- Liability Only Policy or Third-party Insurance: This type of car insurance policy covers the damages occurred to a third-party in any adverse condition. It is mandatory as per the Indian law for every vehicle to have a third-party insurance policy so as to at least cover the expenses of injuries caused by one's car to another person or vehicle. In this policy, the premium is calculated on the basis of the engine capacity of the car an individual drives. Since there are only third-party damage cover in the policy, therefore, its premium amounts to much less as against the full coverage policy.
- Package Policy or Comprehensive Insurance: This type of car insurance policy completely differentiates from the third-party insurance, and covers the damage expensed caused to others as well as the vehicle owner. The damage covers and medical expenditure in case of an unexpected occurrence are covered in this policy for both the parties.
In case a person opts for new models, he/she would like to opt for car finance as well as insurance instantly so as to prevent the excess money being shed from their pocket. New cars these days are available with lucrative insurance scheme but people are always in a bid to reduce their premium. To do the same, they can decide on the following aspects before choosing an insurance plan:
- In case people buying new cars decide to get them financed, then they should first analyse their expenses to know if they are able to pay extra premium or a minimum amount for the insurance.
- Depending upon the types of situation people want their insurance to cover, they can get the policies customised as per their convenience. Most of the people tend to go for all-coverage package, which includes medical expenses and the range of damages, which can occur to both parties.
Comprehensive car insurance in India might result in lower premiums after a while as any vehicle depreciates after a certain period of time. The third-party policy, on the other hand, will not be affected as the engine of new models as well as used cars will always remain the same.