Many times it happens to us that we buy a new car, then many insurance agents come in front of us, because we need to do insurance for the new car. But we don’t know which insurance will be good for our car and what to cover. We do insurance as the agent tells us. Later when the accident happens, when we go to make an insurance claim, it is found that many things are not covered by our insurance.
So everyone should know what insurance is, what insurance works, and how insurance works.
Types of Car insurance:
- Third party insurance
- Comprehensive insurance
- Zero dept insurance
- RTI (Return to invoice) insurance
Some agents will say there are only 2 types of insurance. But actually there are 4 types of insurance. Those who talk about 2 types of insurance say that the remaining 2 insurances are addon features of the first 2 insurances.
1.Third Party Insurance:
If it happens that your car has an accident with another car, where you were at fault. It damages your car, the person who has an accident with his car is damaged, he is damaged. Here the person you accident with is called 3rd party.
In such an accident if you have 3rd party insurance then your insurance company will cover the damage to the car and driver of that 3rd person. But don’t cover yourself and your car. You must repair the damage to your vehicle yourself.
Suppose you have Third Party Insurance from SAN LTD Company. Now if you have an accident with a car. Then your Sun Limited Insurance Company will compensate the car and the driver of the car with which you had an accident. But the insurance company will not pay the compensation for the damage to you and your car.
And if the accident is not your fault. If the 3rd party vehicle is at fault then he and his insurance company will compensate you.
Note: Everyone should have minimum 3rd party insurance. Because it may happen that you had an accident with a car that car was very expensive. The driver of that car is very rich. And if the driver is dead, you may have to pay a lot of compensation which you may not be able to afford. So if you have at least 3rd party insurance, this compensation will be paid by your insurance company.
Having this insurance covers you if you have an accident with either vehicle and both vehicles are damaged. Then your insurance company will cover both the car and the driver. However, full compensation will not be given here. Some companies have conditions that they will pay these damages.
If this insurance is done, the insurance company will pay all the damages of your and the 3rd party’s car’s metal parts. But only 50% compensation for plastic parts, glass and tires. You have to pay the remaining 50%.
3. Zero dept insurance:
If you take this insurance, you have to pay about 30% more money to the insurance company. This insurance has to be add on in comprehensive insurance. It cannot be added to 3rd party insurance.
You can keep this insurance until the age of your car is not more than 5 years. If the age of the car is more than 5 years, you can not add zero dept insurance on the insurance of that car.
You can claim this insurance maximum 2 times in a single year.
So you don’t have to pay anything?
No. You have to pay these:
- File charge
- all costs of consumable parts like lubricants, coolant, breakoil, bearings, nut bolt etc.
- Salvage costs. (All the chenged metal parts selling costs) Metal parts that have been changed. The money obtained by selling the old parts should be paid to the insurance company.
4. Return to invoice (RTI):
This insurance comes in handy if it ever happens that the car cannot be repaired after an accident. If the car cannot be repaired and your car have RTI insurance then the insurance company will pay you the full cost of buying your car.