Picking car insurance policy solely based on the lowest premium is not a good idea.
The lowest premium policy may not adequately cover some important add-ons like personal accident cover for co-passengers.
The best car insurance policy is the one that gives the maximum cover for an affordable premium.
I have listed the best car insurance companies and policies in this article. Before jumping on to that – first let us understand the types of car insurances available, things to watch out before purchasing a policy and factors affecting the insurance premium.
Type of Car Insurance
Two types of car insurance policy
- Third-Party Car Insurance and
- Comprehensive Car Insurance
#1. Third-Party Car Insurance
Third-party car insurance covers you against legal liabilities and property damages caused to the third-party in case of an accident caused by your fault.
Means, the insurance company will help you pay all the compensation and damages which you are liable to pay to the third-party.
But will not cover you or the car for the damages suffered.
#2. Comprehensive Car Insurance
The comprehensive car insurance policy additionally covers you and the vehicle in case of an accident.
Plus also cover damages caused by fire, theft, an act of social unarrest like riots and vandalism.
In addition to the above, comprehensive car insurance will also cover damages caused by falling objects like tree branches or from damages occurring from severe weather and natural disasters like cyclone, floods or earthquakes.
5 Best Car Insurance Company in India 2021
#1. Royal Sundaram General Insurance
Royal Sundaram is the only insurer that gives free flat tyre, emergency fuel delivery and roadside assistance services. Royal Sundaram has a network for 3300+ garage pan India.
The incurred claim ratio is healthy at 84.99%.
#2. Tata Aig Insurance
Tata AIG insurance has tie-ups with 3000+ workshops network in India. The insurer covers accidental damage or loss of the insured car.
The incurred claim ratio is at 79.31%.
#3. HDFC Ergo
HDFC Ergo has tie-ups with 6800+ cashless garage network pan India. The insurer provides overnight car repair services in case of minor accidental damages.
The incurred claim ratio is healthy at 84.37% and has an online claim initiation facility via QR code.
#4. Bharti Axa
Bharti AXA has a network of 2500+ garages for assistance and free policy remainder facility. Bharti AXA gives additional addon for ambulance charges, medical expenses of Rs. 10,000 and hospital cash.
The incurred claim ratio is 81.74%.
#5. The New India Assurance
The New India Assurance Co is “AAA/Stable” rated one of the oldest government insurance company with widespread reach.
The incurred claim ratio is 79.68%.
Best Car Insurance Policy in India for 2021
#1. Tata AIG Car Insurance
Tata AIG offers flexibility to customize the car insurance policy as per the requirements. The best part is that Tata AIG even lets you retain nonclaim bonus even after selling the car.
Tata AIG Car Insurance Incurred Claim Ratio for Motor – 68.62%
Tata AIG Best Car Insurance Plan
- Tata AIG has only one plan – Auto Secure – Private Car package policy.
- Loss or damage to the vehicle insured
- Liabilities to third parties
- Personal Accident cover for owner-driver
Optional Add on Covers
- Depreciation Reimbursement
- Roadside assistance
- Courtesy Hire Car or Daily Allowance
- No Claim bonus protection
- Repair of glass, fiber, plastic and rubber parts
- Loss of personal belongings
- Key replacement
- Engine & Tyre Secure
- Consumable expenses
- Emergency transport and hotel expenses
- Flexibility to customize car insurance
- Can retain nonclaim bonus even after selling the car
- A long list to choose add-ons
- Low incurred claim ratio
#2. Royal Sundaram Car Insurance
Royal Sundaram is the only insurer that gives free flat tyre, emergency fuel delivery and roadside assistance services. Royal Sundaram has a network for 3300+ garage pan in India.
The insures provides various discounts like
- Discounts of Rs. 100 if opted for a reduction in limits for third party property damage
- 35% discount when opting for a voluntary deductible of Rs. 15000.
