The Motor Vehicles Act, 1988 mandates every vehicle to have at least a third-party insurance plan to be on-road legally in India.
However, having only third-party car insurance cover may not suffice as it won’t provide coverage in the case of own damages. Now, this can be especially problematic when it comes to premium or luxury cars. It is indispensable, especially for luxury cars, considering the price of spare parts and repairing costs, to opt for a comprehensive insurance policy. For instance, the servicing charge of Mercedes Benz luxury cars in India can be Rs.40,000 and above, depending on the make and model of the car. Thus, luxury car owners should consider buying a comprehensive car insurance plan that offers optimum financial coverage against substantial third-party as well as own damage liability.
However, before that, luxury car owners also need to factor in certain aspects of insurance plans.
Luxury Car Insurance Coverages That You Must Own
Since premium luxury cars guarantee comfort and state-of-the-art features, they cost a bomb. Least to say, the maintenance and repairing costs of them are also exorbitant. Thus, if you do not want to cough up a huge amount in case your luxury car gets damaged in an accident, a comprehensive car insurance plan is a must.
Following are the pointers which help you choose the best one, irrespective of the car brand you own:
1. Third-party or Comprehensive Plans for Premium Cars?
As mentioned earlier, people can choose between a basic third-party and comprehensive car insurance plan.
A third-party liability insurance policy covers the following:
- Liability arising due to physical injuries or the death of a third party
- Damages caused to third-party property or vehicle
On the other hand, if you buy comprehensive car insurance plan, you are financially covered against the following:
- Damages to your insured car due to accidents, fire, natural disasters.
- The comprehensive insurance will compensate coverages caused through theft
- Liabilities arising from personal injuries or death
- Financial protection over yourself & the third-party individual
- Provides extensive additional benefits with add-on covers.
Since the comprehensive coverage provides extensive benefits, it will naturally provide better safety for your premium car. Premium car owners must choose comprehensive car insurance to maintain the posh look of it and enjoy its luxury without compromising on any.
2. Choose Add-ons to Your Comprehensive Plan for Better Safety
One of the best benefits of a comprehensive plan is that you do not need to opt for an own damage car insurance separately, because own damage insurance comes as a part of comprehensive plan. Plus, almost all leading insurers offer car insurance add-ons that you can buy and customise your comprehensive insurance plan. These add-ons strengthen the insured car’s coverage level and enhance the financial security of existing insurance plans.
The following are some of the most common add-ons advised for luxury car owners
- Zero Depreciation Cover
Be it a high-end car or a hatchback, a car depreciates over the years. Moreover, if your car is more than 5 years, it is wiser to avail a zero-depreciation cover.
- Return to Invoice Cover
This add-on cover allows you to claim the invoice value of the insured car on account of theft or damage beyond repair.
- Tyre Protect Cover
The tyre price of premium cars is highly expensive. For instance, a Pirelli tyre for a Lamborghini Aventador costs around Rs.54,701. Thus, having this add-on for your luxury car tyres is highly recommended to keep them financially protected.
- Engine and Gearbox Protection Cover
This add-on covers the cost incurred due to engine and gearbox damages in any circumstance, including accidents.
Besides, you can also opt for Consumable Cover and Passenger Cover, etc.
3. Know What’s Not Covered in Your Insurance Plan
Even though you buy a comprehensive car insurance plan, it does not cover all the damages or applies to certain circumstances. Thus, it is necessary for you to know the exceptions while purchasing one.
Following are the cases where a car insurance policy falls null and void:
- Drunk driving
- Driving without license
- Consequential damages
- Contributory negligence
- Driving without a valid license holder (necessary if you have a learner’s license)
Although you cannot claim the sum assured during such instances, you can leverage the add-ons.
Analyze All About IDV and No-claim Bonus
Insured Declared Value or IDV is the maximum amount you can claim from an insurer if the insured car is damaged. You should know the IDV before purchasing such an insurance plan regardless of your car price or age.
Since the current market value of luxury cars is higher than standard ones, their IDV will also be higher. However, you can also resort to an IDV calculator available on different insurers’ websites.
No-claim bonus or NCB is a reward that insurers offer if you do not make any claim in a policy year. It allows you to avail discounts on premium amounts during plan renewal. As per the recent norm, the NCB in India begins with 20% and goes up to 50% after 5 years.
Therefore, it is crucial to know the IDV and NCB before opting for an insurance plan for your premium vehicle.
Tips to Reduce Your High-end Car’s Insurance Premium
You can follow the tips mentioned below to reduce your car insurance premium:
- Avoid multiple claims
- Increase the deductibles
- Install an anti-theft device in your car
Besides, you should also compare different insurers to ensure the most affordable premium against your car insurance plan. One easy way that helps in calculation of the premiums is through using car insurance premium calculator available online. The premium calculator helps you to compare the plans online, analysing & determining the premium through car insurance premium calculator. Therefore, if you are planning to buy car insurance and looking for smooth premium payment steps, opting for a premium calculator is the best choice.