any unforeseen circumstances.
Myth 6: NCB gets transferred to the new owner upon selling your old car
This is a false myth. NCB is given to you as a personal reward for not making any claims. Even if you sell your car; you can get the insurance transferred to the name of the new owner but the NCB rewards remain with you. You can claim it according to rules and enjoy its benefits.
Myth 7: I need a separate policy for my driver
This is also not true. All you need to do is check that the driver has a valid license and then get his name added in the policy. It must be noted that the insurance company does not entertain any claims without a valid driving license. You need not buy any separate policy for the driver.
Car insurance is an important matter and thus it is essential that you shed away the baseless myths and know true facts about car insurance. This would keep both you and your car safe and secure against any future hassles.