Points to ponder on car insurance

Car Insurance

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If you already have a car or are planning to buy one, getting a motor insurance is mandatory to get your car registered with the Roads and Transport Authority (RTA).

There are broadly two types of insurance: comprehensive and third party cover. A comprehensive plan covers vehicle loss and third party injury and damage. It has a higher premium than the basic third party cover which ensures liability only towards a third party in case of an accident.

Each insurance cover is valid for 13 months. Premium is based on several factors such as the year and model of the car, value of the vehicle, age of the driver and claims history. If you have more claims during a particular period, the insurance company will raise your premium for the next term. If you plan to buy a motor insurance soon, keep these tips in mind:

Do your homework – Take quotations from several insurance companies and compare covers and premiums. There are several comparative sites online or ask your colleagues at work, friends, or meet a financial adviser.

Claims procedure – Most of us look at the cost of the insurance, but the important thing to check is the claims history of insurance companies. Do they easily process claims after an accident or do you need to go round in circles to get it? You need to read the policy fine print and check the reputation of the insurance firm.

Add-ons – There are several add-ons with each policy, or you may need to pay more for them. These include blood money cover in case of death due to accident to the third party, 24/7 accident and recovery service, repair at authorized dealers, off-road cover and medical expenses in an emergency situation.

Handy Hints
• Comprehensive insurance covers vehicle loss, etc.
• Third party cover ensures liability only to a third party
• Do compare premiums of several insurance firms

Source: S. Dhar, Special to Classifieds, The writer is a freelancer