Nikhil Sharma, an IT engineer working with a leading IT firm, is very excited. Why wouldn’t he be? He is going to celebrate the successful completion of his first year in the job by buying a car. Though he is quite clear about the brand and the accessories that he wants with his very first car, certain questions confuse him.

The one leading the pack of such nitty-gritty’s associated with buying a vehicle is: “Should I buy car insurance? Isn’t that going to stretch my budget further? Moreover, I am a careful driver and ready to shoulder any expense that might result from an accident or other related circumstances. Why then, do I need a car insurance policy?

Nikhil here is trying to tackle too many ‘ifs’ and ‘buts’. The rest of the article tries to answer some of the most pressing questions that this young IT engineer seems to harbor. You can have your answers as well. Read on to know more:

  • Why should I buy car insurance?
  • For starters, if you own a car, it is mandatory to own a car insurance policy to go with it - as per Section 146 of the Motor Vehicles Act, 1988. In India, it is imperative for every car to be insured before it can play on the roads.

  • Tell me one of the bigger advantages of buying a car insurance policy
  • Peace of mind.

    A comprehensive motor (car) insurance policy offsets financial loss that may result from damages (owing to both natural calamities and man-made causes such as terrorist attacks, riots, theft, etc.) sustained by your car. Besides, personal accident coverage and third-party legal liabilities are also covered under a comprehensive car insurance policy.

    Simply put, comprehensive coverage is full-fledged coverage, one that can take all the stress off you so that you can give your best shot behind the wheels.

  • What is a ‘Third-party car insurance coverage’? What are its benefits?
  • A third-party car insurance policy is the bare minimum that you are mandated to have before you decide to take your car out on the road.

    With third-party insurance coverage, you can get protection against legal liabilities (including death or bodily injuries) towards a third-party as well as damages (caused by your car) to third-party property.

  • Are there any additional perks in store for me?
  • With a nominally higher premium, you can benefit from additional covers on your comprehensive car insurance policy. That being said, these covers are ‘over-and-above’ the comprehensive plan and cannot be purchased on a stand-alone basis.
    Add-on covers are designed with the objective to compensate for a few policy exclusions and lend personalization to the original coverage. Some of the more popular add-ons are:

    • Zero Depreciation Cover
    • 24x7 Roadside Assistance Cover
    • Passenger Protection Cover
    • Engine Cover

  • What about a No Claim Bonus (NCB)?
  • If you drive responsibly and end up not filing any claim within one year of having availed the car insurance policy, you would be entitled to a No Claim Bonus (NCB) discount on your premiums for the next year.

This is one of the easier ways to save big on car insurance premiums – the only thing you’d have to be is a responsible driver.

After having gone through all the benefits, chances are Nikhil would be a lot more confident now and avail his car insurance policy quick.

Click hereto apply for a motor insurance.


The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.

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