Car Insurance is a legal requirement in many countries, like India. It also brings you assurance as well as protection foryour new car against any unfortunate event in future. However, purchasing car insurance is not a decision that can be taken lightly. Several key factors play acritical role in making the right choice.
Most Insurance companies offer mainly two types of insurance covers to any car owner. The first is the Comprehensive Car Insurance and the second is the Third Party Car Insurance. The main difference between them is the extent of insurance coverage they provide.
Understanding Comprehensive Car Insurance
A comprehensive car insurance plan provides complete protection against damages to both parties involved in anaccident. An extensive coverage;safeguards to your car like:
- Personal accident cover.
- Any damages to the car during a crash.
- Natural catastrophes like floods, earthquakes etc.
- Legal liability to any third party
- Glass damage like if the windshield gets broken.
- Damages inflicted on the vehicle by any animal or bird.
- Damages caused by falling objects, missiles etc.
The policy further allows you to include add-ons like accessories cover, zero depreciation cover, engine protection etc. Due to its higher benefits, it may attract a higher premium than the other type of car insurance; however it provides an all-round coverage
Understanding Third Party Car Insurance
Third-party car insurance offers financial protection to you against any legal liability that arises due to injury happening to another person, his vehicle or his property due to a car accident in which you are at fault. Usually, the third party person and his car are covered and an extra charge is added to the premium amount to cover the third-party’s property. This insurance assumes high importance in accident-prone areas as they cover your liability as well as any medical costs. According to The Motor Vehicles Act, 1988, it is mandatory to buy the Third-party insurance for your vehicle.
Differentiating Between the Two Insurance Plans
Each insurance plan has its own pros and cons. It is critical that you understand them, analyze them, compare them and then make a wise choice. Few things to consider while making a choice are:-
Both plans provide different types of coverage. The third party provides you coverage against all financial and legal liabilities that you need to incur if your fault has caused the accident. However, it does not offer any coverage to your own damage in case of total or partial loss. You need to bear all your financial expenditures on your vehicle by yourself.
However, if you desire to have the expenses of your vehicle covered, then the comprehensive insurance plan would fit the bill. The terrific thing about it is that it has third-party insurance plan included inside it.
Since the comprehensive insurance plan encompasses the third-party insurance plan and offers you more extensive coverage, it is highly recommended. A road mishap is an unfortunate incident that can catch you unawares. With the third-party insurance, you need to bear all the own damage expenses for your car but with comprehensive, you are totally covered. In view of the expense that you might need to bear in the scenario of an accident, the comprehensive car insurance proves a cheaper and more mentally reassuring plan. These plans can be bought online with just a few clicks. You can also compare the plans online before you pay the premium.