Common Mistakes to Avoid When Buying Four-Wheeler Insurance

Purchasing four-wheeler insurance is essential for protecting your vehicle and ensuring that you are financially covered in the event of an accident or other damage.

However, many car owners make mistakes when selecting their insurance, resulting in inadequate coverage or unexpected costs later on. 

Understanding these common errors can help you avoid costly mistakes and find the best car insurance in India.

This article will highlight the most frequent pitfalls to avoid when purchasing four-wheeler insurance and provide tips on making the right choice.

Mistakes to Avoid When Buying Four-Wheeler Insurance

1. Not Transferring Insurance for Second-Hand Cars

One of the most common mistakes when buying a second-hand car is failing to transfer the existing four wheeler insurance to the new owner’s name.

Under Indian law, only third-party liability coverage is automatically assigned when a vehicle is sold. 

The “Own Damage” coverage, which protects your car, must be officially transferred within 14 days.

If the policy is not transferred in time, the insurance company may reject any claims made for damages to the vehicle or third-party liability.

Buyers and sellers of used vehicles should ensure the timely insurance policy transfer to avoid legal and financial complications. The process is simple: submit the necessary documents to the insurance provider.

2. Opting for Only Third-Party Insurance

Another mistake many vehicle owners make is opting for only third-party insurance to save money.

While third-party insurance is mandatory in India, it only covers damages caused to another vehicle or person. 

It does not cover damages to your car, leaving you financially exposed in case of an accident. Comprehensive insurance, on the other hand, covers both third-party liabilities and damage to your vehicle.

Choosing comprehensive insurance might seem more expensive upfront, but it provides complete protection, ensuring you are financially safeguarded.

This is especially important when considering the long-term costs of repairing a damaged vehicle.

3. Ignoring the No-Claim Bonus (NCB)

The No-Claim Bonus (NCB) rewards policyholders for not making any claims during the policy year.

This bonus can significantly reduce your four-wheeler insurance premium when renewing the policy.

Unfortunately, many car owners forget about this benefit or make small claims that reset the NCB, resulting in higher premiums.

To maximise your savings, only file small claims less than the NCB discount you would receive. It’s often more cost-effective to pay for minor repairs out of pocket and retain your NCB for a more significant discount on your next car insurance renewal price.

4. Not Comparing Different Insurance Plans

Choosing the first insurance plan you come across is a common mistake. Failing to compare different insurance providers and plans can lead to paying more than necessary or getting inadequate coverage. 

The best car insurance in India may not always be the cheapest; looking at the benefits, coverage, claim settlement ratio, and additional features each provider offers is essential.

Always take the time to compare plans from different insurers, ensuring that you choose one that suits your needs and offers the right balance of cost and coverage.

5. Forgetting to Renew Your Policy on Time

Timely renewal of your four-wheeler insurance is critical for ensuring continuous coverage. Allowing your insurance policy to lapse can result in losing your No-Claim Bonus and expose you to financial and legal risks. 

Driving without valid insurance is illegal in India and can leave you liable for significant out-of-pocket costs in case of an accident.

Set reminders or opt for automatic renewal to ensure your policy is renewed on time, maintaining uninterrupted coverage and avoiding unnecessary penalties.

Conclusion

Buying four-wheeler insurance is a crucial step in protecting your vehicle.

Mistakes like failing to transfer the policy for second-hand cars within the 14-day window, opting only for third-party coverage, and overlooking the No-Claim Bonus can lead to financial losses.

By comparing plans and ensuring timely renewal, you can avoid these pitfalls and secure the best car insurance in India that meets your needs.

Proper planning and awareness will save you money and provide peace of mind, knowing you are fully covered on the road.