EV Motor Insurance: With increasing interest in EVs, the motor insurance industry is also developing and providing safety cover to car owners through better schemes.
India’s automobile industry is going through a major transformation. In this, the craze of EV or electric vehicles is increasing rapidly. The demand for EV is increasing rapidly. Every automobile company is launching different segment models of EVs in the market. A recent report on India’s EV ecosystem indicates that the EV market is still in its early stages. Its market is expected to grow at a CAGR of 43.13% between 2019 and 2030. With increasing interest in EVs, the motor insurance industry is also developing and providing safety cover to car owners through better schemes.
Ashwini Dubey, Head (Motor Insurance Renewals), Policybazaar.com, says that the interest of people in EVs is increasing rapidly. In view of this, the companies providing motor insurance are bringing products with better coverage. Electric vehicles also need to be fully insured as they also carry risks like other vehicles on the road. However, due to this new category of automobiles, car owners often have many questions and concerns regarding their insurance. Therefore, to strengthen the safety of your electric vehicle, it is important to understand and know about the other riders before choosing any policy.
Understand coverage for your electric vehicle
Ashwini Dubey says, electric vehicles work on batteries operated through one or more electric motors instead of internal combustion engines. While, EVs can be hybrid or they can be fully electric, their insurance is similar to that of a regular motor insurance policy. Third party cover is also necessary for electric vehicles. Considering the advanced technology and high maintenance, the cost of EV insurance is higher as compared to the regular policy. However, to reduce this cost, the insurance regulator IRDAI had also mandated a 15% discount on third-party insurance cover to make electric vehicles more affordable.
He says, when it comes to car safety, it is generally better to take comprehensive coverage. Apart from third party liability, a comprehensive policy is the best option to protect your car from serious risks and damages to yourself. Also, if an EV happens to be in an accident, then the cost of its spare parts, repairs etc. can be high. Hence it is always advisable to take extra precautions to ensure maximum safety.
Select the required add-ons for EV
While taking a motor insurance policy for an EV, some important add-ons should also be included in it. This gives you extra protection.
Zero depreciation cover
The depreciation of your vehicle starts from the time you buy it and bring it home. This continues for years after you drive the car. Your insurance will not be liable for depreciation at the time of claim and will pay the claim amount only after deducting the depreciation cost. Adding zero depreciation or bumper-to-bumper cover will help you save on this cost at the time of claim settlement and will also include the depreciation cost.
Invoice cover
Coming to the depreciation, this is another rider that will help you get a higher amount at the time of claim. As the name suggests, this cover helps you to get the original price or invoice value of your car in case of total loss. Generally, the policyholder gets only the market value of the vehicle, which is less than the price paid for it. This add-on protects you from the risk of total loss of the vehicle.
Roadside assistance cover
This rider is very useful in cases where you may need help due to a vehicle breakdown in the middle of the road. Since electric vehicles are on a completely new concept. So not every roadside mechanic can be of much help in such situations. The better option is to leave your vehicle only in sure hands, and this rider ensures that you get expert help on the spot when you need it.
NCB cover
Often referred to as the easiest and safest way to save on motor insurance premium, NCB or no-claim bonus. This is the reward you get for driving well. It is assessed on the basis of claims. If you do not make any claim, your bonus remains intact and you can avail 40-50% discount for 5 consecutive claim free policy years. This is a very beneficial add-on, especially if you are an experienced and safe driver.
What are the types of motor insurance coverage
Third Party Motor Insurance Policy
Ashwini Dubey says, this motor insurance policy is mandatory by law. This is commonly known as third party insurance. Designed in the owner’s favour, it protects against legal liabilities due to third party vehicle damage, personal belongings, physical damage caused by your car. Driving without this policy is illegal. There is a provision of penalty in this. It is a basic insurance policy, hence, it has a very low premium. For example, for a car with engine less than 1000 cc, many policies are available at a premium of Rs 2094 and later the premium increases depending on the size of the engine.
Own Damage Automobile Insurance Policy
According to Dubey, own damage car insurance policy is very beneficial. This is because it protects you from damage caused to your vehicle due to accidents like fire, theft, flood, earthquake. Moreover, it reduces the financial pressure as it involves the cost of repairing or replacing the car parts damaged in the accident.
Another favorable feature of this policy is that it protects the insured vehicle from damage due to accidents like riots, terrorist attacks. However, there is a high premium to be paid for this facility. It can only be bought with third-party motor insurance. This cannot be taken as a standalone policy by the car owner. If the customer already has an existing third party policy, he/she will have to purchase a standalone own damage policy. It is mandatory to have a valid third party policy while buying a Standalone Own Damage policy.
Comprehensive Car Insurance Policy
Experts say, a comprehensive car insurance policy provides end-to-end coverage. Because it covers both third party liabilities and your own loss. In addition, the policyholder can make the policy even better by adding suitable riders. Some of these are zero depreciation. This saves a lot. Apart from this, there are add-on covers like an engine protector cover, consumables cover, and passenger liability cover, which give safety to you and all other passengers in the motorcar.
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