INSURANCE FAQ's

A third party car insurance policy is mandated by the Motor Vehicles Act. This car policy covers your financial liability if your car harms any third party or property. The policy covers accidental injuries caused by third parties, death, and damages caused to third party property.

Comprehensive car insurance policy covers third-party liability and also any damages suffered by the car. It pays the financial liability against aggrieved third parties. Moreover, if the car also suffers damages, the repair costs are paid.

Car insurance plans are available for a term of 1 year. After this period you have to do car insurance renewal to continue the coverage.

IDV stands for Insured Declared Value. It depicts the market value of the car after being adjusted for depreciation. Thus, the IDV is calculated as the car’s market value less depreciation. IDV is the maximum liability of the insurance company and it represents the sum insured of a car insurance policy.

Yes, if you do not make a car insurance claim in any policy year, you get a No Claim Discount (NCD). This discount reduces the subsequent year’s renewal premium. NCDs are cumulative in nature. They increase with every claim-free year. The applicable NCDs are as follows –

Yes, there are various add-ons available under comprehensive car insurance plans. Some popular add-ons include the following –

• Zero depreciation cover – this add-on nullifies the financial effect of depreciation on your car’s parts and enables you to receive a higher claim from the insurance company.
• NCB protect – though you earn a No Claim Discount for each successive claim-free year, the entire discount is lost if you make a claim. This add-on protects your discount from being lost even after a claim.
• Engine protect – this cover covers engine damages which are otherwise excluded from the plan.
• Return to invoice – this add-on covers the difference between the IDV of the car and its invoice value and helps in higher claim settlement.

Premiums for a third party policy are fixed by the IRDA (Insurance Regulatory Development Authority). However, car insurance price for a comprehensive policy is calculated on various factors. Some of these factors are as follows –

• Make, Model and Variant of the Car (MMV)
• IDV (Insured Declared Value)
• Available discounts
• Voluntary deductible
• Voluntary deductible

A health plan can settle you claims in two ways – cashless and reimbursement. Cashless claims are those under which you have to get admitted to a networked hospital. Thereafter, your medical bills are paid directly by the insurance company. Under reimbursement claims, you pay your medical bills yourself. After being discharged from the hospital you submit the medical bills and the company reimburses you for the costs incurred.

Premiums paid for a health plan are tax-free under Section 80D of the Income Tax Act. The limit of tax exemption is Rs.25, 000 on premiums paid for yourself and your family. If you are a senior citizen, this limit increases to Rs.30, 000. If you are paying premiums for your parents’ health insurance policy you can claim an additional exemption of Rs.25, 000. This limit also increases to Rs.30, 000 if your parents are senior citizens.

Illnesses and ailments which are already suffering from at the time of buying the policy are called pre-existing illnesses. These illnesses are not covered for the first few years and this period is called the waiting period.

Yes, transferring of health plans from one company to another is possible. This is called porting and can be done by giving a request to the existing insurance company at least 45 days before expiry of the policy.

If there is no claim in a policy year the company rewards you with a No Claim Bonus. This bonus either gives you a premium discount in the next year’s premium or increases your sum insured without increasing the premium.

A Third Party Administrator (TPA) is an intermediary between the insurance company, the policyholder and the hospital. You are required to contact the TPA for making a health insurance claim when you are hospitalized. The TPA sends the claim intimation to the insurance company and gets it approved.

Adults aged 18 years and above are covered under the plan. For dependent children, the minimum age is 91 days and the maximum age is 25 years.

Health insurance plans are renewable lifelong. This means that there is no cover ceasing age. As long as you renew the plan within the stipulated time you can avail coverage for as long as you live.

Hospitalization for at least 24 hours is required to claim health insurance. However, there are some treatments which, due to the development of medical science, do not require 24-hour hospitalization. These treatments are called daycare treatments and they are covered under the plan.

Maternity cover is inbuilt in some health insurance plans but not in all. Under some plans, you can find maternity cover as an add-on benefit which can be taken by paying an additional premium.

There is no limit on the number of claims which you can make in your health insurance plan in one year. However, the insurance company’s maximum liability would be limited to the sum insured which you have selected.