Royal Sundaram Car Insurance Incurred Claim Ratio for Motor – 84.99%
Royal Sundaram Best Car Insurance Plan
- Royal Sundaram car shield comprehensive package policy
Car Insurance Policy Coverages include
- Loss or damage protection
- Unlimited third party liability
- Personal Accident cover for owner-driver, the paid driver and car occupants
- Legal liabilities to paid driver and employees
- Cover for electrical, non-electrical and electronic fittings
- Cover for CNG-Kit and BI-fuel system
Add on Covers
- Depreciation waiver
- Voluntary deductible cover
- Loss of baggage cover
- NCB protector
- Tyre cover
- Windshield Glass cover
- Full Invoice price insurance cover
- Spare car clause
- Key replacement cover
- Lifetime road tax clause
- Free emergency fuel delivery, roadside and flat tyre service
- Higher incurred claim ratio
- A host of additional and addon cover
- Discount only when opting for a higher amount of deductible
#3. HDFC ERGO Car Insurance
HDFC Ergo has tie-ups with 6800+ cashless garage network pan India for easy and fast repairs. You would get overnight car repair services in case of minor accidental damages at 13 cities.
HDFC Ergo has online claim initiation facility via QR code. Further, the insurer has 24 x 7 customer support is rated iAAA by ICRA Ratings.
HDFC Ergo Car Insurance Incurred Claim Ratio for Motor – 84.37%
HDFC Ergo Best Car Insurance Plan
- HDFC Ergo Single Year Comprehensive Car Insurance
- HDFC Ergo Long Term Comprehensive Car Insurance
- HDFC Ergo Third-party Liability Car Insurance
- Accidental damage
- Theft
- Damage due to fire
- Damage due to natural disaster
- Personal Accident cover
- Damage to third party vehicle and personal injury
Optional Add on Covers
- Zero Depreciation
- Emergency Assistance Cover
- No claim bonus protection
- Return to Invoice
- Engine and gearbox protection
- Key replacement cover
- Cost of consumable items
- Loss of use – downtime protection
- 6800+ cashless garage network
- Overnight car repair services
- Online claim initiation facility via QR code
- Fewer branches
#4. Bharti AXA Car Insurance
You can buy and renew Bharti AXA insurance hassle-free through online. The insurer has a policy renewal reminder facility and a network of 2500+ garages for assistance.
The best part of Bharti AXA car insurance is the additional addon to choose for accidents like ambulance charges, medical expenses of Rs. 10,000 and hospital cash.
Hospital cash addon helps with Rs. 1000 cash every day up to 30 days of hospitalization.
Bharti AXA Car Insurance Incurred Claim Ratio for Motor – 81.74%
Bharti AXA Best Car Insurance Plan
- Third party car insurance policy
- Comprehensive car insurance policy
- Accidental damage to the vehicle
- Liabilities to third parties
- Loss or damage to electrical and non-electrical accessories
- Personal accident cover for the insured and any named or unnamed passenger
- Legal liability to a person employed
Add on Covers
- Zero depreciation cover
- Roadside assistance cover
- Invoice Price cover
- Medical expenses
- Key replacement
- Consumables cover
- Hospital cash
- Engine and gearbox cover
- Ambulance charges
- Add-ons for ambulance charges, medical expenses
- Hospital cash of Rs. 1000 per day
- High incurred claim ratio
- Fewer network garages
#5. The New India Assurance Co. Ltd. Car Insurance
The New India Assurance Co is a government insurance company and is rated “AAA/Stable” by CRISIL. The insurer is one of the oldest in business and has widespread reach.
New India Assurance Co. Ltd Car Insurance Incurred Claim Ratio for Motor – 79.68%
New India Assurance Co. Ltd Best Car Insurance Plan
- Liability only policy – Which is a third party liability for bodily injury or death and property damage. The policy also includes personal- accident cover for owner-driver.
- Private Car Motor insurance policy – Which covers loss or damage to the vehicle insured including the liability only policy.
- Loss or damage to the vehicle insured and the accessories due to natural calamities and social unrest
- Liabilities to third parties
- Personal Accident cover for owner-driver
Optional Add on Covers
- Loss or damage to accessories such as stereos, fans and ACs
- Personal accident cover for co-passengers and paid driver.
