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Ideal car insurance coverage for city drivers

Team AckoMay 17, 2022

Owning a four-wheeler in a city can be liberating. After all, it reduces your dependency on public transport such as trains, metros, and buses. Thus, a considerable percentage of the country’s population drives their car to the office and back home. They also use it on weekends to visit relatives, go to the mall, etc. We can classify such people as city drivers. If you identify yourself as a city driver, then this article is for you. Read ahead to know the ideal insurance coverage for city drivers.

Ideal Car Insurance for City Drivers

What is ideal car insurance coverage for city drivers?

Ideal car insurance coverage for city drivers means a policy that covers most of the car-related risks. These risks can be different for different people. As a result, the definition of an ideal car insurance cover can vary from person to person.

In India, you can insure your four-wheeler with two foundational car insurance policies. The first one is the bare-minimum Third-party Car Insurance Policy. And the second is the wide-ranging Comprehensive Car Insurance Policy. Here’s a brief explanation of these policies.

1. Third-party Policy

Such a policy is mandatory. It covers third-party liabilities. This means your liability towards a third party shall be covered if you accidentally injure them (including death) or damage their property. Failing to meet this legal requirement can result in severe penalties. Note that this policy doesn’t cover damages to your vehicle.

2. Comprehensive Policy

Such a policy offers you third-party coverage and insures your car as well. With this policy, your car is insured against car theft and damages due to fire, accidents, calamities, etc. Another advantage of a Comprehensive Policy is that you can enhance the cover with suitable add-ons. Some of the popular car insurance add-ons are Zero Depreciation, Roadside Assistance, etc.

Your ideal car insurance coverage will depend upon the car-related risks faced by you and the type of policy and add-ons chosen by you to cover those risks. 

Common car-related risks faced by city drivers and their ideal insurance coverage

It’s best to purchase car insurance based on your requirements. And one way of knowing these requirements is by understanding the risks your car might be exposed to. Here are some of the common car-related risks and different car insurance coverages for city drivers.

1. Third-party liabilities

One of the fears faced by city drivers is that of injuring a pedestrian. Similarly, an out-of-control car can damage someone’s property. All these are classified as third-party liabilities for you.

Ideal cover: Third-party Policy or a Comprehensive Policy.

2. Accidents

City traffic can be chaotic. Thus, car accidents are a common sight. If you damage another person’s car, they can raise a third-party claim on you. Similarly, if your car is damaged by another car owner, you can raise a claim on them. But there can also be scenarios where you damage your own car due to hitting it on the pavement, brushing against a wall, reversing incorrectly, etc.

Ideal cover: Comprehensive Policy + Zero Depreciation Cover (covers car’s depreciation cost)

3. Flooding

Coastal cities such as Mumbai and Chennai have experienced flooding regularly in the recent past. Thus, flooding has become a common risk faced by car owners. Floodwater can cause considerable damage to the car’s parts.  

Ideal cover: Comprehensive Policy + Zero Depreciation Cover 

4. Vandalism

Vandalism is a man-made calamity. It’s unpredictable and can cause damage to public and private property. For instance, your car can get damaged in a riot — broken windshield, dents, and severe scratches are some of the possibilities.

Ideal cover: Comprehensive Policy + Zero Depreciation Cover

5. Treefall

Top Indian cities are struggling for space. Lack of parking space is a common hassle, especially in metro cities. Thus, it’s not uncommon for cars to be parked underneath trees. This makes the vehicles vulnerable to damage due to treefall, especially in the rainy season.

Ideal cover: Comprehensive Policy + Zero Depreciation Cover

6. Theft

As per news reports, Bengaluru witnessed 3,797, and Mumbai witnessed 2,801 motor vehicle thefts in 2020. Similarly, other cities have also experienced vehicle thefts. Thus, car theft is a genuine concern for vehicle owners.

Ideal cover: Comprehensive Policy + Return to Invoice Cover (to receive car’s invoice value on theft)  

7. Damage beyond repair

There can be instances where your vehicle can be severely damaged. The intensity of the damage can be such that the vehicle might be beyond repair.

Ideal cover: Comprehensive Policy + Return to Invoice Cover

8. Car breakdown

Car breakdown is a common occurrence. This can be troublesome if the location of the breakdown is not familiar to you. It can be difficult to find a nearby garage in such a scenario.

Ideal cover: Comprehensive Policy + Roadside Assistance Cover (for mechanic/towing support)

9. Engine damage

Repairing the car’s rear-view mirror can be manageable on your own, but the same can’t always be said about damage to the car’s engine. Damages to the engine can prove costly to repair. And they are usually excluded from a Comprehensive Cover.

Ideal cover: Comprehensive Policy + Engine Protection Cover (to insure the car’s engine)

10. Injuries

Car accidents can cause permanent injuries to the driver as well as the passengers. Note that you need to buy a Personal Accident Cover along with car insurance if you don’t have one. It’s mandatory.

Ideal cover: Comprehensive Policy + Personal Accident Cover for Passengers (insurance for permanent disability and death)

Takeaway

You might consider insuring your car with only a Third-party Policy to save money, but what if your car gets damaged? The monetary outflow will be extensive in this case. Thus, it’s ideal to insure your car with a Comprehensive Policy, even though it’s more expensive than the Third-party Policy, as it offers wide-ranging insurance coverage.

As is evident from this article, a Comprehensive Policy along with suitable add-on covers will cover you against common risks faced by city drivers. Before finalising, do check outtypes of car insurance policies on ACKO (subject to availability).

Frequently Asked Questions (FAQs)

Here’s a list of common questions and answers related to ideal car insurance coverage for city drivers.

Should I consider buying a No Claim Bonus (NCB) Protection Cover if most of my driving is within the city?

As mentioned in the article, there are several ways in which your car can get damaged in a city. And if your car does get damaged, you should raise a claim. Here, the No Claim Bonus Protection Cover will keep your NCB active even if you raise a claim. Thus, it can be beneficial for city drivers.

Is the best car insurance for city drivers available online or offline?

There isn’t one perfect car insurance cover. You need to buy one as per your needs. Usually, buying car insurance online is easier, cheaper, and more convenient as compared to offline.

What is Zero Depreciation Car Insurance, and should city drivers buy it?

A combination of a Comprehensive Policy and a Zero Depreciation Cover is commonly known as Zero Depreciation Car Insurance. City drivers can consider buying it as it helps receive a higher claim settlement.

I had purchased Third-party Car Insurance online, and now I want to shift to a Comprehensive Cover from a different insurer as I am moving to a metro city. Is it possible?

Yes, you can make such a shift easily during online car insurance renewal by visiting ACKO’s website/app.

Does online car insurance insure me against a situation where my car is damaged due to a fire caused by an accident?

A Comprehensive Car Insurance Policy purchased from a registered insurer covers damages due to fire. However, the exact claim settlement will depend upon the claim inspection process and the policy’s terms and conditions.

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