Owning one’s dream car is more than just transportation. For car enthusiasts, vehicles reflect identity and passion. Significant time and money goes into upgrades, maintenance, and custom details. Relying solely on basic third-party insurance can leave these prized possessions vulnerable.
This is where own damage car insurance becomes essential. It offers comprehensive protection beyond standard policies and safeguards investments in vehicle performance, aesthetics, and personalisation.
With the ‘own damage insurance’, car enthusiasts can pursue their automotive passion without worrying about unexpected repair costs or the devaluation of their cars after accidents. These policies give peace of mind that one’s prized vehicle will be restored to its former glory if anything untoward happens. This blog post explores what makes this specialised protection a must-have for devoted car owners.
What is third-party insurance?
Third-party insurance is an essential and mandatory car insurance under the Motor Vehicles Act 1988. It covers damages or injuries caused by one’s vehicle to a third party, whether a person, property, or another vehicle.
While this policy ensures compliance with legal requirements and protects against liability claims, it does not cover any damage to one’s own vehicle.
Limitations of third-party insurance
Limitations of these policies include the following:
- No coverage for own vehicle: Repairs or replacement of one’s vehicle is not included.
- Minimal customisation: It does not allow add-on or enhancements to suit specific needs.
- Limited scope: Focuses only on third-party liabilities, leaving gaps in insurance coverage.
These limitations can prove costly for car owners. This is where own damage insurance becomes essential. It provides comprehensive protection that goes beyond the standard third-party policies.
Key differences between third-party and own damage car insurance
Key differences between third-party and own-damage car insurance include the following:
| Aspect | Third-party insurance | Own damage insurance |
| Coverage | Covers damages to third parties (person, property, or vehicle). | Covers damages to personal accidents, natural disasters, etc. |
| Legal requirement | Mandatory under the Motor Vehicles Act of 1988 | It is optional but recommended for comprehensive vehicle protection. |
| Scope of protection | Limited to third-party liabilities. | Provides extensive coverage for various risks to your car. |
| Premium cost | Lower premiums compared to own damage insurance. | Higher premiums due to broader coverage. |
| Add-on options | No add-ons are available. | Multiple add-ons like depreciation cover, engine protect, and roadside assistance are available. |
| Customisation | Not customisable. | Customisation options are available to suit individual needs and preferences. |
| Ideal for | Meeting basic legal requirements for car insurance. | Protecting valuable or frequently used vehicles from unforeseen expenses. |
Why car owners need own damage insurance
Experts highlight several benefits of own damage insurance. Here’s why vehicle owners should consider buying own damage insurance:
- All-round coverage: Own damage coverage shields against major costs if your vehicle gets damaged. But it provides more than just financial protection. Add-ons like depreciation cover and consumables cover give complete peace of mind.
This coverage is essential for car owners to safeguard their automotive investments.
- Saving huge repair costs: Own-damage car insurance protects car owners from high repair costs. Premium policies cover damage and provide vital financial protection given the often exorbitant price of fixing or replacing components of high-end vehicles.
- Yearly validity: Own damage car insurance policies offer protection for one year. Renewing them after this period can help car owners continue their coverage without lapses. Policies cover repair costs from natural calamities and other damages to the car.
- Network garages: Own damage insurance allows cashless repairs at quality repair shops. Simply take your car to a covered garage, and the insurer pays the bill directly. There is no need to pay upfront or wait for reimbursement. Hassle-free settlements can help fix your car quickly so you can return to the road soon. Network garages make the claims process smooth and convenient.
Top benefits of own damage car insurance
Notable benefits of own damage car insurance include the following:
- Damage cover: Own damage insurance delivers comprehensive protection for one’s vehicle against calamities, riots, and more. With this policy, one can drive stress-free, knowing that any financial burden from accidental damage or loss is covered. It is a small price for invaluable peace of mind for you and your prized automobile.
- Optional add-on: It allows customised protection to suit one’s needs. Insurers can add optional covers like engine protect for extra security. If you have invested in performance modifications or custom work, declare these to the insurer for appropriate coverage. The flexibility to match individual requirements provides comprehensive protection to protect your prized vehicle.
- Premium discounts: Owning own damage car insurance can be cost-effective with premium discounts. On top of no-claim bonuses, additional savings can come from installing safety devices, voluntary deductibles, and more. With multiple discount opportunities for lowering premiums, own damage protection can get even more budget-friendly.
Tips for choosing the right own damage insurance
To ensure that they get the most out of their own damage insurance, buyers should consider the following tips:
- Evaluate your needs: Consider factors like your car’s age to determine the appropriate level of coverage. Custom or high-end vehicles need more protection.
- Opt for relevant add-ons: Include extras like depreciation cover for new cars or engine protect add-ons if you drive in flood-prone regions.
- Check the Insured Declared Value (IDV): Verify that the IDV matches your car’s current market value, including its special features. This can ensure adequate compensation at the time of claim.
- Understand exclusions: Review exclusions to know what circumstances could lead to void claims. Usual exclusions include drunk driving or intentional damages. Being aware can help reduce surprise claim denials.
Conclusion
For car lovers, vehicles signify more than transportation. They embody passion, identity, and significant investments. Third-party insurance alone cannot fully protect these cherished possessions. Own damage coverage can help bridge gaps in insurance protection with comprehensive policies catered to the specific needs of the owners.
The right plan and add-ons can help safeguard your prized possession and give you peace of mind. Embrace own damage insurance to drive confidently, knowing your car is shielded.
Frequently Asked Questions
Q1: Is own damage insurance mandatory?
A1: Own damage insurance is optional, unlike third-party insurance, which is mandatory under the Motor Vehicles Act 1988. However, it is highly recommended that car owners take comprehensive vehicle protection policies.
Q2: Can I buy own damage insurance for an old car?
A2: You can purchase own damage insurance for older vehicles. However, the premium and coverage can vary depending on the car’s age and condition.
Q3: How does depreciation cover add-on benefit for car owners?
A3: Depreciation cover ensures full claim settlement without deducting for wear and tear, making it ideal for preserving the value of upgraded or modified cars.
Further Reading
