Comprehensive Car Insurance

Question 1

What is Car Insurance?

Accepted Answer

Car insurance provides protection to your car against damages which may result in financial losses. Additionally, it also insures you to the extent of any third party liability arising from the use of the insured vehicle.

Question 2

What are the different types of insurance policies available? Is it compulsory to take OD/ comprehensive cover?

Accepted Answer

There are two types of Car Insurance policies – Third Party Insurance and Comprehensive Insurance policy.

Question 3

What is a Third Party Insurance policy?

Accepted Answer

Third Party Insurance is the most basic prerequisite by law to drive a vehicle in India and is also the most economical insurance coverage option. It is a liability only policy that provides cover against any legal liability, damages and injuries caused by the insured vehicle to a third-party person or property.

Question 4

What is a Comprehensive Insurance policy?

Accepted Answer

A comprehensive insurance policy provides protection from road accidents, fire, theft, vandalism, falling objects, damage to insured vehicle by animals, natural disasters, civil disturbances and third party liability in the event of third party property damage, bodily injury and death.

Question 5

Is buying Car Insurance mandatory?

Accepted Answer

As per the Motor Vehicles Act, 1988, it is mandatory for every motor vehicle plying on the road to be insured with a Third Party Liability only policy at the very least.

Question 6

Should I buy a Comprehensive Car Insurance or just a Third Party policy?

Accepted Answer

As per the law, a third party liability only policy is mandatory, without which one cannot use the vehicle on the road. However, under a third party liability only policy, damage to your vehicle from events such as theft, fire, earthquake, terrorism etc. is not covered and could result in huge financial losses. Thus it is advisable to buy a comprehensive cover because it provides financial and third party liability protection.

Question 7

What is No Claim Bonus?

Accepted Answer

No Claim Bonus (NCB), as the name suggests, is a reward or bonus from the insured to the policyholder for not making a claim in the preceding years. NCB is a discount ranging from 20-50% on premium payable which cannot be claimed right away but needs to be earned by maintaining a claim-free record.

Question 8

What happens to the accumulated No Claim Bonus at the time of renewal of an expired policy?

Accepted Answer

No Claim Bonus (NCB) carries a validity of 90 days from the policy expiry date. The NCB will become 0 and if the policy is not renewed within 90 days. No benefit shall be passed on to the renewed policy if renewed after 90 days.

Question 9

How can the No Claim Bonus be transferred to a new vehicle?

Accepted Answer

After sale of existing vehicle, a No Claim Bonus reserving letter is issued by the existing Insurer. On the basis of this letter, this benefit is transferred to the new vehicle.

Question 10

How do I renew my expired car insurance policy?

Accepted Answer

After the expiry date Chola MS has a 30-day grace period within which the customer can renew the policy and the NCB will be continued. If the customer wants to renew the policy after the 30-day grace period, s/he should call the Toll Free Number 1800-208-5544 (in India) where the Customer care personnel will guide the customer through the Break-in vehicle inspection app, post which the renewal process will be initiated.

Question 11

What is the process for transfer of insurance?

Accepted Answer

Contact the Insurer with supporting documents - sale deed/form 29/30/NOC of seller, Old RC copy, Transferred RC copy and NCB recovery amount for transfer of insurance.

Question 12

What is IDV?

Accepted Answer

IDV or Insured Declared Value is the current market value of your car. For instance if the purchase price of your car is Rs. 8 lakhs, its value after a year will certainly be less because a car is a depreciating asset. Once you start using your car, its worth also decreases due to regular use, wear and tear. Thus after a year its value will be around Rs. 6.40 lakhs. This amount (the current market value) is called the IDV of the car. IDV is the maximum Sum Assured determined by the insurer and given to the policyholder on damage/loss or theft of the car.

Question 13

Which parameters are considered in IDV calculation?

Accepted Answer

The following parameters are taken into account for IDV calculation - Vehicle’s Age, Manufacturer, Make, Model of the Vehicle and City/Vehicle Registration Details.

Question 14

Why is IDV important?

Accepted Answer

IDV is important in determining the premium amount. The IDV of a vehicle usually falls within a certain range based on the vehicle’s ex-showroom price. Thus it is important to know the IDV for your vehicle to ensure you pay the correct premium amount. In the event of an accident, damage, theft you might receive a lot less than is due if the IDV is incorrect. Make sure the IDV is correctly stated for accuracy of sum assured.

Question 15

What are the additional benefits of buying car insurance online?

Accepted Answer

Zero paperwork and physical documentation and your policy is delivered instantly to you.

Question 16

What happens to the insurance policy when you sell your car?

Accepted Answer

The existing insurance policy can be transferred to the buyer by passing an endorsement under the existing policy. Supporting documents required for this process include - sale deed/form 29/30/NOC of seller/NCB recovery. You can also cancel the existing policy. Supporting documents like sale deed/form 29/30 are required to cancel the policy.

Question 17

How can I register a new claim if I have a Chola MS Car Insurance policy?

Accepted Answer

You may register a claim either on Chola MS’ website or through the call centre using the Toll Free Number 1800-208-5544 (in India).

Parts	Depreciation Rate
Rubber, nylon, plastic parts, and batteries	50%
Fiberglass components	30%
Wooden parts	1st year - 5%,2nd year - 10% and so on

Basis	Zero Depreciation Car Insurance	Comprehensive Car Insurance
Car’s Age	Covers cars aged 5 years or less	Covers cars older than 5 years but less than 15 years
Premium Rate	Relatively High	Relatively Low
Claim Settlement	Offers full settlement coverage and depreciation will not make a dent	Claim amount is based on the current value of the vehicle, which factors in depreciation
Repair cost plastic fiber	Insurer bears the cost	Insured has to shell out money

Zero Depreciation Car Insurance

The following events and situations are not covered under this policy -

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