Car Insurance Add-on Covers

Car Insurance policies have come into being to protect you from any financial constraints arising out a car accident. Today more than the cost of the vehicle, high amount of money is spent on maintaining the car in a good condition. People don’t spend much time reading policy documents and often end up making a wrong purchase. Hence, it is important for you to know everything about car insurance including the add-ons you can opt along with it. So here is a list of add-on covers you can buy with your comprehensive car insurance policy.

1. No claim bonus protection

No claim bonus is a reward given to the policyholder for one claim free year. If you make a claim in a year, then you lose NCB discount of up to 50% on renewal of your car policy. A single claim made in a year can bring your discount to straight zero. However, having a no claim bonus protection cover allows you to make cup to two claims in a year, without losing your no claim bonus.

2. Roadside assistance

With this cover, you can enjoy benefits such as free towing, free mechanic services change of tyres, refueling and others. In case if you are stuck on a highway or any remote location, the cover provides for free commute and accommodation service.

3. Engine protection

Having this car insurance add-on ensures saves you from bearing the massive engine repair costs. However, this add-on does not provide coverage for damages caused due to hydro lock or driving with a moist engine.

4. Return to invoice

In case of total damage of the vehicle, this cover provides you with the cost mentioned in your invoice; it also covers registration and taxes.

5. Personal accident cover

This add-on provides financial protection to your family in case you die or become partially or permanently disabled due to an accident. With this add-on, you can availa maximum coverage of up to 1 lakh.

6. Daily allowance

You are entitled to receive a certain amount of daily allowance fare, if your car is damaged or stolen. Usually, Rs. 500-Rs. 1000 is given by the company as daily allowance charges. However, you will not receive this benefit if the car is under repair for more than three days or is not under repair at garage falling under the insurer’s network.

7. Personal belongings

If you lose your personal belongings from your vehicle, you can make a claim for the same.

8. Key replacement

In case if the keys of your car are stolen or misplaced, you can claim compensation for the same, if you opt for this add-on.

9. Zero depreciation

Also known as bumper to bumper or nil depreciation cover, this type of add-on provides you with full coverage for you car, negating the depreciation factor. Having this cover ensures you receive the full claim amount without any deduction or depreciation.

Depreciation of the parts is calculated on the following basis:

The depreciation for metal parts is calculated on the following basis:

Consider the below example for better understanding

Arvind’s newly purchased car met with an accident due to which the doors of the car were damaged. But Arvind was in for a shock when he filed a claim for the same as he just received 40% of the claim amount and 60% of the same had to be borne by him. At such time, if Arvind would had a zero-depreciation cover then the company would have covered the total cost without depreciating the value of the doors.