Comprehensive Insurance of Your Car
A Insurance Article Contributed by Deepak Cutting
Comprehensive Car Insurance
Comprehensive Insurance is a contract between the owner and the Insurance Company where the latter agrees to compensate for any accidental damage or loss to the car, in consideration for an Insurance Premium to be paid by the owner. Compensation is limited to accidental damage only and does not include any damage or loss in value due to usual wear and tear.
In case the car is damaged beyond repair, it is called 'Total Loss' and the Insurance Company typically reimburses the depreciated value of the car, taking possession of the damaged vehicle. However, you may also obtain comprehensive car insurance for 'full value' when the compensation in the event of a write-off will not be the depreciated value but the 'agreed value' will be payable.
Further, the car insurance policy may also be made to take into account inflation, which is usually put at 8% per annum.
Calculation of Insured Value of Your Car for Comprehensive Insurance
The most usual way to arrive at the value of your car is what you paid, should the vehicle be new. Also, any accessories added or other additions to the car since the purchase must be taken into account. For used cars, the usual depreciation is reduced from its value, on basis of the age of the vehicle. In case of used or restored cars, determination of value of the car for insurance purposes may pose some difficulty since all cars are not restored to the same level.
If any special condition applies, an appraiser may be required to assess the value of your car. There are guidebooks available for assessment of the value of your car for insurance purposes and they could be useful for the purpose.
Other Factors That Effect the Calculation of Car Insurance Premium
The past accident record of the driver will effect premium calculation. A clean driving record naturally reduces the premium payable. The age of the driver, as also the sex of the driver effect premium calculation (male drivers command a lower premium, other things being equal). Detail of other family members who may drive the car is also taken into account. Whether or not the car is locked up inside a garage in your house, when not in use will effect the car insurance premium payable.
If the car is fitted with injury prevention devices such as air bags, automatic seat belts etc., and anti burglary devices such as car alarms and locator devices, will bring down the applicable car insurance premium. Also, should the insured car be used for racing or for commercial activities will effect the premium calculation.
It is always wise to get several quotations from different sources, before deciding on the best available option. Some homework will pay rich dividends. Online quotes are also available and should be made use of.
It should be remembered that, if the car to be insured is quite old and used, it is not wise to declare a big value for the vehicle. Depreciation on account of age will substantially reduce the amount payable, if claim becomes payable.
