A Detailed Guide to Cashless Car Insurance Policy

Published on: 10 November 2020 Last Updated on: 26 October 2023

As a responsible car owner, you must take the utmost care to ensure that you follow all traffic and safety rules. Wearing a seat belt, obeying the traffic laws, maintaining adequate distance between two vehicles, and driving within the speed limit are some of the safety measures. However, even if you follow all rules, there is always a fear of accidents because of numerous vehicles, reckless drivers, and other third-party issues.

An accident can cause significant damage to your vehicle, which may result in huge financial expenses. Hence, in such contingencies, an insurance policy for cars can provide much-needed financial aid. Moreover, it is mandatory to have car insurance in India. If you drive your car without an active car insurance policy, you will be charged a penalty or even imprisoned in certain cases.

Car insurance covers medical expenses, property damage, and even third parties. Compulsory third-party insurance covers the owner or driver of the vehicle against claims for personal injuries caused to other people in a road accident. Car owners can obtain a CTP green slip quote from a reputable insurance provider nearby or online in areas where this insurance is mandatory.

There are different kinds of insurance products available in the market. One of the most popular insurance policies is a cashless car insurance plan. A cashless policy can save you from spending hard cash while extending the requisite financial coverage.

Below is a detailed guide to cashless car insurance:

What is a cashless car insurance policy?

A cashless policy allows you to get your car repaired without making any cash payment. The expense of repairs is borne by the cashless car insurance policy, unlike a general insurance plan where you are liable to pay for expenses and then file for reimbursement. A cashless car insurance plan will include a network of garages where you can get your car fixed without paying any money. This is also inclusive of online 3^rd party car insurance.

What does the cashless car insurance policy cover?

A cashless insurance cover allows you to get your car refurbished without paying any money. The payment is directly settled by the insurer and is included as a part of your insurance contract. However, the policy excludes deductibles and depreciation, which are explained below.

Deductibles: It is the amount that you have to pay while raising a claim. For instance, if you are filing a claim of 20,000 and the deductible is Rs. 2,000. Then, the insurer shall make the payment of Rs. 8,000 subject to other terms and conditions.

There are two types of deductibles, compulsory and voluntary. Both are decided at the time of buying the policy. A compulsory deductible is mandatory, and you are required to pay your component of the final amount at the time of claim. Whereas, a voluntary deductible is what you agree to pay, in addition to the compulsory deductible.

Depreciation: The value of an asset decreases over time due to the use, wear, and tear or obsolesce. Depreciation is the reduction in the value of the car or any of its parts. The insurer deducts the value of depreciation before releasing the payment. Depreciation is calculated according to the life of the asset at the rates listed by the Insurance Regulatory and Development Authority of India (IRDAI).

What is an authorized garage?

An authorized garage forms a part of a network of workshops that have entered into an agreement with the insurance company. Workshops meeting predetermined selection criteria get added to the list of the authorized workshops. They offer cashless repair services for insurance policyholders. The repairs are undertaken by trained mechanics who maintain transparency in the pricing. Moreover, the workshop issues the initial estimate of repair expenses, which is reasonably accurate.

What are the benefits of a cashless policy?

The key advantage of a cashless policy is that the insurance company settles the cost of damages directly with the authorized garage. You need not incur expenses before raising the claim. Hence, there is no financial stress to arrange funds for repair. A good insurance company will have a large network of authorized garages across the country, which further makes the cashless claim process smoother.

How to buy a cashless car insurance policy?

You can purchase a cashless plan by visiting the nearest branch office of your chosen insurance company. The documentation process is simple and quick, but you would need to go to the branch in-person.

Alternatively, you can buy insurance online. Online car insurance India brings in more transparency and convenience in the entire process. Moreover, in the current pandemic situation, the IRDA has abolished the need for submitting the documents or application form in hard copies. The insurer can share the policy document on your registered e-mail ID or mobile number, which shall be treated as a valid physical document.

Overall, given the number of rising accidents today, a comprehensive car insurance policy has become more of a necessity than a choice. If you fear the cumbersome claim process and want an easy way out, buy cashless car insurance online at the convenience of your home. The policy protects your vehicle and also assures your hassle-free settlement at all times.

