Choosing a car insurance that is perfectly fit to your needs can be a difficult task for many as there are so many options in the market. Comprehensive car insurance and bumper-to-bumper car insurance are the two most popular insurance policies in India. In this blog post, we will explore the key differences between the two insurance policies so that you make an informed decision while you are out in the market purchasing insurance.

What is a Comprehensive Car Insurance?

Comprehensive insurance can be considered as a huge shield that covers various aspects. It goes beyond the basic protection and offers protection against:

• Accidents: Met with an accident? This type of insurance covers the cost of repairs you may need after an accident.
• Theft: It repays you for the vehicle’s insured declared value () if it gets stolen.
• Fire: All the damages that may be caused to your car due to a fire breakout will be covered under this insurance policy
• Natural Disasters: It assists you by covering the cost of damages caused by disasters like floods and earthquakes.
• Riots & Strikes: Damages caused to your car due to these activities are also covered under this insurance.

In addition, you can tweak your insurance policy! Add-on covers are offered by many insurance providers:

• Engine Protect: In case your engine breaks down, this cover helps in covering for the costs of repairs or replacements.
• Return to Invoice: This cover reduces the gap between the vehicle’s current value and its on-road cost during claim settlement.
• Personal Accident Cover (PAC): In case of an accident where either you or the passengers in your car need financial assistance to meet the costs of injuries/hospitalisation, this cover comes to the rescue.

Here is the catch: When parts are replaced after a claim, depreciation (reduction in value due to age) is applied. This implies you might need to pay a portion of the repair and replacement costs from your hand. Also, your car insurance doesn’t cover the wear and tear of the car, electrical/mechanical breakdowns because of negligence, or

Bumper-to-Bumper Insurance: An Upgraded Protection

A supercharged version of comprehensive car insurance is called bumper-to-bumper car insurance. It offers every one of the advantages of comprehensive insurance, however with a significant advantage:

• No Depreciation on Parts: You get the full cost of repairs or replacements for most car parts after an accident, no matter what their age. You will not have to shell out money from your pocket.
• Enhanced Coverage: When compared to comprehensive car insurance, bumper-to-bumper car insurance provides broader coverage. This includes coverage for consumables like ointments and filters utilised during repairs.

Sounds perfect, right? Well, almost. Here are some considerations:

• Higher Premiums: Added security comes at a price. The insurance premiums for bumper-to-bumper car insurance are higher when compared to comprehensive car insurance.
• Renewal Restrictions: Some insurance providers put limits on who can get bumper-to-bumper car insurance, particularly for older cars. Check the renewal terms prior to picking this option.

Choosing Your Champion: Comprehensive vs. Bumper-to-Bumper

Depending on your car’s age and your tolerance of risk, the best choice will differ. Let’s break it down:

• New Cars (Up to 3 Years Old): Depreciation is negligible for new cars. An effective choice for such cars will be opting for comprehensive insurance with add-ons like engine protection and return to the invoice.
• Pre-Owned Cars (3 to 5 Years Old): Depreciation is considered for these cars. Opting for comprehensive insurance with a zero depreciation add-on for parts like engines and headlights is advisable.
• Older Cars (Above 5 Years Old): Depreciation of value can be critical for older cars. As the complete repair costs are covered under a bumper to bumper car insurance, it becomes a more alluring choice for car owners

Conclusion

To maintain your peace of mind and to safeguard your prized possession: your car, it is important that you choose the perfect insurance protection that suits your needs. Once you comprehend the various coverage options and their requirements along with their differences, you can make a well-informed decision and choose the perfect insurance plan that is suited to your needs.

*Terms and conditions apply. The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. You are recommended to obtain specific professional advice from before you take any/refrain from any action. Tax benefits are subject to changes in tax laws. Please contact your tax consultant for an exact calculation of your tax liabilities.| EL/BLOGS/24-25/02