Insurance is a written contract between two parties’ policyholders and insurance companies in which insurance companies provide protection from losses or reimburse the losses in the form of claims. Insurance companies insured the property, wealth, or life of an individual against insured value from losses. There are many kinds of insurance like life insurance, marine insurance, or general insurance.
Vehicle insurance is one of the parts of general insurance under which various vehicles are covered like car insurance is one of the examples. Under car insurance, insurance company insured our property from accidental risk or risk from natural factors.
Features of car insurance
There are various features of car insurance. Car insurance related to ownership of the car. If you take a policy, then the premium is a recurring expense but cover huge losses of owners. Cheap car insurance offers every type of help to the individual in the form of protection from losses.
Following are the basic features of car insurance:-
- Protection from losses: Risk affect the vehicles in many forms like natural disasters(flood, earthquake, storm or hurricane), man-made disaster(like theft, striking, keying, etc) or risk on road from accident. The insurance covers all these types of risks and protects our physical property from loss. It also provides financial protection to us.
- Premium: The policy is taken by policyholders against the consideration. Consideration is paid by the policyholder to an insurance company in the form of cash premium or any other form. Premium value considers the vehicle type, model, age, capacity or fuel consumption, etc., a city in which you reside, modification if any, policyholder age and occupation, etc. The premium value is calculated by taking into consideration the above-mentioned factors.
- Types of policies: The car insurance company offers various types of policies. There are major two types of policies basic policy or comprehensive policy. Each has its advantages and benefits. You take the policy according to your preference. The basic policy covers the risk from the collision and comprehensive cover all the risk from collision or non-collision.
- Insured value: Every policy has some insured value. Policyholder insured their property against some insured value based upon the manufacturing value also consider the value of depreciation. Premium is calculated as manufacturing price minus depreciation. It also considers the vehicle age because the new vehicle has more insured value and old vehicles have less insured value.
- No-claim bonus: Mostly cheap car insurance companies offer a no-claim bonus facility. This means that if you didn’t claim against your last or previous policy then the company offers a discount to you in the next policy. Thus you save premium in the form of a discount. This value of discount increases year by year if you didn’t claim in any year.
- Additional features: cheap car insurance policies offer many other additional features to the policyholder. Some of these add-on features are like no claim bonus, zero depreciation, full information availability, online insurance, customer services, etc.
- Deductible: car insurance policies are deductible. It means that if you claim against uncertain event then the company pay for damages and balance amount in cash form if any.
- About the author:
- Tejas Maheta is the Founder of com and a tech geek. Besides blogging he love reading books, Learning new things, and Hanging out with friends.