Don’t Be Fooled by These Common Car Insurance Myths

"Despite having access to information online, many car owners still fall for common insurance myths that can leave them financially vulnerable. In the event of an unexpected accident, the cost of repairs can be substantial. It is essential to separate fact from fiction to make informed decisions and ensure real financial security on the road." - Shubham Moondra, Chief Product Officer at Royal Sundaram

Let’s debunk some of the most widespread myths surrounding car insurance:

Myth 1: Older Cars Don’t Need Insurance

Although your car may have aged, risks like accidents, theft, and third-party liability remain. While the Insured Declared Value (IDV) depreciates over time, a car insurance policy ensures continued protection.

Myth 2: Insurance Doesn’t Cover Natural Calamities

A comprehensive car insurance policy provides coverage against floods, earthquakes, and fire. However, premiums may vary based on geographic risk factors.

Myth 3: If There is Total Car Damage, The Insurer Will Pay Full Reimbursement to its Invoice Value

In Motor Insurance, the sum insured is the Insured Declared Value (IDV) of the vehicle. As the vehicle ages, the IDV decreases annually. Unless you have a Return-to-Invoice add-on for a wider coverage, insurers will reimburse only IDV of your vehicle. Understanding these terms before purchasing a policy is crucial.

Myth 4: Insurance is Non-Transferable, and No-Claim Bonus (NCB) is Lost

Car insurance policies are transferable when selling a vehicle. However, NCB is attached to the customer and not to the vehicle. Hence, you can get NCB certificate from your insurer and transfer your NCB to your new vehicle's insurance policy. This NCB certificate is valid upto 3 years from the date of issue.

Myth 5: If Someone Else is Driving Your Car, the Insurance Won’t Cover Accidents

If the driver holds a valid license and driven the vehicle with your permission, your insurance policy will cover damages as long as they are complying with the terms and conditions of the policy.

Myth 6: Cars in Rural Areas Don’t Require Insurance

Motor insurance is mandatory across India, irrespective of traffic density. Accidents, theft, and natural calamities can occur anywhere, making coverage essential even in less populated regions.

"Car insurance is not just a legal formality; it is your financial shield. Understanding what’s covered ensures that you stay protected in every situation." - Shubham Moondra, Chief Product Officer at Royal Sundaram

Stay Informed, Stay Protected

With rising car ownership and unpredictable road conditions, being misinformed about insurance can prove costly. Instead of relying on assumptions, make an informed choice. A comprehensive insurance policy safeguards your vehicle, finances, and peace of mind.

Royal Sundaram's comprehensive car insurance provides extensive coverage, ensuring financial protection in every scenario. From accidental damage to theft and vandalism, the policies safeguard your vehicle against unexpected risks.