Car Insurance Policy - Coverage, Types & Whats Included

What Is a Car Insurance Policy?

A car insurance policy is a legal agreement between a vehicle owner and an insurance company that provides financial protection against damages, losses, or liabilities arising from the use of a car.

In India, owning a valid car insurance policy is mandatory under the Motor Vehicles Act. Policies are designed to protect against third-party liabilities and, depending on the plan, damages to your own vehicle.

What Does a Car Insurance Policy Cover?

Third-party liability for injury, death, or property damage
Damage to your own vehicle due to accidents, fire, theft, or natural calamities
Coverage for man-made risks such as riots or vandalism (comprehensive policies)
Personal accident cover for the owner-driver

Types of Car Insurance Policies in India

Car insurance policies are available in different formats depending on the level of protection you need.

Third-Party Car Insurance Policy – Covers only third-party liabilities
Comprehensive Car Insurance Policy – Covers third-party liability and own-damage
Standalone Own-Damage Policy – Covers vehicle damage without third-party cover

Optional Add-Ons in a Car Insurance Policy

Zero depreciation cover
Engine protection cover
Roadside assistance
Return to invoice cover
Consumables cover

How to Choose the Right Car Insurance Policy

Evaluate how often and where you drive your vehicle
Consider the age and current value of your car
Compare coverage benefits and exclusions carefully
Review claim settlement track record of insurers

What Policyholders Say

I was able to clearly understand what my car insurance policy covers. The explanations helped me choose the right coverage without confusion.

Amit S.

This helped me understand the difference between third-party and comprehensive car insurance policies.

Rahul K.

After reading this, I felt more confident renewing my car insurance policy.

Ankit R.

Car Insurance Policy FAQs

Are add-ons available with car insurance policies?

Yes, add-ons such as zero depreciation and engine protection can be purchased with car insurance policies.

What does a comprehensive car insurance policy cover?

A comprehensive policy covers third-party liabilities and damage to your own vehicle caused by accidents, theft, fire, and natural or man-made events.

Does a car insurance policy cover engine damage?

Engine damage is usually covered only if an engine protection add-on is included in the policy.

Does a car insurance policy cover theft?

Yes, theft is covered under comprehensive and standalone own-damage car insurance policies.

What is a standalone own-damage car insurance policy?

A standalone own-damage policy covers vehicle damage and must be paired with a valid third-party policy.