: Typical components of a car insurance #IndiaNEWS #Business Car insurance is much more than just a document that protects you against a traffic ticket. Similar to health insurance, your car insurance

Typical components of a car insurance #IndiaNEWS #Business
Car insurance is much more than just a document that protects you against a traffic ticket. Similar to health insurance, your car insurance ensures that you may get your car fixed without spending a lot of money at the repair shop in the event of an accident.
It protects you from claims, including legal fees, filed against you as a result of an accident. It also covers damage caused by causes other than an accident, such as theft, fire, and so on. However, have you ever wondered what are the typical components of a car insurance policy?
What are the components of a car insurance?
If you are buying a car insurance policy, it is very important for you to be aware of its components in order to make an informed purchase. Following are some of the key components of a car insurance policy:

Third-Party Coverage: The third-party component covers any harm your vehicle causes to others. The third-party coverage is determined by the engine capacity of the vehicle. Physical injuries, car damage, property damage, and death are all covered. If the collision was caused by intoxicated driving, third-party insurance will not compensate you.

According to the Motor Vehicle Act 1988, it is mandatory for all car owners to buy third-party coverage. If you are driving on the road without valid car insurance coverage, then it may lead to serious legal issues.

Own Damage Cover: The own damage cover, unlike the third-party cover, covers damages to your own vehicle. The IDV, or insured declared value, of the car is used to calculate the own damage protection, which can be disclosed at the time of insurance purchase.

This policy covers your car for damages caused by road accidents, fire, natural disasters, or any other unforeseen circumstances. Its purpose is to provide you with additional coverage in addition to third-party liability. After the Insurance Regulatory and Development Authority of India (IRDAI) issued an order allowing car owners to purchase a standalone own damage policy cover in addition to a third-party liability cover, car insurance policyholders are now able to choose between different car insurance companies for both covers.

IDV: The IDV stands for ‘Insured Declared Value’. It is normally fixed at the start of each policy period for each covered vehicle and is referred to as the SUM INSURED for tariff purposes. IDV is computed by multiplying the vehicles current Manufacturers Listed Selling Price by a percentage of depreciation.

PIP (Personal Injury Protection): Personal injury protection (PIP) assists in the reimbursement of covered medical expenditures incurred as a result of a car accident. It can also be extended to certain members of your family who reside with you.