- Legal liability to employees
- Widespread reach with branches in all cities
- AAA rated insurer
- Add on include legal liability to employees
- Slow insurance and claim process
#6. IFFCO TOKIO Car Insurance
IFFCO Tokio provides unlimited zero depreciation cover on the package car insurance plan. The value auto coverage package plan can be customized with a long list of various add-ons.
The insurer has 4300+ garages for roadside assistance and repairs.
IFFCO Tokio Car Insurance Incurred Claim Ratio for Motor – 79.19%
IFFCO Tokio Best Car Insurance Plan
- Third party coverage
- Value Auto Coverage (Package plan)
- Loss or damage to the vehicle insured
- Liabilities to third parties
- Personal Accident cover for owner-driver
Add on Covers
- Zero depreciation cover
- NO claim bonus protection
- Engine protection
- Return to Invoice
- Roadside assistance
- Garage cash cover
- Key replacement cover
- Windshield glass cover
- Loss of personal belongings
- Consumable cover
- Ambulance and medical expenses addon
- Accident cover for car passengers
- Unlimited zero depreciation cover
- A host of add-on benefits
- Lower incurred claim ratio
#7. National Insurance Company Car Insurance
National Insurance is the oldest insurance company with the highest incurred claim ratio. Which may be due to payment of pending claims but in general indicates a healthy claim process.
The drawback is that the government insurer has fewer add-ons with no network of garages and no roadside assistance.
National Insurance Company Car Insurance Incurred Claim Ratio for Motor – 121.67%.
The high ICR is due to the old pending claims.
National Insurance Company Best Car Insurance Plan
- National Insurance Liability-only cover
- National Insurance Package cover
- Loss or damage to the vehicle insured
- Liabilities to third parties
- Personal Accident cover for owner-driver
Add on Covers
- For loss of accessories
- Legal liability to paid driver
- Personal accidents cover to the occupants
- Voluntary consumables cover
- Highest incurred claim ratio
- No network of garages or roadside assistance
#8. United India Car Insurance
United India allows changing of a vehicle while continuing on the same policy with revision in premium. The insurer has add-ons for the fiberglass fuel tank.
United India has higher incurred claim ratio. The drawback is no network of garages for repairs and fewer add-ons.
United India Car Insurance Incurred Claim Ratio for Motor – 91.72%
United India Best Car Insurance Plan
- United India Motor Package Policy
- United India Liability Only Policy
- Loss or damage to the vehicle insured
- Loss of damage to accessories by burglary, housebreaking or theft
- Liabilities to third parties
- Personal Accident cover for owner-driver
Add on Covers
- Extension of geographical cover
- Personal accident cover for named and unnamed person
- Addon for electrical and electronic fittings
- Addon for CNG/LPG bi-fuel kits
- Addon for fiberglass fuel tank
- Higher incurred claim ratio
- Change of vehicle while continuing on the same policy
- No network of garages
- Slow processing
#9. ICICI Lombard Car Insurance
ICICI Lombard gives a facility to get policy details on WhatsApp while purchasing new car insurance. The good part is the instant online policy purchase with minimal paperwork.
ICICI gives an option for mobile self-inspection of the car for online car insurance. Further, ICICI Lombard has 3500+ network garages with six-month quality assurance on repairs.
ICICI Lombard Car Insurance Incurred Claim Ratio for Motor – 77.44%
ICICI Lombard Best Car Insurance Plan
- ICICI Lombard Private Car Package Policy
- Loss or damage to the vehicle against natural calamities
- Loss or damage to the vehicle against man-made calamities
- Third party legal liabilities
- Personal Accident cover
Add on Covers
- Personal accident cover of owner-driver and for passengers
- Engine cover
- Zero depreciation cover
- Return to invoice cover
- Roadside assistance cover
- Consumable cover
- Loss assessment survey within 4 hours
- Online policy purchase with minimal paperwork.