Read Also:

Essential Reasons for Comparing Car Insurance Quotes Online

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How Digital Advisors have Transformed the Investment Sector

Technology has undoubtedly made a huge impact on our everyday lives. There are new innovations that are unveiled practically every minute and it can be hard to keep up. The rise of the internet has replaced traditional newspapers and other print media as sources of information. Millions of people now rely on online news sources such as Yahoo and Twitter on getting their news. The transportation sector has also transformed from using the yellow cabs to Uber and Taxify. Purchasing of goods and services is now through electronic payments via credit and debit cards. The financial industry has also been affected by this transformation. The rise of digital advisors has resulted in cheaper and more efficient ways of offering financial advice to investors. These offer automated financial planning with different levels of human engagement. An investor will surely appreciate such engagement. The Difference Between Robo Advisor and Digital Advisors: A robo advisor uses algorithms and model portfolios relying on certain information that has been obtained from the client. While others may find robo advisors attractive due to their low cost, there is minimal human interaction. There is more focus on investment allocation but minimal focus on financial planning. Making life’s big decisions such as buying your next house or paying for college requires a lot of careful planning. In this instance, there is no one to hold your hand as you contemplate about making these changes in our life. A digital advisor is a combination of a traditional financial planner and a robot advisor. This affords an investor the ease and convenience of accessing a personal human advisor. These can be reached via phone or chat. The advice offered by digital advisors goes beyond investment options. Since users have real-time access to an actual financial planner, they can talk to someone about their specific needs and work together to come up with a plan that is based on their current situation. Which One is Right? There are Robo advisors who are fully automated and have low fees. These provide investment planning to investors. On the other hand, digital advisors offer a combination of this automation and a touch of the human element. Financial advice is also provided. It is important for you to know how these function so that you know which one to choose if you are considering these options. Here are some options to choose from who are considered the well-known players in this space: Wealthfront: this automated service has over $1 billion in client assets and thus considered the world’s largest investment service. There is very little human interaction. The first $10,000 in assets management do not attract an advisory fee. Amounts that are higher than this attracts a monthly advisory fee at the rate of 0.25%. The minimum investment amount is $5,000. Betterment: there is also very little human interaction on this service. Just like the previous platform, the process if Betterment begins by clients being asked a series of questions and then an investment plan is recommended. A monthly portfolio fee of 0.35% and this amount decreases the more the balance grows. There is no minimum investment. Learnvest: although this platform does not manage investments, clients can contact a Certified Financial planner whom they can contact by phone or email and ask questions. A %19 monthly fee is charged. Personal capital & Wela: these two digital advisors have very similar offerings. For instance, both offer free financial advice to their users. You can receive advice pertaining to all things finance and be assisted to set up a unique game plan based on your specific situation. Users are also free to use all the financial planning tools available at the site at no extra cost. A management fee of less than 1% is charged to users who are connected to a personalized wealth management advisor. A similar program at Wela ensures that a user is charged only when he decides to become a client. If you have your doubts about putting your money with a fully automated system, why not go for a digital advisor that provides you with unlimited access to a financial planner while at the same time providing online convenience so that you are assured if a partner to guide you in making big decisions in life. How They Work: You do not have to rely on a human to discuss your financial goals and expectations. These interactions go on through a website. You will fill out a questionnaire that helps these sites to assess your current financial situation, risk tolerance and goals. The firms will use this information to develop manage and also suggest an asset allocation. Other firms will operate by investing your money in mutual funds and exchange funds. These are passively managed funds. Other firms will be willing to invest in individual stocks although this does not happen so often. Once your portfolio has been constructed the digital advisor will rebalance it on different situations so that you can maintain your target asset allocation. There are some cases where you will not need to fully rely on a digital platform to offer advice. Some elements of the advisor model are mixed with a human advisor. Therefore instead of relying on your response to the given questionnaire, you will be interviewed over the phone or video. You can also access a human advisor via video conferencing. These websites rely on their own algorithms to determine what would be a good fit for you as asset allocation. Depending on the firm, some will be more or less aggressive in their suggestions. Investors have found these websites to be truly valuable in a fast-paced world where many lack the time or interest to manage their own savings or investments. Advanced technology makes it possible for investors to be comfortable in a web-based relationship which assists them to allocate their asset and online portfolios. It has truly changed the way business is done. Read Also: 5 Must-Have Long-Term Goals For A Secure Future How To Become Financially Stable Before Age 30

Is Fixed Deposit the Right Place to Invest Post-Demonetization?

