You’ve been driving your car for years, paying your insurance premiums on time, and feeling secure in the knowledge that you’re covered in case of a road accident. One day, however, a tree branch falls on your car during a storm, and you wonder if your car insurance will cover the damage. To your surprise, it does! This raises the question — what else does my car insurance cover that I didn’t know about? It turns out that there are several lesser-known scenarios where car insurance can come to your rescue.
Listed below are 10 hidden perks of your car insurance policy:
Many people believe that car insurance provides financial protection only in the event of a road accident. However, this is not the case. Insurers will also cover repairs if the car sustains damage due to fire (such as bushfires or electrical faults in the parking area). Additionally, damage caused by man-made riots or natural calamities like earthquakes, cyclones, or landslides is also covered by your policy.
Planning an adventurous road trip but realised your car insurance policy has expired? No need to worry. You can quickly renew your insurance by visiting your insurer’s website. Simply enter your car’s registration number, pay the premium, and your car is covered again — all within minutes! Best of all, this process is paperless, and you don’t need to visit the insurer’s office in person. Just ensure you have digital copies of any required documents for policy renewal.
What if we told you that you could enjoy up to a 50% discount on your car insurance premium? Yes, it’s possible.
Motor insurers reward safe drivers with a no-claim bonus (NCB) for avoiding claims during the policy period. According to the IRDAI, the NCB percentages for consecutive years are as follows:
If you use your car for business purposes, you can avail of a tax benefit through your car insurance. To claim this, ensure you record the insurance premium payment as a business expense in your income statement. Additionally, the vehicle must be registered in the company’s name. If the business is a sole proprietorship, the vehicle should be registered in the business owner’s name.
Over time, your car’s value declines due to wear and tear. If you make a claim, the insurer typically pays for repairs or replacements after accounting for depreciation. However, you can opt for zero depreciation cover, which eliminates this deduction and ensures full compensation for repairs or replacements.
Here’s a guide to the depreciation rates set by the IRDAI:
Depreciation of Car’s Components
If your car sustains damage exceeding 70% of its value in an accident or fire, or if it is stolen, you may be eligible for reimbursement up to the invoice value of your car. This facility is available only if you have opted for a return-to-invoice add-on and if your car is not older than five years.
The engine is one of the most expensive parts of a car. However, many drivers are unaware that standard car insurance does not cover damage to the engine or its components caused by water ingress, lubricant leakage, or other issues.
You can purchase an engine protection rider for an additional premium, securing your engine against these types of damage.
If you’re driving on the highway and your vehicle breaks down, the nearest garage might be too far away. In this case, you can call your insurer to arrange for towing assistance.
Don’t worry about the towing fees — most insurers cover towing expenses up to a specific limit under their standard plan. For instance, if the maximum limit for towing charges is £300, you can use the full amount for one incident or across multiple requests.
If your car injures a person or damages property outside the insured vehicle, third-party car insurance will cover the cost of the damage. While the insurer sets the premium for liability coverage, did you know you can save on these premiums as well?
If you're confident in your driving skills and believe you can avoid third-party claims, you can opt for a reduced liability insurance premium.
Your car is equipped with various high-end accessories that can be costly to replace if damaged. While standard policies may not cover accessories, you can opt for add-ons or riders that provide this coverage. Although these riders may slightly increase your premium, they are still a more affordable option than paying for repairs or replacements out of pocket in the event of a mishap.
Car insurance is much more than just a safety net for road accidents. It can protect you from various unexpected situations — ranging from natural disasters and vandalism to falling objects and animal collisions. It also covers damage to the engine and accessories while ensuring you don’t have to pay out of pocket for towing charges. Beyond the basic coverage, discounts on premiums, tax benefits, and the convenience of paperless policy renewals are some key advantages of having car insurance.
Disclaimer: This content is part of a marketing initiative. No TNIE Group journalists were involved in the creation of this content.