- Fewer package insurance add-ons
#10. Oriental Car Insurance
Oriental Insurance provides free emergency services in case of a breakdown in the state of Delhi & NCR, Punjab, Haryana, Himachal Pradesh, Rajasthan, All southern states, Mumbai and Kolkata.
The insurer also gives alternative car benefit for 5, 10, or 15 days. The other unique addon is the loss of personal effects up to Rs. 10,000. Which is on personal belongings except for money, credit cards, laptops and mobiles.
Oriental Car Insurance Incurred Claim Ratio for Motor – 68.19%
Oriental Best Car Insurance Plan
- Oriental Private Car Package Policy
- Accidental Loss of or damage to the vehicle
- Liabilities to third parties
- Personal accident cover to owner-driver
- Various add-ons on covers on extra premium
Add on Covers
- NIL depreciation cover
- Loss of personal effects
- Alternative car benefit
- The free benefit of emergency services
- Free emergency services
- Loss of personal effects covers up to Rs. 10,000
- Addon for ambulance charges cover
- No network of garages
- Low incurred claim ratio
#11. Bajaj Allianz Car Insurance
Bajaj Allianz has a quick and easy online facility to buy or renew a car insurance policy. The USP of the insurer is the cashless claim settlement facility with over 4000 preferred garages across the country.
Bajaj Allianz offers unique “Motor on the Spot (Motor OTS)”, a mobile-based Insurance wallet claim settlement app. In case of minor accidents, you can self inspect the car and through the app can file claims up to Rs. 20,000.
The 24 x 7 roadside assistance, towing facility in the event of breakdown or accident and lock and key replacement cover are the other benefits. You can even transfer up to 50% of your existing NCB from any other car insurance provider
Bajaj Allianz Car Insurance Incurred Claim Ratio for Motor – 62.20%
Bajaj Allianz Best Car Insurance Plan
| Best Value Plan |
Standard Value Plan |
Flexible Plan |
|
| Premium Cost | Low | Regular | Enhanced |
| Coverage | Low | Regular | Enhanced |
| Own damage premium | Low | Regular | Enhanced |
| Basic Third-party liability | Yes | Yes | Yes |
| PA cover for owner/driver |
Yes | Yes | Yes |
| Cover for electrical accessories |
Optional | Optional | Optional |
| Cover for non-electrical accessories |
Optional | Optional | Optional |
| PA cover for co-passengers |
Optional | Optional | Optional |
| CNG kit coverage | Optional | Optional | Optional |
| Driver coverage | Optional | Optional | Optional |
| NCB discount | Optional | Optional | Optional |
| Voluntary deductible | Optional | No | Optional |
| Depreciation Shield | No | No | Yes |
| Engine protector | No | No | Yes |
| Roadside assistance | Yes | Yes | Yes |
- Loss or damage due to natural calamities
- Loss or damage against man-made calamities
- Rs. 2 Lac of personal accident cover for the owner-driver
- Third party legal liability
Optional Add on Covers
- 24 x 7 Spot Assistance
- Lock & Key replacement cover
- Accident Shield for passengers
- Consumable expenses following an accident
- Per day conveyance benefit
- Indemnification in case of personal baggage loss
- Cashless settlement at 4000 garages pan India
- Motor OTS App for minor accidents
- Transfer 50% of the previous NCB with a different insurer
- Low incurred claim ratio
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Benefits of Having a Car Insurance
- Ensures that the damages to the third-party are paid by the insurance company.
- Covers loss or damage caused to the car against accident, man-made disasters, natural calamities, loss of life of owner-driver.
- Roadside assistance, towing and repairs of vehicles in case of damages due to accidents.
- Savings time on finding reliable garages and claim settlements.
- Availability of host of add on covers to protect, driver, co-passenger and car.
- Benefits to family and survivors in case of death due to the accident.
- Take care of hospitalization expenses thereby lowering financial liability to that extent.
- Pays for expenses like funeral expenses in case of death.