Fixed deposit is an investment option which is balanced with both: Returns and Risks. Although the investment is the most preferred option; these day’s people are seen to be disappointed with its returns. Perhaps the reason behind this disappointment can be the drop down of interest rates post-demonetization. Fixed deposit (FD) is always considered as a much favourable choice than savings since the returns earned are comparatively high. But as the rates have dropped down, the investors might have to think about parking their funds in savings rather than investing it. Before you change your mind, it is important to consider other financial institutions too, who offer fixed deposit investments. Banks are not the only ones providing the fixed deposit service; there are highly reputed NBFCs which are providing it too. The FD offered by the NBFCs are called as company fixed deposit. Despite the repo rate cut down, NBFCs still manage to offer best-fixed deposit rates which are higher than banks. Yes! You read it right, you can earn higher returns by investing in company’s fixed deposit, plus there are many schemes and facilities you can gain from. Owing to the favourable fixed deposit conditions, you no longer need to resort to less interest offering saving options. Here are some things that you should know about fixed deposit investments: 1. Secured Investment: As fixed deposit does not depend upon the market conditions, the interest offered on it is fixed throughout the loan tenure. This makes the investment a safe option to allocate your funds in. Whereas, the returns offered on the high-risk investments depends upon the market conditions which makes them risky. There is no such guarantee that you might always earn higher returns as there can be times when you might face a loss. This is not the case with fixed deposit. Besides, there are some NBFCs who are awarded ICRA’s MAAA rating and CRISIL’s FAAA rating which means, they are reliable as well as safe to invest in. 2. Flexibility: With a safe investment option, fixed deposit also provides flexibility with its tenure. You are free to choose any tenure period ranging from one year to five years. Also, you can reinvest in FD if your account matures. 3. Interest rates: The interest rate is a very important factor to consider when it comes to investments, as it decides the returns you will be earning over the fixed deposit. Fixed deposit interest rate offered by every financial institution differ, which is why it is important to compare FD rates and then apply for it. Also, as mentioned above, investing in NBFC’s fixed deposit can benefit you with higher FD returns in comparison to banks. 4. Tax deduction: In case, if you are investing a lump sum amount and the interest offered on your investment is above INR 10,000, then you might have to pay taxes. To escape from this tax deduction, you can split the money and invest it in different FD accounts. Also, you can apply for Section 80C to benefit from the tax deduction. 5. Senior citizen fixed deposit: If you are a senior citizen, you can benefit here, as you can invest your pension funds and earn higher FD returns compared to normal FD accounts by parking your funds in senior citizen fixed deposit. Although post-demonetization has brought down interest rates on normal FD account, the rates offered on senior citizen fixed deposits have increased. Though rates offered on a fixed deposit have dropped down, investing in a company fixed deposit can earn you higher returns. If you are planning for an investment, then NBFCs such as Bajaj Finserv offers highest Interest on FD Rate as well as provide different schemes and facilities that can benefit you. Read More : How To Get Low Cost Life Insurance For Seniors 10 Tips To Design The Perfect Business Card

How to Select the Best Investment Plan for Your Child?

