Byline: Kavita Sriram

People who despise congestion, long queues and long waits, rely less on public transport and more on their own vehicles. Mahesh and his family decided to drive through the night, and spend their vacation in Goa. At around 10 at night, it began to drizzle and visibility

While no one in the car was seriously injured, the car itself had to be towed away. The insurance company will definitely pay for towing and repair expenses. But had he himself died in the accident, what would become of his family? Will the insurance take care of the family in event of disability or loss of life of the breadwinner?

For those who claim to be very safe drivers, it is prudent to remember that one can be involved in an accident for no fault of his. Damages can range from damaged car or damage to public property, to serious physical injury or even death. Automobile insurance and associated covers provide the much-needed financial cushion at times when you need it most.

Third party insurance covers damages caused to third parties. Some of the components included are compensation in the event of death or bodily injury to any person, and damage to property other than those belonging to the insured. With payment of additional premium, it is possible to take unlimited cover for damage to property too.

In case of a comprehensive insurance cover, the company indemnifies the insured against loss or damage to the motor vehicle and its accessories arising from fire, burglary, riot, natural disasters etc.

Personal accident policy or personal injury protection pays for the medical and funeral costs associated with an accident for the insured and his family regardless of whose fault it was. There are some policies that give as much as Rs 20 to 40 lakhs in the event of death or disability. However, keep in mind that premiums in such policies will be on the higher side. Also, if you already have separate health, life and disability policies, you can probably forgo this one altogether.

When you shop for auto insurance, several covers or options are compulsory and some others are not. Opting for the entire package and maximum benefits will send your premiums soaring high up. Hence, consider how much risk you want to cover and select from coverage like bodily injury liability, property damage liability, personal injury protection, uninsured motorist protection, collision and comprehensive cover.

Obtain insurance at the estimated market value of the vehicle. This is determined by the make, model, resale value and the condition of the vehicle. When it comes to claim settlement, the insurance company will only look at the market value of the vehicle. Further, reset the insured value every time you renew your policy as this will enable you to save on the excess premium you would pay.

Finally, bear in mind that even if the vehicle is insured, a cover is deemed invalid when the person at the wheel does not hold a valid driver's license at the time of the accident. If the damage has occurred in war zone or the driver is under the influence of drugs or alcohol the claim can be rejected.