Things to Consider While Buying Best Car Insurance Policy in India
1. Type of Insurance Policy
Comprehensive car insurance is a good option for new and luxury cars purchased on loans. For lower-priced cars you can consider only the third-party fire and theft coverage.
2. Details of Insurance Company
The insurance company should be registered with IRDA. One should look for reliable insurance companies with good financial standing.
Also check, the number of years in operation, claim settlement ratio and how they deal with non-claim issues. Further, you should look for transparency in process flow related to documentation, purchase, claim initiation and settlement.
3. The Premium of Different Companies
Price or premium is the biggest factor. Compare the premium and the cover offered by various companies. The details are usually available online at the company website or with web aggregators like policybazaar.com or comparepolicy.com.
4. Check Deductibles
Premium and deductibles are related. The higher the deductibles the lower will be the premium. However, in case of accidents, you will have to pay a higher amount.
5. Sufficient Coverage
Check all the covers offered in a particular policy. Please, note that irrelevant coverages increase the premium, whereas insufficient coverage defeats the purpose of insurance.
Make sure that you are neither under-covered nor over-covered.
6. Customizations, Add on covers and Discounts
Private insurers offer the option to pick features and benefits suited to unique individual needs.
Insurance companies also provide various add on covers like zero depreciation cover, roadside assistance cover, personal accident cover, no claim bonus, engine & electronic circuit cover, key replacement etc.
Check for such flexibility, add-ons and any other discounts offered by the insurance companies.
In short, keep in mind the following
- Type of Insurance Policy
- Details of Insurance Company
- The Premium of Different Companies
- Check Deductibles
- Sufficient Coverage
- Customizations, Add on covers and Discounts
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Factors Affecting Your Car Insurance Premium
Car insurance premiums depend on the risk which the insurance company is willing to take. The risk factors which decides the premium are related to car, location and the individual driving the car.
1. Policy Type
Comprehensive car insurance offers greater coverage and hence has a higher premium when compared to third-party car insurance.
2. Model of the Car
Different models of car from the same manufacturer have a different premium, for example, Dzire LXI has a different policy premium than Dzire VXI.
3. Engine Capacity
Higher the cubic capacity (CC) of the car’s engine higher will be the insurance premium amount.
4. Age of the Vehicle
The insured declared value of the vehicle reduces with each passing year this is due to depreciation. Lower the insured declared value lower is the premium charged.
Therefore, the new cars having higher insured declared value have higher premiums as compared to older cars.
5. Fuel Used
The car insurance premium is different for diesel, petrol and CNG variants. For example third-party premium for CNG is Rs. 60 more than the petrol variant.
The different insurance company charges a different premium for different fuel type. Usually, diesel cars have 10 to 15% higher premium than petrol cars.
6. Installations of Anti-Theft Devices
ARAI approved anti-theft devices sounds alarms or immobilizes car ignition which reduces chances of theft. Insurers offer 2.5% discounts on premium when you purchase car fitted with anti-theft devices.
The maximum discount is Rs. 500.
7. Location of RTO Office
RTO offices are categorized into Zone A and B.
Zone A has metro cities like Ahmedabad, Bengaluru, Chennai, Delhi, Hyderabad, Kolkata, Mumbai and Pune where the premium is slightly higher than Zone B comprising of other cities.
This is because the metro cities have higher traffic and the chances of accidents are higher.
8. Age and Occupation of the Policy Holder
The premium can be lesser for a certain age group. Like some insurance companies offer discounts to experienced drivers aged between 35 to 45 years.
Further, IRDA offers discounts to teachers, government employees, military personnel and chartered accountants.
9. Driving History
A good driving habit can earn you a no-claim bonus.
Additional discounts on premium in the form of no-claim bonuses are offered with each claim-free year. With cumulative discounts, you will be required to pay lesser premiums for later years.
10. Choosing Voluntary Deductibles
Picking deductibles will lower the premium as you will be required to pay for damages to the car in case of an accident.
I keep updating my articles based on the feedback I got from my readers. So share your queries & feedback in the comments.
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