Smart Start with Car Insurance
Buying car insurance for the first time can feel confusing, especially with so many plans, terms, and providers available in the market. But choosing the right car insurance is just as important as buying the right car. It protects you from financial losses due to accidents, theft, or damage. For first-time buyers, understanding the basics and comparing options can help save money and avoid common mistakes. This article shares essential car insurance tips for beginners to make informed and confident decisions when buying their first policy.
1. Understand the Two Main Types of Car Insurance
There are two primary types of car insurance in India:
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Third-Party Insurance – Mandatory by law; covers damage to other people or property caused by your car.
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Comprehensive Insurance – Includes third-party cover and also protects your car from theft, fire, accidents, and natural disasters.
Tip: Go for comprehensive insurance for better protection, especially if your car is new.
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2. Compare Plans Online Before Buying
Use online platforms or insurance aggregator websites to compare:
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Coverage options
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Premium costs
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Add-ons
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Claim settlement ratio
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Customer reviews
Tip: Don’t choose a plan just because it’s the cheapest—focus on overall value.
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3. Choose the Right Insured Declared Value (IDV)
IDV is the current market value of your car. It affects your premium and claim amount.
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Higher IDV = Higher premium + Higher claim amount
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Lower IDV = Lower premium but reduced coverage
Tip: Don’t understate your car’s IDV to save money—it may reduce your claim payout.
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4. Select Useful Add-On Covers
Some common add-ons include:
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Zero Depreciation Cover
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Roadside Assistance
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Engine Protection
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NCB Protection
Tip: Add-ons increase the premium but provide extra security, especially for new or high-end cars.
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5. Check the Claim Settlement Ratio of Insurer
A company’s Claim Settlement Ratio (CSR) shows how many claims they successfully settle.
Tip: Prefer insurers with a CSR above 90% for reliable claim service.
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6. Don’t Forget the No Claim Bonus (NCB)
If you don’t file any claim in a year, you get a discount (up to 50%) on next year’s premium.
Tip: Even small repairs can be paid out-of-pocket to retain your NCB benefits.
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7. Read the Policy Terms Carefully
Before buying, go through:
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Inclusions and exclusions
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Claim process
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Renewal terms
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Network garage list
Tip: Don’t ignore the fine print. Ask for clarification if anything is unclear.
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8. Choose Long-Term Policies for Peace of Mind
IRDAI allows long-term third-party insurance policies (up to 3 years).
Tip: A long-term policy protects you from premium hikes and ensures continued compliance with legal requirements.
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Conclusion: Start Smart, Drive Safe
First-time buyers should take the time to understand their car insurance options, compare wisely, and invest in suitable coverage. Avoid rushing or picking a plan without research. A well-chosen policy not only meets legal needs but also ensures financial safety and peace of mind. Follow these tips to get the best value and protection from your first car insurance plan.