Term

Meaning

This insurance provides complete protection against damages to your car that can happen without any accident/collision. It covers damages to car due to fire, flood, malicious acts, vandalism, theft and terrorist activity. It offers cover for legal liability to third party. It provides for personal accident cover. It can be extended to cover for engine, accessories etc.
It does not cover wear and tear, breakdown of vehicle, and damage caused by driving when alcohol or drugs have been consumed.

Zero Depreciation Car Insurance Cover

It is an add-on to the insurance policy. If you have zero depreciation car insurance cover and file a claim, the original value of the car will be considered without taking depreciation into account. The terms and conditions vary depending on the insurance company.

No Claim Bonus

No Claim Bonus (NCB) is given as a benefit to a customer at the time of policy renewal if he/she has not made any claims during the year. Basically, the insurance premium reduces. The policy usually has to be renewed within 90 days of the expiry date to avail this feature. It is usually around 20% for the 2nd year and goes up to 50% for the 6th year. If you have minor damages to the car, you might want to not claim for it to get the benefit of the discount which increases each year.

Personal Accident Cover

This is an add-on. It covers permanent disability and death that can happen in road accidents.

Third Party Insurance

This cover provides protection against legal financial liability to the owner of the car. It covers liability that can arise from death, physical injury or loss/damage to property.

IDV

Insured’s Declared Value or IDV is the sum assured value of the insurance policy. It depends on the selling price and depreciation.

Own Damage Premium

Own Damage means damage caused to the car by external events like flood, fire and earthquake or man made disasters. If you pay Own Damage premium, the car is protected against such events. The Own Damage premium depends on the car specifications and climate and geography of the place where you will drive the car. 

Compulsory Deductibles

It is the amount fixed by the insurer that you will have to mandatorily bear when you raise a claim. It depends on the car specifications and the risk involved. Such deductibles are to ensure that frivolous or false claims are not made.

Voluntary Excess

An insurance cover provides a sum assured. Mostly there is a compulsory deductible. The customer can opt to pay a voluntary deductible when a claim arises. This excess amount that is taken care of by the insured is called voluntary excess or voluntary deductible. For example, if the claim is Rs. 5000 and the compulsory deductible is Rs. 500. The total claim payable by the insurer is Rs. 4500. If the customer decides to have a voluntary excess of Rs. 1500, the total claim will be Rs. 3000. Since the customer is voluntarily bearing part of the loss, the insurance company gives a discount.

Roadside Assistance

Many insurers provide roadside assistance as an add-on to the vehicle insurance policy. It protects you against hassles when you face a car breakdown. Different insurers provide different facilities such as –

• Provision for battery and engine breakdown
• ​Flat tyre
• Towing
• Fuel provision
• Misplaced keys
• Technician to help through minor repairs
• Alternate transportation
• Accommodation if you are out of town
• Message to loved ones in case of delay