Is Comprehensive Car Insurance Necessary for Older Vehicles?

The experience of owning the same car for several years can be special as it holds long-time memories. This is why it becomes necessary to have a comprehensive car insurance policy in place to protect your car (apart from it being a legal mandate)!

However, there are several factors to consider when you go to buy car insurance, like the car’s make and model, policy coverage, add-ons, premium, and even the car insurance renewal process. Moreover, when it comes to knowing the premium of your car insurance it is wise to use a car insurance premium calculator.

However, all these aspects apply to a comprehensive car insurance policy. So,  is it necessary to have comprehensive car insurance for your old car? Let’s understand.

What is Comprehensive Car Insurance?

In comparison to own damage and third-party and car insurance, this policy offers a wider range of coverage for your car. Comprehensive car insurance provides protection for your car in the case of damages to your four wheeler due to accidents, theft, fire, or natural disasters like floods, earthquakes, etc., covers third-party liability and also provides personal accident cover.

Now let’s see how comprehensive car insurance in India works. According to the motor laws in India, it is mandatory to have valid car insurance.  As per the Motor Act, It is not compulsory to have comprehensive car insurance but having at least third-party insurance is. However comprehensive car insurance is highly recommended as it offers extensive coverage for your car in comparison to third-party car insurance.

 Is Comprehensive Insurance Mandatory for Older Cars?

As per the law, it is mandatory to have third-party insurance for your car, however, it is beneficial to have comprehensive car insurance policy. Here are the reasons why:

1. An older car needs more repairs and replacements in comparison to a new four wheeler. This policy covers all these costs and also the cost of damages caused due to accidents, fire, natural disasters, etc.
2. This policy also compensates the policyholder in the case of the loss of a car/theft. Having a basic third-party policy does not cover this scenario.
3. This policy also covers third-party liabilities in addition to own damage liabilities. This also caters to the law mandate of having third-party insurance for your car.
4. Add-ons like Zero Dep cover are available with this policy. This is very beneficial, especially for an old car, as the market value of the car decreases with time. This policy covers the cost of depreciation.

 Factors to Consider Before Getting Comprehensive Insurance for an Old Car

1. The market value of the older car is lower compared to a new car. Also, as the car’s value decreases over time and the cost of repairs and depreciation may increase hence, comprehensive insurance is favoured. However, many insurers do not issue comprehensive policies if the car’s age is more than 15 years.
2. When buying comprehensive car insurance for your old car, you may come across the term “deductible.” This deductible represents a minor amount subtracted from a claim and requires the policyholder to pay for this amount before the insurer settles the claim.
3. Getting old car comprehensive car insurance in metropolitan cities can be beneficial as your car is more at risk in a metro city in comparison to a non-metro city due to increased traffic and higher cases of theft and accidents.
4. When you own an old car, the emotional factor also has a major impact. When you buy car insurance, policyholders can relax knowing their four-wheeler is well protected under this policy.

 How Age of a Vehicle is a Determinant for Insurance Premium

The age of a car has a major impact on its  insurance premiums. The Insured Declared Value (IDV) uses the number of years of a car for its premium estimation. The higher the age of a four-wheeler, the lower is its value, this also leads to a lower four-wheeler insurance premium.

To determine the impact of these factors, policyholders can use a car insurance premium calculator. This application makes it easy and convenient for policyholders to calculate their car insurance premiums.

All they have to do is fill in basic information about their four-wheeler, such as the year of production, make, and model, and they can get the estimated four-wheeler insurance premium.