Different Types of Car Insurance

Across major countries and states, getting a third party car insurance is mandatory. A third party covers all the expenses related to car accident except anything related to you i.e. your car, your medical expenses or any other of your possessions!! Feeling cheated?? Well I also felt the same when agent told me about it, when I went to buy auto-insurance as an insurance novice.

Today I would be enlisting different types of car insurance and would like to help you out in choosing the best auto insurance for you. Please bear in your mind the universal rule: Nothing comes for free, you need to pay more if you want more.

Third Party Car Insurance

As discussed, by law, third party insurance is the minimum cover a driver must have for driving a car across a city or countryside. It is also called Liability Insurance. In case of accident, if it is found that you or your driver is at fault, then by the help of liability insurance you can save yourself from all the expenses ranging from medical to legal expenses of other party.
Why you should buy third party liability insurance?
It has the lowest premium. Till the time the claim amount is lesser than the insurance cover, you are guarded from all the expenses of your negligence.  If you have enough confidence in your driving that you won’t ever hurt other party in an accident then go for 3rd party insurance.
Why you shouldn't get only third party insurance?
Being the basic type of motor policy, it provides minimum coverage to a motorist. In case of accident, any expenses pertaining to your possessions will have to be borne by you. It’s a very risky proposition in case you are banking on third party insurance alone.
Types of Motor Car Insurance Comparison
Comparison chart of different types of Car Insurance

Third Party, fire and theft Insurance

A better cover as compared to liability insurance alone, this one offers cover to your vehicle in case of fire or theft (repair in case of attempt of theft is also covered).  Buying this policy would help you cover the legal obligations as well as provide a bit extra safety net. Usually the premium charged for this type of insurance is a little more than the one charged for third party insurance alone. You may consider going for third party insurance alone if your car is old and you don’t wish to give extra premium for covering it from theft or fire.

Comprehensive Car Insurance

Here is a policy which covers all time of claims which you may be required to make pertaining to your car. In fully comprehensive policy, everything with respect to your vehicle, you and third party is taken care of.  As expected this type of insurance is bit heavy on your purse, as you need to pay highest premium for it but at the same time you can save thousands of dollars in repair, legal or medical expenses.   75% of motor owners around the world go for comprehensive car insurance. Here it must be noted that various insurers tweak their offerings a bit to reduce premium; so in order to enjoy the complete range of coverage, it is advisable to read the offer document well before buying the policy. The Devil is in detail!!!  In case some key coverage is missing you can opt for other insurer or get the add-ons on the policy offered.

Bottom Line: There are various variants of these three basic types of car insurance in the market. Pay as you drive is one of the widely preferred innovative offering brought by few of the insurers. You need to sit down and finalize what all risks you perceive are paramount and need to be covered for your vehicle before choosing any insurance product. Also as many of us don’t understand insurance properly we end up paying more for a coverage which we might not require, thus read the policy documents well and negotiate with your broker accordingly.
Write to us in case you have any queries regarding auto-insurance…. Ianswer4u J

You May Also Like to Read:
What is covered under Car Insurance?
Insurance for Beginners 
Short Term or Temporary Car Insurance

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