As parents, you want many things for your child - happiness, health, and a secure financial future. You also want that your child should excel in his/her career. Just imagine your kiddo becoming a star athlete or a budding biologist or a successful entrepreneur who appears in headlines from time to time. Your joy will know no bounds! However, when you want to provide the best of everything to your child, you will have to move beyond the basic parenting skills and contribute to his/her holistic growth. For that purpose, it is sensible to save money for your child’s future and keep him/her financially secure, even in your absence. A good way to start is to invest in an Online Savings Plan, popularly known as ‘Child Investment Plan’. An online savings plan serves the dual purpose of investment and insurance. Most importantly, it fulfils two major requirements: It secures your child’s future financially It provides financial aid at various stages of your child’s life such as higher education, starting a business, or getting married However, with several child investment plans available in the market today, it can become difficult to choose the plan that best meets your child’s needs. Following tips will help you make an informed decision: Determine the Monetary Value Attached to Your Child’s Dreams As a responsible parent, your first step should be identifying and prioritizing your child’s goals and the monetary value attached to them. The two main goals for which you would need significant financial funding is your child’s education and marriage. As far as education is considered, for the time being, decide your child’s goal on behalf him/her and know for sure when the cash is required. Reach a decision, for instance - "I am saving for my son’s engineering degree in 2025, and I may require 20 lakhs for the same". Along these lines, calculate the required funds while taking into consideration the year of the requirement for the respective milestones. Also, with respect to your child’s education, don’t just consider funds for primary and higher education, but also plan for extracurricular activities. In short, make estimates of the amount you intend to spend on your child’s education or marriage. Doing so will help you choose the premium amount and the policy term for the best child investment plan. Go for Equity-linked Online Saving Plans If you have a higher risk appetite for equities and a considerable investment time frame (more than 10 years), you can consider opting for an online savings plan. It is essentially a unit-linked child investment plan that offers you investment as well as insurance feature in a single product. Further, this plan provides multiple investment options like equity, debt and balanced funds. So, if you have a longer investment timeframe, you can go for equity funds as investing in equities for longer duration gives the best returns. On the other hand, if you have a lower appetite, you can go for an online savings plan that offers a balanced mix of growth and debt funds. Remember that just choosing to invest for your child is not enough. Selecting the right investment plan is most important! Therefore, while making your investment decision consider the amount you can spare for investment, your income, cost of higher education, time in hand, and the level of risk. Look for Premium Waiver Benefit Almost all insurers, including Max Life Insurance, offer child plans with premium waiver benefit as a key feature of the base plan. This benefit acts as the most vital feature in case of demise of the parent. In such a situation, the child plan pays a lump sum amount to the nominee. Further, the insurer waives off all future premium, and the plan continues to be active until the entire policy term. This ensures that the maturity benefit remains intact as planned. Check for Provision of Partial Withdrawals Online saving plans also allow partial withdrawals on fixed intervals. The idea behind such partial withdrawals is to allow parents to meet the financial needs of their kids at the key milestones in their life such as admissions for extracurricular activities, admissions in educational institutions, or marriage. This option is also helpful for meeting unplanned expenses in case of medical emergencies. Other Factors to Consider for Child Investment Planning Start investing early. It will help achieve your investment target easily. Also, ‘Power of Compounding’ will play an important role when it comes to investing for your child’s future Know the different premium payment modes. You can opt to pay premiums on monthly, quarterly, half-yearly or annual basis Invest in a plan that offers a well-balanced mix of equity and debt funds Track your investment at regular intervals and make appropriate changes if required Select a tax-efficient investment option Concluding Today many insurers have come up with attractive child investment plans. However, you need to be judicious about what plan you want to opt for. Also, while making your decision don’t forget to consider criteria like time horizon and age of your child. We hope that this guide will help you choose the right plan for your child and make his or her dreams a reality! Read Also: Investing And Trading 101: Investment Ideas For Newbies How Digital Advisors Have Transformed The Investment Sector Pros And Cons Of Oil And Gas Investment

A Detailed Guide to Cashless Car Insurance Policy

What is a cashless car insurance policy?

What does the cashless car insurance policy cover?

What is an authorized garage?

What are the benefits of a cashless policy?

How to buy a cashless car insurance policy?

Essential Reasons for Comparing Car Insurance Quotes Online

Bankruptcy Means Test: Why It Matters?

Content Rally

Content Rally wrapped around an online publication where you can publish your own intellectuals. It is a publishing platform designed to make great stories by content creators. This is your era, your place to be online. So come forward share your views, thoughts and ideas via Content Rally.

Leave a Reply

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How Digital Advisors have Transformed the Investment Sector

Is Fixed Deposit the Right Place to Invest Post-Demonetization?

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A Detailed Guide to Cashless Car Insurance Policy

What is a cashless car insurance policy?

What does the cashless car insurance policy cover?

What is an authorized garage?

What are the benefits of a cashless policy?

How to buy a cashless car insurance policy?

Share this Article

Essential Reasons for Comparing Car Insurance Quotes Online

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Content Rally wrapped around an online publication where you can publish your own intellectuals. It is a publishing platform designed to make great stories by content creators. This is your era, your place to be online. So come forward share your views, thoughts and ideas via Content Rally.

Leave a Reply

Popular

Follow Us

Recent

Related