Comprehensive insurance provides financial assistance for the repairs if a policyholder’s car suffers from damages. While third party car insurance only covers the damage to third-party property, a comprehensive policy covers a policyholder’s car as well. If a person buys a comprehensive plan, then they also get the benefits of third-party insurance, albeit the premiums are expensive.
The cost to repair the damage to a car can be expensive in case of an accident. However, such expenses can be brought down significantly with the help of a comprehensive policy. Meanwhile, a comprehensive plan also covers the policyholder against natural calamities such as earthquake, floods, etc. and human-made disasters such as theft, burglary, etc.
Here are some benefits of purchasing comprehensive car insurance-
- In case of an accident, comprehensive car insurance covers the damage to the policyholder’s car as well as the third-party property.
- A comprehensive policy covers the cost of medical treatment arising due to an accident. In case of disability due to an accident, the sum assured will be offered to the policyholder.
- The insurer offers the death benefit to the policyholder’s nominee.
- Comprehensive car insurance offers cover against natural calamities such as earthquake, flood, etc.
- A policyholder will also be covered against human-made calamities such as riots and terrorism.
- Cashless facility will be provided to the policyholders if they visit network garages. If a policyholder gets their car repaired at a network garage, then they don’t have to pay in cash as the insurer directly settles it with the service operator.
HDFC ERGO is one such insurer that offers these benefits. A policy buyer can also get a broader protection net by purchasing the add-ons provided by HDFC ERGO.
Here are some important add-ons you can buy with car insurance-
- Zero Depreciation Cover
A car’s value depreciates over time, and this depreciation is accounted for when a claim is made. The insurer will offer cover only after deducting the depreciation value. Many people find it difficult to understand why the insurer doesn’t cover the complete cost of the repair. It is due to depreciation.
For example, a policyholder meets with an accident. The cost to repair the car is Rs. 18,000. However, the insurer is only offering a cover of Rs. 10,000 after deducting the depreciation value. In such a situation, the policyholder will have to pay Rs. 8,000.
(A point to note-The depreciation percentage is different for different parts of a car.)
However, when a policyholder buys a zero depreciation cover, the insurer doesn’t deduct the depreciation cost from the cover amount.
- Return to Invoice
To understand the benefit of return to invoice, one needs to first understand the insured declared value (IDV) of a car. IDV is the market value of a car. As cars are depreciating assets, their market value goes down every year. Hence, the cover is offered based on the present market value of a policyholder’s car.
In a situation of theft, the insurer considers the IDV of a car and not the original price. The cover amount will be lower than the initial cost of the car.
If a policyholder buys return to invoice add-on, then the insurer will also cover the price difference between the IDV and invoice value. Hence, saving a great amount of money for a policyholder.