Buying motor insurance can be daunting, especially for first-time buyers who may overlook critical details that could lead to costly mistakes. With India's passenger vehicle market booming—domestic wholesale sales reached 4.30 million units in FY25, up 1.97% from FY24—the need for informed insurance decisions is more crucial than ever.
The motor insurance sector in India, valued at USD 11.39 billion in 2024, is projected to exceed USD 30 billion by 2034, growing at an annual rate of 7.13% to 10.40%. Despite this growth, many buyers remain unaware of essential coverage aspects, often opting for basic third-party insurance without thorough comparison. abhishek Kumar, a registered investment adviser, emphasizes the importance of setting the Insured Declared Value (IDV) based on the car's current market value rather than its sale price, recommending comprehensive coverage over minimal options.
Additionally, add-ons present another layer of complexity. Kumar suggests beneficial add-ons like zero depreciation, engine protection, and roadside assistance, which can mitigate out-of-pocket expenses during emergencies. However, he cautions that some add-ons, such as daily allowances and tyre protection, are often unnecessary and rarely claimed.
Buyers should leverage online insurance aggregator sites to compare policies, adjust their IDV, and choose only essential add-ons. Kumar also underscores the importance of reading the fine print, advising buyers to pay attention to exclusions, deductibles, and claim procedures to safeguard against potential pitfalls.
As car ownership rises and the insurance market rapidly expands, understanding coverage options, add-ons, and policy terms will empower buyers to make informed decisions and protect themselves effectively.
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